Muirhead v Industrial Tank [1985] EWCA Civ 16 (31 July 1985)

Muirhead v Industrial Tank [1985] EWCA Civ 16 (31 July 1985)

The manufacturer (Leroy Somer) is not liable in negligence for pure economic loss suffered by the plaintiff, as there was no sufficient proximity or reliance to justify such liability under current law. However, the manufacturer is liable for physical damage to the plaintiff's property (the lobsters) and consequential financial loss, as such damage was reasonably foreseeable given the intended use of the motors in fish farming operations.

Citation
[1985] EWCA Civ 16
Parties
Plaintiff: Robert Muirhead; First Defendant: Industrial Tank Specialities Ltd. (ITS); Second Defendant: ITT (UK) Ltd.; Third Defendant / Appellant: Leroy Somer Electrical Motors Ltd.
Jurisdiction
England and Wales
Judgment Date
31 July 1985
Procedural Posture
Civil Appeal / Appeal From Trial Judgment on Liability
Outcome
Appeal allowed in part
Legal Topics
Negligence, Economic Loss, Duty of Care, Foreseeability, Product Defects, Exclusion Clauses
Tort Law Product Liability Negligence Economic Loss Duty of Care Foreseeability Product Defects Exclusion Clauses

Case Brief

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Parties

Robert Muirhead

Plaintiff

Industrial Tank Specialities Ltd. (ITS)

First Defendant

ITT (UK) Ltd.

Second Defendant

Leroy Somer Electrical Motors Ltd.

Third Defendant / Appellant

Procedural Posture

Civil Appeal / Appeal From Trial Judgment on Liability

Legal Issues

  1. 1 Whether the manufacturer of electric motors (Leroy Somer) owed a duty of care in negligence to the ultimate purchaser (Muirhead) for pure economic loss and/or physical damage to property resulting from defective motors supplied via a chain of contracts.
  2. 2 Whether the loss of lobsters (physical damage) was reasonably foreseeable by the manufacturer as a result of the defective motors.

Ratio Decidendi

The manufacturer (Leroy Somer) is not liable in negligence for pure economic loss suffered by the plaintiff, as there was no sufficient proximity or reliance to justify such liability under current law. However, the manufacturer is liable for physical damage to the plaintiff's property (the lobsters) and consequential financial loss, as such damage was reasonably foreseeable given the intended use of the motors in fish farming operations.

Court Disposition

Appeal allowed in part

Orders

  • Appellants (Leroy Somer) not liable for pure economic loss; liable only for physical damage to lobsters and consequential loss.
  • Appellants to have half their costs.