Economic Loss

Question 1

Spartan steel v Martin

Answer 1

(D was carrying out roadworks and negligently damaged electricity supply to C’s factory causing damage to products (metal))

Question 2

Caparo v Dickman

Answer 2

Set out meaning of a special relationship (C relied on stock reports made by D turned out company was worthless)

Question 3

Chaudhry v Prabhakar

Answer 3

1. D possesses a special skill or expertise(D had some knowledge of cars and helped friend choose 2nd hand car which wasn’t road worthy)

Question 4

Smith v Bush

Answer 4

2. C relies on D’s statement (D, a surveyor, had to prepare report of condition of house and failed to spot partial collapse)

Question 5

Caparo v Dickman .2

Answer 5

3. D knows who will use the statement

Question 6

Law Society v KPMG

Answer 6

4. D knows the purpose of the statement (Accountants needed to prepare accounts for solicitors but failed to show clients money had been stolen)

Question 7

Hedley Byrne v Heller

Answer 7

5. No disclaimer (A bank needed to provide a reference for advertising agency which was favourable towards X ‘without responsibility’ X ended up in financial difficulty)

Question 8

Spring v Guardian Assurance

Answer 8

Third party relies on misstatement which causes economic loss to C (C failed to obtain a new job because of an unfavourable reference negligently made by D)