Why is pure economic loss generally not recoverable in negligence?

Courts fear indeterminate liability to an indeterminate class of claimants. Financial loss is also usually better dealt with by contract or by insurance.

What is consequential economic loss?

Consequential economic loss is financial loss flowing from physical damage to the claimant's own person or property. Earnings lost while a broken leg heals are recoverable as consequential loss.

When may pure economic loss caused by a careless statement be recovered?

Hedley Byrne v Heller [1964] allows recovery where the defendant assumed responsibility for advice and the claimant reasonably relied on it. A special relationship between the parties is required.

Eduqas A-Level Law A150QS

Parliamentary and European Law Making

Topic overview Green Papers, White Papers and the making of a Bill The legislative process through Parliament The composition and role of Parliament Influences on Parliament and law making Parliamentary sovereignty The UK constitution, separation of powers and the rule of law The royal prerogative Law reform and the Law Commission European Union institutions and sources of law The impact of European Union law and withdrawal

Delegated Legislation

Topic overview Delegated legislation and enabling Acts Statutory instruments By-laws Orders in Council and Henry VIII powers Parliamentary controls on delegated legislation Judicial control and the ultra vires doctrine Reasons for the use of delegated legislation Advantages and disadvantages of delegated legislation Devolved legislatures

Statutory Interpretation

Topic overview The need for statutory interpretation and the presumptions The literal rule The golden rule The mischief rule The purposive approach The rules of language Intrinsic aids Extrinsic aids and the use of Hansard The Human Rights Act 1998, European Union law and interpretation

Judicial Precedent

Topic overview The doctrine of precedent and stare decisis Ratio decidendi and obiter dicta Binding, persuasive and original precedent The hierarchy of the courts The Supreme Court and the Practice Statement 1966 The Court of Appeal and the exceptions in Young v Bristol Aeroplane Overruling, reversing and distinguishing Law reporting and judicial law making Advantages and disadvantages of precedent

The Civil Courts and Civil Process

Topic overview The civil courts and their jurisdiction Starting a claim and the Civil Procedure Rules Allocation to track and case management Civil appeals and the appellate courts Tribunals: development, role and control Arbitration Mediation, conciliation and negotiation Trial, judgment and enforcement Justice, interests and barriers in the civil process

The Criminal Process

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Legal Personnel

Topic overview Solicitors: education, training and role Barristers: education, training and role Structure of the legal professions, fusion and social background Regulation of the legal professions Legal executives and paralegal personnel The judiciary: hierarchy, composition and role Judicial selection, appointment and training Judicial independence and the rule of law The magistracy and district judges in the magistrates' courts

Access to Justice and Funding

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Contract: Rules and Theory of Contract LawContract

Topic overview Origins and definition of the law of contract The function of the law of contract Contract as a set of rules for freely made agreements Contract law and economic development Arguments for a European or global contract law system Human rights and the law of contract Freedom of contract and consumer protection The impact of judicial decisions and legislation on contract Contract law, justice and morality

Contract: Essential Requirements and FormationContract

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Contract: Misrepresentation and Economic DuressContract

Topic overview What counts as an actionable misrepresentation Statements of opinion, intention and expertise Silence, half-truths and changing circumstances Inducement and reliance Fraudulent misrepresentation Negligent misrepresentation Innocent misrepresentation and remedies under the Act Rescission and the bars to rescission Economic duress

Contract: Discharge of ContractContract

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Contract: RemediesContract

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Tort: Rules and Theory of Tort LawTort

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Tort: NegligenceTort

Topic overview Duty of care and the neighbour principle The Caparo test and the modern approach to duty Injury to people, damage to property and other kinds of loss Breach of duty and the reasonable man The standard of care for professionals and for children Risk factors in deciding breach Proving breach and res ipsa loquitur Factual causation and the but for test Legal causation, intervening acts and remoteness of damage

Tort: Occupiers' LiabilityTort

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Tort: Torts Connected to LandTort

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Tort: Vicarious LiabilityTort

Topic overview The nature of vicarious liability The purpose of vicarious liability and the arguments about it Tests for the status of employment: control and integration The economic reality test and the modern multiple test Relationships akin to employment Scope of employment: authorised acts done in an unauthorised way Frolic of his own, detours and journeys Intentional wrongdoing and the close connection test Independent contractors and unusually hazardous activities

Tort: Defences and RemediesTort

Topic overview Volenti non fit injuria: the elements of the defence Volenti, rescuers and employees Volenti in road traffic cases and the defence of illegality Contributory negligence and the Law Reform (Contributory Negligence) Act 1945 Applying contributory negligence: seat belts, children and emergencies Defences and remedies in claims connected to nuisance and Rylands v Fletcher Compensatory damages in tort Assessing personal injury damages and mitigation of loss Injunctions and other remedies in tort

Criminal Law: Rules and TheoryCriminal

Topic overview The definition of a crime and the purposes of criminal law Burden and standard of proof in criminal cases Criminal law, morality and justice Codification of the criminal law The Crown Prosecution Service and the decision to prosecute The Attorney-General and the Director of Public Prosecutions Bail and the presumption in favour of liberty Remand in custody and custody time limits The criminal trial process Youth justice

Criminal Law: General Elements of LiabilityCriminal

Topic overview Actus reus: conduct, consequences and states of affairs Voluntary and involuntary conduct Liability for omissions Factual causation Legal causation and intervening acts Intention: direct and oblique Recklessness, negligence and transferred malice Coincidence of actus reus and mens rea Strict liability and the Gammon tests

