Pure economic loss

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Pure Economic Loss;

- Recovery for pure economic loss arises under negligent misstatement - Hedley Burn v Heller

-and under the Fatal Accidents Act

It is different from consequential loss, focuses less on compensation for loss of chance or physical damage.

Pure economic loss was recovered in the case of Spartan steel - where the electricity company cut off supply of electricity which caused a loss in production. Could only recover damage to the melt which was caused as the electricty was turned off, could also recover for loss of profit for the melts that were destroyed. Could NOT RECOVER FOR FUTURE melts Lord Denning : Court draws a line , must be duty based.

- May arise where there is no physical injury: Weller v foot and mouth disease research

D negligently released foot and mouth P was operating a market and gained foot and mouth, lost profit. HOWEVER pure economic loss without physical damage is not possible so there was nothing recoverable.

- Defective Goods- General rule defective rules can be recovered under contract.

- Anns v Merton - Building works were damaged, did not sue builders with whom contract was but local council who had apparently not carried out building inspection closely enough, showing there was structural damage. C could claim damages. Controversial because view that property damage could only apply to existing property not property being built. Also criticised for opening floodgates.

Murphy v Brentwood County Council - same situataion as Anns however court held that there was no duty of care, and it was pure economic loss which was not allowed in such a situation. No duty of care unless a special relationship- Lord Bridge

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