Question 1

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time.
-Pre-1963

Accepted Answer

A)   Period of expansion of the type of situation pure economic loss could be recoverable in, following expansion of duty in negligence more generally and exception and principles created in Hedley Byrne & Co Ltd v Heller and Partners [1963]
B)   Gradual and slow incremental expansion of the type of situation pure economic loss is recoverable in, using principles of Hedley Byrne & Co Ltd v Heller and Partners [1963]
C)   No recovery of pure economic loss in negligence
D)   Closing down of the exceptions, a retreat from a more generous position regarding pure economic loss C

Question 2

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time.
-1963-1983

Accepted Answer

A)   Period of expansion of the type of situation pure economic loss could be recoverable in, following expansion of duty in negligence more generally and exception and principles created in Hedley Byrne & Co Ltd v Heller and Partners [1963]
B)   Gradual and slow incremental expansion of the type of situation pure economic loss is recoverable in, using principles of Hedley Byrne & Co Ltd v Heller and Partners [1963]
C)   No recovery of pure economic loss in negligence
D)   Closing down of the exceptions, a retreat from a more generous position regarding pure economic loss

Question 3

Why did the claim for pure economic loss fail in Customs & Excise Commissioners v Barclays Bank [2006]?

Accepted Answer

A)   The claimant could not show that a special (fiduciary)  relationship existed on which to base a duty of care.
B)   The claimant could not show that they had relied on the defendant.
C)   The claimant could not show that their reliance had been reasonable in the circumstances.
D)   Because the defendant had not assumed responsibility.
E)   Because the assumption of responsibility by the defendant was not voluntary

Question 4

Describing the position of the claimants in White v Jones [1995] as evidencing 'a lacuna in the law that ought to be filled' (at 260), Lord Goff then went on to explain the reason behind his decision that a duty of care existed:
'The _______ of denying such a remedy is reinforced if one considers the importance of legacies in a society which recognises . . . the right of citizens to leave their assets to whom they please, and in which, as a result, legacies can be of great importance to individual citizens, providing very often the only opportunity for a citizen to acquire a significant capital sum; or to inherit a house, so providing a secure roof over the heads of himself and his family; or to make special provision for his or her old age'.

Accepted Answer

The answer of Describing the position of the claimants in...

Question 5

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors)  Ltd [1973] with the way it was categorised in law.
-The steel that was in the furnace at the time of the power cut, which was ruined and therefore had to be thrown away

Accepted Answer

A)   Consequential economic loss
B)   Pure economic loss
C)   Property damage

Question 6

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time.
-1990-present

Accepted Answer

A)   Period of expansion of the type of situation pure economic loss could be recoverable in, following expansion of duty in negligence more generally and exception and principles created in Hedley Byrne & Co Ltd v Heller and Partners [1963]
B)   Gradual and slow incremental expansion of the type of situation pure economic loss is recoverable in, using principles of Hedley Byrne & Co Ltd v Heller and Partners [1963]
C)   No recovery of pure economic loss in negligence
D)   Closing down of the exceptions, a retreat from a more generous position regarding pure economic loss B

Question 7

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time.
-1983-90

Accepted Answer

A)   Period of expansion of the type of situation pure economic loss could be recoverable in, following expansion of duty in negligence more generally and exception and principles created in Hedley Byrne & Co Ltd v Heller and Partners [1963]
B)   Gradual and slow incremental expansion of the type of situation pure economic loss is recoverable in, using principles of Hedley Byrne & Co Ltd v Heller and Partners [1963]
C)   No recovery of pure economic loss in negligence
D)   Closing down of the exceptions, a retreat from a more generous position regarding pure economic loss

Question 8

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors)  Ltd [1973] with the way it was categorised in law.
-The lost profit that would have been made on other steel that would have been processed during the time in which the factory was closed after the power cut

Accepted Answer

A)   Consequential economic loss
B)   Pure economic loss
C)   Property damage

Question 9

Which of the following have been used as public policy justifications to support the denial of recovery for pure economic loss?
Please select all that apply.

Accepted Answer

A)   Allowing recovery could lead to crushing liability
B)   People and businesses can be expected to insure themselves against foreseeable economic losses
C)   Allowing recovery would lead to indeterminate liability
D)   The risk of economic loss would be better shouldered collectively by society rather than individual defendants
E)   Allowing recovery for foreseeable economic losses might encourage workers to take more care at workF)  Allowing recovery would lead to a flood of minor, vexatious or frivolous claimsG)  The 'proper' avenue for claiming economic losses is through contract lawH)  Allowing claims would negatively affect the efficiency of the market

Question 10

Since Murphy v Brentwood DC [1990], in what circumstances will a claim for pure economic loss caused by negligence give rise to a duty of care?

Accepted Answer

A)   The claimant must be able to rely on the four principles established in Hedley Byrne v Heller [1963] in order to establish a duty of care in respect of pure economic losses.
B)   There is no basis for a claim of this type. Murphy completely closed down this area of law and no duty of care for pure economic loss can now arise.
C)   The only time a duty of care can arise in relation to pure economic loss is in will-drafting cases.

Question 11

In Hedley Byrne & Co Ltd v Heller and Partners [1963], the House of Lords outlined four factors that must be established in order to find that a duty of care was owed in respect of negligently-made statements leading to economic loss. What were they?
Please select all that apply.

