Esso Petroleum Company Ltd. v Mardon [1976] EWCA Civ 4 (06 February 1976)

Esso Petroleum Company Ltd. v Mardon [1976] EWCA Civ 4 (06 February 1976)

Esso, possessing special knowledge and skill, made a negligent representation as to the petrol throughput of the service station, intending Mardon to rely on it. This representation constituted both a collateral warranty and a negligent misstatement. Mardon was induced to enter into the tenancy and suffered losses as a result. Esso is liable in damages for breach of warranty and/or negligent misrepresentation, and the losses after the new agreement in September 1964 are attributable to the original misstatement.

Citation
[1976] EWCA Civ 4
Parties
Plaintiff (respondent): Esso Petroleum Company Limited; Defendant (appellant): Philip Lionel Mardon
Jurisdiction
England and Wales
Judgment Date
06 February 1976
Procedural Posture
Appeal (from High Court, Queen's Bench Division) / Court of Appeal Judgment
Outcome
Appeal allowed; cross-appeal dismissed; judgment for Mardon on counterclaim for damages.
Legal Topics
Collateral Warranty, Negligent Misrepresentation, Measure of Damages, Pre Contractual Representations
Contract Law Tort Law Collateral Warranty Negligent Misrepresentation Measure of Damages Pre Contractual Representations

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Parties

Esso Petroleum Company Limited

Plaintiff (respondent)

Philip Lionel Mardon

Defendant (appellant)

Procedural Posture

Appeal (from High Court, Queen's Bench Division) / Court of Appeal Judgment

Legal Issues

  1. 1 Whether Esso's estimate of petrol throughput constituted a collateral warranty or negligent misrepresentation
  2. 2 Whether Esso was liable in contract or tort for losses suffered by Mardon
  3. 3 Appropriate measure and scope of damages for misrepresentation or breach of warranty

Ratio Decidendi

Esso, possessing special knowledge and skill, made a negligent representation as to the petrol throughput of the service station, intending Mardon to rely on it. This representation constituted both a collateral warranty and a negligent misstatement. Mardon was induced to enter into the tenancy and suffered losses as a result. Esso is liable in damages for breach of warranty and/or negligent misrepresentation, and the losses after the new agreement in September 1964 are attributable to the original misstatement.

Court Disposition

Appeal allowed; cross-appeal dismissed; judgment for Mardon on counterclaim for damages.

Orders

  • Esso to pay substantial damages to Mardon for losses suffered as a result of negligent misrepresentation and breach of warranty.
  • Assessment of damages, interest, and costs to be determined following further argument.