Negligence, Economic Loss and the Ambit of the Duty of Care
Difficulty in determining the true basis in law for allowing recovery of "pure" economic loss which is not consequential upon any physical damage suffered by a plaintiff has preoccupied the courts in a number of recent decisions.' If A relies on negligent information or advice given directly to him by B the case can simply be tested against the principles first laid down in Hedley Byrne & Co Ltd v Heller & Partners Ltd as appropriate to financial loss caused by misstatements. But what if the information is given to C and he acts in a way which causes loss to B. Or suppose A by his negligent act or omission causes such loss either directly to B or through the instrumentality of C. Can Hedley Byrne apply in any of these cases? If not, can a test of foresight of harm based on Donoghue v Stevenson be applied in the face of long standing judicial reluctance to recognise that decision as of any direct relevance in the sphere of economic harm?
