The claimant was injured when at a horse fair. A loose horse kicked him causing injury. They claimed in negligence against the council for licensing the fair without ensuring that public liability insurance. The Council now appealed agaiinst a finding that they were liable, saying that this had been a wrongful extension of the law of negligence.
Held: The appeal succeeded. The Council owed the claimant no duty of care as asserted.
Toulson LJ said: ‘The fact that this is a novel claim is not necessarily fatal because the categories of negligence are never closed. But the Privy Council and the House of Lords have approved the well-known judgment of Brennan J in Sutherland Shire Council v Heyman (1985) 60 ALR 1, 43-44, where he expressed the view that: ‘the law should develop novel categories of negligence incrementally and by analogy with established categories, rather than by a massive extension of a prima facie duty of care restrained only by indefinable ‘considerations which ought to negative, or to reduce or limit the scope of the duty or the class of the person to whom it is owed’. See Yuen Kun Yeu v Attorney General of Hong Kong [1988] AC 175, 191 and Caparo (618, 633-634).
As Lord Oliver observed in Caparo (634), Brennan J was echoing a theme expressed in Hedley Byrne and Co Limited v Heller and Partners Limited [1964] AC 465 by Lord Devlin, whose speech in that case has come to be seen as particularly significant. (See the observations of Lord Goff in Henderson v Merrett Syndicates Limited [1995] 2 AC 145, 178 and ff.) In Caparo (634-635) Lord Oliver cited a lengthy passage from Lord Devlin’s speech about the development of the law since Donoghue v Stevenson [1932] AC 562, in which he concluded:
‘The real value of Donoghue v Stevenson to the argument in this case is that it shows how the law can be developed to solve particular problems. Is the relationship between the parties in this case such that it can be brought within a category giving rise to a special duty? As always in English law, the first step in such an enquiry is to see how far the authorities have gone, for new categories in the law do not spring into existence overnight.’
Lord Oliver in an important passage . . observed that the extension of the concept of negligence since the decision in Hedley Byrne to cover cases of pure economic loss had given rise to ‘a considerable and as yet unsolved difficulty of definition’. The postulate of a simple duty to avoid any harm that was, with hindsight, reasonably capable of being foreseen was untenable without the imposition of some intelligible limits to keep the law of negligence within the bounds of common sense and practicality. He observed that those limits had been found by the requirement of what has been called a ‘relationship of proximity’ between the claimant and the defendant and by the imposition of a further requirement that the attachment of liability for the harm which had occurred be ‘just and reasonable’. But it was impossible to identify some common dominator by which the existence of the essential relationship could be tested, and that ‘to search for any single formula which will serve as a general test of liability is to pursue a will-of-the-wisp’. The most that could be attempted is a broad categorisation of the decided cases according to the type of situation in which liability has been established in the past in order to found an argument by analogy.
These words needs to be emphasised because there is sometimes a tendency (as the present case shows) to pluck out the words ‘fair, just and reasonable’ as if they provide some comprehensive touchstone. In itself, the expression means little more than that the court should only impose a duty of care if it considers it right to do so. The various speeches in Customs and Excise Commissioners v Barclays Bank plc [2006] UKHL 28, [2007] 1 AC 181 underline the point that the ‘threefold test’ provides no straightforward answer to the question whether in a novel situation a party owes a duty of care (Lord Bingham at 6, Lord Hoffmann at 35-36, Lord Rodger at 53, Lord Walker at 71 and Lord Mance at 93). In considering whether there is sufficient ‘proximity’ to make it just and reasonable to impose a duty of care, the courts examine carefully the nature of the relationship between the parties and begin by considering whether it is reasonably analogous to other cases in which such a duty has been recognised. The court is looking to see whether there is ‘that special relationship of proximity which is required to give rise to the duty of care’ to protect the claimant from economic loss (using the language of Lord Oliver in Caparo at 650F) – which is another way of framing the question posed by Lord Devlin in Hedley Byrne ‘Is the relationship between the parties in this case such that it can be brought within a category giving rise to a special duty?’ . . For a duty of care to arise, there needs to be something particular about the relationship between the defendant and the claimant, in relation to some particular transaction or activity likely to have economic consequences for the claimant, such that the claimant can properly expect to be entitled to rely on the defendant to safeguard him from economic harm likely to result from want of care on the part of the defendant. This need is reflected by the usage of the words ‘special duty’ or ‘special relationship. There was no such relationship in the present case between the Town Council and the many tens of thousands of members of the general public, including the claimants, who visited the fair.’
