Law of Tort
2nd November 2022
Economic Loss
Negligence gives compensation for economic loss – Money Loss
Pure economic loss – simply financial loss (loss of profit)
General rule – no compensation for economic loss
Claims for economic loss should be made in contract.
Weller v Foot and Mouth Institute [1966]
Escaped from laboratory, entered the food chain and was affecting cattle – cattle had to be
killed.
All cattle to be quarantined – no auctions to sell cattle – losing money
Sued defendents for negligence
HELD: Weller did not suffer any ohysical harm and no duty of care was owed.
Cases for pure economic loss cannot be compensated in tort law.
Economic Loss and Physical Damage:
If someone suffers physical damage to property (or person) which also causes economic loss
they can claim for that economic loss.
This is known as CONSEQUENTIAL ECONOMIC LOSS: Loss that follows from an injury from a
claimant or damage to their property.
Spartan Steel v Martin (1973) (CA)
- D carrying out roadworks and cut through electricity from utility company, the mill was
affected from the lack of power – suffered 3 losses:
Metal pink process damaged, has to be thrown away
Profit lost on the metal
The steel mill closed and sow C lost profit on melts that was lost that day.
2nd November 2022
Economic Loss
Negligence gives compensation for economic loss – Money Loss
Pure economic loss – simply financial loss (loss of profit)
General rule – no compensation for economic loss
Claims for economic loss should be made in contract.
Weller v Foot and Mouth Institute [1966]
Escaped from laboratory, entered the food chain and was affecting cattle – cattle had to be
killed.
All cattle to be quarantined – no auctions to sell cattle – losing money
Sued defendents for negligence
HELD: Weller did not suffer any ohysical harm and no duty of care was owed.
Cases for pure economic loss cannot be compensated in tort law.
Economic Loss and Physical Damage:
If someone suffers physical damage to property (or person) which also causes economic loss
they can claim for that economic loss.
This is known as CONSEQUENTIAL ECONOMIC LOSS: Loss that follows from an injury from a
claimant or damage to their property.
Spartan Steel v Martin (1973) (CA)
- D carrying out roadworks and cut through electricity from utility company, the mill was
affected from the lack of power – suffered 3 losses:
Metal pink process damaged, has to be thrown away
Profit lost on the metal
The steel mill closed and sow C lost profit on melts that was lost that day.