Criminal Law: Offences Against the PersonCriminal

Topic overview Murder: elements and malice aforethought Voluntary manslaughter: loss of control Voluntary manslaughter: diminished responsibility Unlawful act manslaughter Gross negligence manslaughter Assault Battery Actual bodily harm under section 47 Malicious wounding and grievous bodily harm under section 20 Wounding and grievous bodily harm with intent under section 18

Criminal Law: Property OffencesCriminal

Topic overview Theft: appropriation Theft: property Theft: belonging to another Theft: dishonesty Theft: intention permanently to deprive Robbery Burglary with intent under section 9(1)(a)Burglary by theft or grievous bodily harm under section 9(1)(b)Buildings, dwellings and trespass in burglary

Criminal Law: Capacity DefencesCriminal

Topic overview Insanity: the M'Naghten rules Disease of the mind and the internal cause test The special verdict and disposal after insanity Non-insane automatism Self-induced automatism Voluntary intoxication by alcohol Intoxication by drugs and involuntary intoxication Specific and basic intent offences Drunken mistake and criticism of the capacity defences

Criminal Law: Necessity Defences and Preliminary OffencesCriminal

Topic overview Mistake as a defence Self-defence and the prevention of crime Reasonable force and householder cases Duress by threats and the Graham test Limits on duress: murder, association and evasive action Duress of circumstances Necessity Consent Attempt: the actus reus and more than merely preparatory Attempt: mens rea and impossible attempts

Human Rights: Rules and TheoryHuman rights

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Human Rights: Protection of Rights and Freedoms in the UKHuman rights

Topic overview Protection of rights in the UK constitution before 1998 The Council of Europe and the history of the Convention The scope of the Convention and its Protocols The European Court of Human Rights: composition and application Doctrines developed by the Strasbourg court The main provisions of the Human Rights Act 1998 The impact of the Human Rights Act 1998 in the courts Criticisms of human rights and a UK Bill of Rights The Human Rights Act and the devolution settlements

Human Rights: Convention ProvisionsHuman rights

Topic overview Article 5 and the right to liberty and security of the person Article 5 exceptions, safeguards and restrictions Article 6 and the right to a fair trial Article 6 and the nature of an absolute right Article 8 and the right to respect for private and family life Article 8 exceptions, restrictions and positive obligations Article 10 and freedom of expression Article 10 exceptions and restrictions Article 11 and freedom of peaceful assembly and association

Human Rights: Restrictions on Convention RightsHuman rights

Topic overview How a qualified right may lawfully be restricted Freedom of assembly and public order law Police powers of stop and search Police powers of arrest and detention Search of premises, terrorism powers and remedies Interception of communications and surveillance Confidentiality, official secrets and contempt of court Obscenity and the control of publication Defamation, trespass and harassment

Human Rights: EnforcementHuman rights

Topic overview The Human Rights Act and the domestic courts Interpretation and Strasbourg case law Declarations of incompatibility Public authorities and claims under the Act Judicial review: the grounds Judicial review: procedure, standing and remedies The European Court of Human Rights The effect and enforcement of Strasbourg judgments

Human Rights: ReformHuman rights

Topic overview Criticisms of the Human Rights Act The case for keeping the Human Rights Act The case for a UK Bill of Rights The case against a UK Bill of Rights The United Kingdom and the Convention system The Equality and Human Rights Commission Protection beyond the Human Rights Act The future of rights protection

The Nature of Law

Topic overview Legal rules, other norms and the sources of law Law and society: fault and competing interests Law and morality Law and justice: theories of justice

Tort: Negligence

Injury to people, damage to property and other kinds of loss

3 things to know
Components 2 and 3

Overview

Pure economic loss, consequential economic loss and requirement that a product reach the consumer without intermediate examination.

What you need to know

Answer each one before you reveal it.

Your recallNot started

Key term

Which kinds of damage does negligence most readily compensate?

Key term

Who may sue for damage to property in negligence?

Key term

What is pure economic loss?

Questions from this subtopic

Each one with the model answer underneath.

1
Which kinds of damage does negligence most readily compensate?
Model answer
Negligence most readily compensates physical injury to the person and physical damage to property. Other kinds of loss are recoverable only within much tighter limits.
2
Who may sue for damage to property in negligence?
Model answer
A claimant suing for property damage must have owned or possessed the property when the damage occurred. A person with only a contractual interest in the goods cannot sue in negligence.
3
What is pure economic loss?
Model answer
Pure economic loss is financial loss that does not flow from injury to the claimant's person or property. Profit lost because a power cable to a neighbouring factory was cut is the standard example.
4
Why is pure economic loss generally not recoverable in negligence?
Model answer
Courts fear indeterminate liability to an indeterminate class of claimants. Financial loss is also usually better dealt with by contract or by insurance.
5
What is consequential economic loss?
Model answer
Consequential economic loss is financial loss flowing from physical damage to the claimant's own person or property. Earnings lost while a broken leg heals are recoverable as consequential loss.
6
When may pure economic loss caused by a careless statement be recovered?
Model answer
Hedley Byrne v Heller [1964] allows recovery where the defendant assumed responsibility for advice and the claimant reasonably relied on it. A special relationship between the parties is required.

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