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Introduction

"Negligence is the omission to do something which a reasonable man, guided upon those considerations which ordinarily regulate human affairs, would do or doing something which a prudent and reasonableman would not do."- Baron Alderson

The tort of negligence is the most important tort, and unfortunately one of the most complex too. Negligence can be neatly summarised by the dictionary as 'lack of proper care in doing something', yet if we were to claim for every minor fault in our lives then life would just be stupid. This simple flaw of everyone claiming for everything is what has moulded the tort of negligence over the years into what we now study.

For the law to function it must be established whether the defendant owes a duty of care, this was done on a case by case basis where the claimant had to show his case followed another, or persuade the court to recognise his case as a new duty of care situation.

In 1932 this all changed after the famous case of Donoghue v Stevenson.

Donoghue v Stevenson - In this case Mrs Donoghue went to a cafe with a friend. The friend bought her a bottle of ginger beer, which was in a sealed opaque bottle. She drank it and realised it contained a decomposing snail. She became ill and sued. It was held that the manufacturer owed a duty of care to the ultimate consumer.

The judgment by Lord Atkin stated that lack of privity of contract did not prevent the claimant from claiming, and that negligence was a tort in its own right. Lord Atkin also set out a three part test for negligence: The existence of a duty of care from the defendant; a breach of that duty; and damage being reasonably caused as a result of the breach.

The determination of a claimant holding a duty of care is summarised as the neighbour principle, this is considered as anyone who is so closely and directly affected by the act or ommision that they should be reasonably contemplated beforehand.

Development of the law and the 2-tier test.

Although the case of Donoghue v Stevenson is now known as a breakthrough in the way negligence cases are handled, Judges at the time were relectant to use the 'neighbour principle' and stick with the familiar method of finding an existing precedent. It wasn't up until 1970, nearly 40 years later that the usefulness of the neighbour principle started to gain attention.

Lord Reid stated judicially that: "the time has come when we can and should say that [the neighbour principle] ought to apply unless there is some justification or valid explanation for its exclusion"

Home Office v Dorset Yacht Co - Ten borstal trainees were working on Brownsea Island in the harbour under the control of three officers employed by the Home Office. Seven trainees escaped one night, at the time the officers had retired to bed leaving the trainees to their own devices. The seven trainees who escaped boarded a yacht and collided with another yacht, the property of the claimants, and damaged it. The owners of the yacht sued the Home Office in negligence for damages.

It was reasonably forseeable, if not highly likely, that the boys would do something mischievous and taking the yacht was a reasonably forseeable consequence. Policy reasons also factored into makingthe defendant liable, to punish the Home Office and to prevent it occuring again.

The test set out by Donoghue v Stevenson was simplified with the case of Anns v Merton. This new test searched for a duty of care based on proximity of the two parties, rather than basing it upon previous cases. This is unless there is any reasons for the defendant to not be liable, such as policy reasons including floodgates or taxpayer money. Proximity is regarded in a legal sense, how much each party affects each other, rather than a physical one.

Anns v Merton - The local authority failed to ensure building work correctly followed the plans, resulting in shallow foundations. The building had changed many owners until the claimant started to notice cracks appearing. The builders had gone out of business, so the claimant sued the local authority.

Lord Wilberforce's verdict and 2-tier test developed some areas of law significantly, such as pure economic loss and nervous shock. Unfortunately the test could be seen to open the floodgates, as a duty of care could be held to apply in nearly every case unless good reasons were discouraging it. It was not long until criticism came, and eventually a new test to decide liabilty.

Governers of Peabody v Parkinson - The local authority approved plans for building development, yet these were not followed properly by a council inspector. The owners sued for negligence.

The House of Lords held that the defendant was not liable in this case. Lord Keith believed that the temptation to treat the test in Anns as definitive in character should be resisted. A more important question is whether it is just and fair to impose a duty than just policy reasons.

Yeun Kun Yeu v AG of Hong Kong - Investors lost money because of fraud in the investment company. They sued the commisioner of deposit-taking for his alleged negligence.

The Privy Council held that the defendant was not liable with Lord Keith again criticising Lord Wilberforce stating the test had been "elevated to a degree of importance greater than its merits", which was probably not Lord Wilberforces intention. Thus it was decided that the test should not be regarded in future for every case as a suitable guide to establishing a duty of care.

Caparo and the current 3-part test.

Caparo v Dickman - The claimants were shareholders who decided to buy more shares in a company as a take-over bid. They decided to do this based on audited accounts prepared by the defendant sowing a large profit. After a sucessful take-over they realised the audits were wrong and should have showed a loss.

In this case the House of Lords decided the autitors owed no duty of care, as the audits were not planned to influence a company takeover, and as such cannot be relied upon. This case is featured more importantly later on, in relation to negligent mistatement. However it is still highly important in setting up the current test. The House of Lords used it to introduce the 3-part test: Was the damage foreseeable?; was there a sufficiently close relationship between the two parties?; and is it just and reasonable to impose a duty of care?

Caparo was followed in the case of Murphy v Brentwood District Council. This case overruled Anns v Merton and followed the 3-part test.

Murphy v Brentwood District Council - The claimant bought a house which had plans approved by the council, yet these wern't followed correctly (just a tad similar to Anns and Peabody...) The foundations were inadequate and cracks began to appear. The claimant sued the council for negligence.

It was held that the council owed no duty of care to the purchaser. The House of Lords used the practice statement to formally overrule the verdict in Anns, with Lord Kieth stating the decision in Anns did not proceed on any basis of principle at all, but constituted a remarkable example of judicial legislation.