Spring v Guardian Assurance

Q : Can you be held liable for economic loss suffered because of your reference?

(ie, if you give bad statement (reference) about an employee of yours, and because of that, he isn't hired by other companies, can you be held liable)

- D made a statement that implied the CL is of no integrity and a dishonest person.




HELD : D owes a duty of care to his employee because of his negligent misstatement. 

Dutton v Bognor Regis UDC

Pure Economic Loss

Usually, courts would allow claims on consequential economic loss rather than pure economic loss.


- Mrs Dutton, the claimant suffered a financial loss because of the 'defect' in the foundations of the property due to the negligent inspections carried out by the inspector of Bognor Regis UDC.


- After appealing, Mrs Dutton won the case because: 
1) There was a threat of injury to health & safety


Q: If the defective property was merely of low quality, and not dangerous to health, would there be liablity?
No

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Thomas v Thomas [1842]

Consideration only need to be sufficient, it does not need to be adequate (enough)

The story of John Thomas

On the day of John Thomas's death, he told the witnesses that he wanted his wife to have one of his house for life, although it is not written in his will.


After his death, his executors gave one of the houses to his wife, if and only if she paid a rent of 1 pound per year and kept the house in good condition.


The wife paid the rent and kept the house in good condition.
Later, the executor tried to dispossess the house, but they failed.





Held : Contract was enforceable, not because it was the death wish of the husband BUT, merely because of the fact that the wife had paid rent.




Paying the rent shows consideration, therefore the contract was binding and the executors failed.

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Ward v Byham [1956]

A story about a father who abandoned the child.

1. A dad promised to pay the mother of his illegitimate child £1 per week if she ensured the child   was happy and looked after properly.


2. The mother looked after the child and kept the child happy.


3. Later then, the mother remarried and the father who abandoned the child refused to pay her under the argument that it was her legal duty to look after the child.




Held : The contract was binding. 

It was the mother's duty to look after the child, but it wasn't her duty to keep the child happy.

Consideration was found in this case when the mother kept the child happy.

Wise words by Lord Denning :
" I have always thought that a promise to perform an existing duty, or the performance of it, should be regarded as good consideration, because it is a benefit to the person whom it is given. "