Duty Of Care In Pre-Donoghue V. Stevenson (1932)

 Introduction:
Duty of care refers to the circumstances and relationships which the law recognizes as giving rise to a legal duty to take care. The first major case in the development of the ‘duty of care test’ was that of Donoghue v Stevenson [1932].
For many years there have been questions circling weather the decision held by the house of Lords in Caparo Industries plc v Dickman [1990] 2 AC presents the return to Pre-Donoghue v Stevenson [1932] AC 562 methods applied by the courts in determining and deciding the existence of duty of care in negligence. In this assignment I will investigate cases and the methods of Pre-Donoghue v Stevenson in setting out the duty of care along with the methods set, fixed and established in Donoghue v

Hedley Byrne were a firm of advertising agents. A customer, Easipower Ltd, put in a large order. Hedley Byrne wanted to check their financial position, and creditworthiness, and subsequently asked their bank, National Provincial Bank, to get a report from Easipower’s bank, Heller & Partners Ltd., who replied in a letter that was headed, "without responsibility on the part of this bank" It said that Easipower was, “considered good for its ordinary business engagements". The letter was sent for free. Easipower went into liquidation and Hedley Byrne lost £17,000 on contracts. Hedley Byrne sued Heller & Partners for negligence, claiming that the information was given negligently and was misleading. Heller & Partners argued there was no duty of care owed regarding the statements, and in any case liability was excluded. The court found that the relationship between the parties was "sufficiently proximate" as to create a duty of care. It was reasonable for them to have known that the information that they had given would likely have been relied upon for entering into a contract of some sort. This would give rise, the court said, to a "special relationship", in which the defendant would have to take sufficient care in giving advice to avoid negligence liability. However, on the facts, the disclaimer was found to be sufficient enough to discharge any duty created by Heller's actions. There were no orders for damages. The court found that H&P's disclaimer was sufficient to protect them from liability and Hedley Byrne's claim failed. However, the House of Lords ruled that damage for pure economic loss could arise in situations where the following four conditions were