Lord Neuberger, MR, Toulson, Jacob LJJ
[2009] EWCA Civ 1325, [2009] NPC 143, [2010] PIQR P6
Bailii
England and Wales
Citing:
Cited – Caparo Industries Plc v Dickman and others HL 8-Feb-1990
Limitation of Loss from Negligent Mis-statement
The plaintiffs sought damages from accountants for negligence. They had acquired shares in a target company and, relying upon the published and audited accounts which overstated the company’s earnings, they purchased further shares.
Held: The . .
Cited – Dorset Yacht Co Ltd v Home Office HL 6-May-1970
A yacht was damaged by boys who had escaped from the supervision of prison officers in a nearby Borstal institution. The boat owners sued the Home Office alleging negligence by the prison officers.
Held: Any duty of a borstal officer to use . .
Cited – Gwilliam v West Hertfordshire Hospitals NHS Trust and Others CA 24-Jul-2002
The claimant sought damages. She had been injured after the negligent erection of a stand which was known to be potentially hazardous. The contractor was uninsured, and the claimant sought damages from the Hospital which had arranged the fair in its . .
Cited – Hedley Byrne and Co Ltd v Heller and Partners Ltd HL 28-May-1963
Banker’s Liability for Negligent Reference
The appellants were advertising agents. They were liable themselves for advertising space taken for a client, and had sought a financial reference from the defendant bankers to the client. The reference was negligent, but the bankers denied any . .
Cited – Sutherland Shire Council v Heyman 4-Jul-1985
(High Court of Australia) The court considered a possible extension of the law of negligence.
Brennan J said: ‘the law should develop novel categories of negligence incrementally and by analogy with established categories. ‘
Dean J said: . .
Cited – Yuen Kun-Yeu v Attorney-General of Hong Kong PC 1987
(Hong Kong) The claimant deposited money with a licensed deposit taker, regulated by the Commissioner. He lost his money when the deposit taker went into insolvent liquidation. He said the regulator was responsible when it should have known of the . .
Cited – Naylor (T/A Mainstreet) v Payling CA 7-May-2004
The claimant was injured by a door attendant employed as an independent contractor by the defendant.
Held: The defendant’s duty in selecting an independent contractor was limited to assessing the competence of the contractor. The duties of . .
Cited – Donoghue (or M’Alister) v Stevenson HL 26-May-1932
Decomposed Snail in Ginger Beer Bottle – Liability
The appellant drank from a bottle of ginger beer manufactured by the defendant. She suffered injury when she found a half decomposed snail in the liquid. The glass was opaque and the snail could not be seen. The drink had been bought for her by a . .
Cited – HM Customs and Excise v Barclays Bank Plc HL 21-Jun-2006
The claimant had served an asset freezing order on the bank in respect of one of its customers. The bank paid out on a cheque inadvertently as to the order. The Commissioners claimed against the bank in negligence. The bank denied any duty of care. . .
Cited – Naylor (T/A Mainstreet) v Payling CA 7-May-2004
The claimant was injured by a door attendant employed as an independent contractor by the defendant.
Held: The defendant’s duty in selecting an independent contractor was limited to assessing the competence of the contractor. The duties of . .
Cited – Smith v Eric S Bush, a firm etc HL 20-Apr-1989
In Smith, the lender instructed a valuer who knew that the buyer and mortgagee were likely to rely on his valuation alone. The valuer said his terms excluded responsibility. The mortgagor had paid an inspection fee to the building society and . .
Cited – Henderson v Merrett Syndicates Ltd HL 25-Jul-1994
Lloyds Agents Owe Care Duty to Member; no Contract
Managing agents conducted the financial affairs of the Lloyds Names belonging to the syndicates under their charge. It was alleged that they managed these affairs with a lack of due careleading to enormous losses.
Held: The assumption of . .
Cited by:
Cited – Michael and Others v South Wales Police and Another CA 20-Jul-2012
The deceased had called the police and said her life was under immediate threat. An officer downgraded its seriousness, and she was killed within 15 minutes by her partner, and before the officers arrived. She had sought assistance four times . .
Lists of cited by and citing cases may be incomplete.
Personal Injury, Negligence
Updated: 16 December 2021; Ref: scu.383789