pure economic loss Flashcards
definition of pure economic loss
loss of money without suffering physical damage to property, this generally does not allow recovery of compensation
what is the floodgate rule
a phrase that’s used which may lead to a dramatic increase in litigation or a ‘flood’of similar claims
What is the exception to claims for pure economic loss
NEGLIGENT MISSTATEMENT
- so the defendant made a statement with incorrect information which led to the claimant losing money (So when you say something and another person act on it which as a result the claimant suffers financial losses)
What are the five elements required to establish a special relationship (only need to know names of cases) -MUST PROVE ALL OF THESE FOR A SPECIAL RELATIONSHIP SO INCLUDE ALL
- Expertise -> In case of Mutual Life v Evatt, they were an insurance company, not experts in investment advice
- Reliance -> Chaudry v Prabhakar- Defendant advise friend to buy secondhand car without noticing it had been in an accident, so he presented himself as being knowledgeable about cars, (also use case of Burgess, The defendant was an architect not a landscape Gardner)
- Directly communicated- Goodwill V British Pregnancy, advise the man about a vasectomy, only one tattoo in 1000 and then have a vasectomy that fails and he subsequently conceived the child
- Purpose- Caparto v Dickman, Caporal purchase shares which indicated a pre-tax profit where as they actually made a loss instead
- No disclaimer- Patchett, Website used are use of website recognised by defendants website and lost money, they were not reliable because they had urge to use her to seek further information
disclaimer meaning
Statement informing the claimant that company does not accept responsibility for the advice given
reliance
IS IT REASONABLE TO RELY ON THIS
note
can only claim for PEL if there is a special relationship is established