Accepted Answer

A)   It must have been reasonable in the circumstances for the person receiving the advice given/statement made to rely on it.
B)   The existence of a special (or 'fiduciary')  relationship of trust and confidence between the parties.
C)   Something must have been done rather than only said or stated (in written or oral form) .
D)   The party preparing the advice/information has voluntarily assumed the risk (expressly or by implication)  that it could be wrong.
E)   The party receiving the advice/information has relied on it.F)  The party giving the advice must be trustworthy.

Question 12

In Murphy v Brentwood DC [1990], cracks in the wall of a new house in which the design had been negligently approved by the council were considered to be pure economic loss.

Accepted Answer

A) True 
 B)False

Question 13

Describing the pure economic loss suffered in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd [1973], Lord Denning MR outlined the policy reasons why he believed that such loss should not be recoverable following something like a power cut, saying: '…most people are content to take the risk on themselves.
When the supply is cut off, they do not go running round to their solicitor. They do not try to find out whether it was anyone's fault. They just put up with it. They try to make up the economic loss by doing more work next day'.
He added that this 'is a ______ _______ which the law should encourage' (at 38).

Accepted Answer

healthy attitude

Question 14

In Anns v Merton London Borough Council [1978], Lord Wilberforce categorised cracks in the wall of a new house in which the construction had been negligently supervised as pure economic loss.

Accepted Answer

A) True 
 B)False

Question 15

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors)  Ltd [1973] with the way it was categorised in law.
-The loss of profit that could have been made by selling the steel in the furnace that had been ruined when the power cut occurred

Accepted Answer

A)   Consequential economic loss
B)   Pure economic loss
C)   Property damage

Exam 7: Special Duty Problems: Economic Loss

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -Pre-1963

Correct Answer
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C

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -1963-1983

Correct Answer
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Why did the claim for pure economic loss fail in Customs & Excise Commissioners v Barclays Bank [2006]?

Correct Answer
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Correct Answer
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Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd [1973] with the way it was categorised in law. -The steel that was in the furnace at the time of the power cut, which was ruined and therefore had to be thrown away

Correct Answer
verified

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -1990-present

Correct Answer
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B

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -1983-90

Correct Answer
verified

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd [1973] with the way it was categorised in law. -The lost profit that would have been made on other steel that would have been processed during the time in which the factory was closed after the power cut

Correct Answer
verified

Which of the following have been used as public policy justifications to support the denial of recovery for pure economic loss? Please select all that apply.

Correct Answer
verified

Since Murphy v Brentwood DC [1990], in what circumstances will a claim for pure economic loss caused by negligence give rise to a duty of care?

Correct Answer
verified

In Hedley Byrne & Co Ltd v Heller and Partners [1963], the House of Lords outlined four factors that must be established in order to find that a duty of care was owed in respect of negligently-made statements leading to economic loss. What were they? Please select all that apply.

Correct Answer
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In Murphy v Brentwood DC [1990], cracks in the wall of a new house in which the design had been negligently approved by the council were considered to be pure economic loss.

Correct Answer
verified

Correct Answer
verified
healthy attitude

In Anns v Merton London Borough Council [1978], Lord Wilberforce categorised cracks in the wall of a new house in which the construction had been negligently supervised as pure economic loss.

Correct Answer
verified

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd [1973] with the way it was categorised in law. -The loss of profit that could have been made by selling the steel in the furnace that had been ruined when the power cut occurred

Correct Answer
verified

Exam 7: Special Duty Problems: Economic Loss

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -Pre-1963

Correct AnswerverifiedC

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -1963-1983

Correct AnswerverifiedShow Answer

Why did the claim for pure economic loss fail in Customs & Excise Commissioners v Barclays Bank [2006]?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd [1973] with the way it was categorised in law. -The steel that was in the furnace at the time of the power cut, which was ruined and therefore had to be thrown away

Correct AnswerverifiedShow Answer

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -1990-present

Correct AnswerverifiedB

Match the time periods below with the general principle regarding the availability of recovery for negligently-caused pure economic loss at that time. -1983-90

Correct AnswerverifiedShow Answer

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd [1973] with the way it was categorised in law. -The lost profit that would have been made on other steel that would have been processed during the time in which the factory was closed after the power cut

Correct AnswerverifiedShow Answer

Which of the following have been used as public policy justifications to support the denial of recovery for pure economic loss? Please select all that apply.

Correct AnswerverifiedShow Answer

Since Murphy v Brentwood DC [1990], in what circumstances will a claim for pure economic loss caused by negligence give rise to a duty of care?

Correct AnswerverifiedShow Answer

In Hedley Byrne & Co Ltd v Heller and Partners [1963], the House of Lords outlined four factors that must be established in order to find that a duty of care was owed in respect of negligently-made statements leading to economic loss. What were they? Please select all that apply.

Correct AnswerverifiedShow Answer

In Murphy v Brentwood DC [1990], cracks in the wall of a new house in which the design had been negligently approved by the council were considered to be pure economic loss.

Correct AnswerverifiedShow Answer

Correct Answerverifiedhealthy attitude

In Anns v Merton London Borough Council [1978], Lord Wilberforce categorised cracks in the wall of a new house in which the construction had been negligently supervised as pure economic loss.

Correct AnswerverifiedShow Answer

Match the loss in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd [1973] with the way it was categorised in law. -The loss of profit that could have been made by selling the steel in the furnace that had been ruined when the power cut occurred

Correct AnswerverifiedShow Answer

Correct Answer
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C

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B

Correct Answer
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Correct Answer
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healthy attitude

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Correct Answer
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