Hamble Fisheries v Gardner (‘The Rebecca Elaine’) [1999] 2 Lloyd’s Rep 1

Key point

No duty of care to warn of product defects extends to pure economic loss where there is no assumption of responsibility by reciprocal dealings between parties.

Facts

  • C bought an engine for its vessel, accompanied by a warranty against defects from the manufacturer and a manual that stated that the engine can operate without replacement for 20,000 hours
  • The engine’s manufacturer was later bought over by D
  • D became aware of a defect in the pistons but did not warn purchasers of it
  • C’s vessel was at sea when its engine failed due to the defect in the pistons
  • C sued for pure economic loss in negligence against D for its failure to warn about the defect

Held (Court of Appeal)

D was not liable for a failure to warn as there was no assumption of responsibility from D to C.

Tuckey LJ

  • Donoghue v Stevenson and Grant v Australian Mills only decide that a manufacturer has a duty of care to avoid physical damage to persons or property
  • Under English law one must look to Hedley Byrne and the cases which have followed to see whether there is a duty of care to avoid economic loss, there is no special category of duty for failure to warn
  • There had been no assumption of responsibility by circumstances akin to contract as there were no dealings between D or the and C, the manual while deemed to be adopted by D had not been relied upon by C