Study Notes
Key Case | Hedley Byrne v Heller and Partners (1964) | Negligence - Pure Economic Loss
- Level:
- A-Level, BTEC National
- Board:
- AQA, Edexcel, OCR, IB, Eduqas, WJEC
Last updated 6 Oct 2020
This case established that it may be possible to make a claim in negligence for pure economic loss where there is a special relationship assuming responsibility between two parties, despite them not being in a contract.
CASE SUMMARY
Claimant: Hedley Byrne, an advertising company
Defendant: Heller and Partners, merchant bankers and referees for Easipower
Facts: Hedley Byrne were interested in working with Easipower, a company they had not previously worked with, so they sought a financial reference from their bank. Heller and Partners provided a satisfactory reference for Easipower, which turned out to be incorrect and inappropriate. When Hedley Byrne suffered losses following non-payment from Easipower, they sought a claim against Heller and Partners.
Outcome: Not liable – there was an effective disclaimer in this case.
Legal principle: There was an actionable cause in negligence, where there is special relationship in certain circumstances this could give rise to a claim for purely economic loss, special relationships where there is an assumption of responsibility, albeit no contract.