I should make it clear that I express no opinion upon thequestion whether, if personal injury were suffered by an occupierof defective premises as a result of a latent defect in thosepremises, liability in respect of that personal injury would attachto a local authority which had been charged with the public lawduty of supervising compliance with the relevant building byelawsor regulations in respect of a failure properly to carry out suchduty. the cost of rectifying a defect in such an article which is exhypothesi no longer latent is difficult to accept. The suggested distinction between mere defect anddangerous defect which underlies the judgment of Laskin J. inRivtow Marine Ltd. v. Washington Iron Works [1973] 6 W.W.R. This argument therefore did not help the claimants in this case. The damage done here was notsolely economic loss. MURPHY (RESPONDENT) v. BRENTWOOD DISTRICT COUNCIL (APPELLANTS) Lord Chancellor Lord Keith of Kinkel Lord Bridge of Harwich Lord Brandon of Oakbrook Lord Ackner Lord Oliver of Aylmerton Lord Jauncey of Tullichettle LORD MACKAY OF CLASHFERN L.C. Others have beendistinguished in the Court of Appeal. In Anns the House of Lords approved, subject to explanation,the decision of the Court of Appeal in Dutton v. Bognor RegisUrban District Council [1972] 1 Q.B. The duty of the local authority was, as Lord Wilberforcestressed in the course of his speech in Anns, at p. 758, theordinary common law duty to take reasonable care, no more andno less. The defendant Local Authority failed to inspect the foundations of a building adequately, with the result that building became dangerously unstable. In the circumstances I do not consider it necessary to dealwith the question whether, assuming that the council were under aduty of the scope contended for by the plaintiff, they dischargedthat duty by acting on the advice of competent consultingengineers. However, in view of the importance of the course whichthey propose, I feel that I must briefly state my reasons foragreeing to that course. Since, however, this involvesdeparting from a seminal decision of this House which has stoodfor a considerable period and which has had the most profoundinfluence on the development of the law of negligence both in theUnited Kingdom and in other jurisdictions it is, I think, only rightthat I should also state my reasons independently. When LordWilberforce said that the the damages recoverable might includethose for damage to the house itself, it is clear that he wasreferring to damage separate from but caused by the defectivefoundations. sought to derive fromthose authorities. Anns, of course, does not go so far asto hold the builder liable for every latent defect which depreciatesthe value of the property but limits the recovery, and thus theduty, to the cost of putting it into a state in which it is nolonger an imminent threat to the health or safety of the occupant.But it is difficult to see any logical basis for such a distinction.If there is no relationship of proximity such as to create a duty toavoid pecuniary loss resulting from the plaintiff's perception ofnon-dangerous defects, upon what principle can such a duty ariseat the moment when the defect is perceived to be an imminentdanger to health? A series of decisions in thisHouse and in the Privy Council since Anns, however, have nowmade it clear beyond argument that in cases other than cases ofdirect physical injury the reasonable foreseeability of damage isnot of itself sufficient and that there has to be sought in additionin the relationship between the parties that elusive elementcomprehended in the expression "proximity" (see Governors of thePeabody Donation Fund v. Sir Lindsay Parkinson & Co. Ltd. [1985]A.C. 210; Yuen Kun Yeu v. Attorney-General of Hong Kong [1988]A.C. 175; Hill v. Chief Constable of West Yorkshire [1989] A.C. 53). But the position in law is entirelydifferent where, by reason of the inadequacy of the foundations ofthe building to support the weight of the superstructure,differential settlement and consequent cracking occurs. I can find no answer tothis conundrum. Like my noble and learned friend, Lord Keith, I prefer,in the absence of argument, to express no view as to whether thedefendants in truth did owe such a duty. 2d 284 in which the airline,having discovered defects in the engines fitted to some of theirplanes, fortunately before any accident occurred, chose not to suethe plane manufacturer in contract, but sued the enginemanufacturer in tort. 2302-2304, that a claim of thischaracter fell properly into the sphere of warranty under contractlaw. Anns v Merton Overruled. MURPHY v. BRENTWOOD DISTRICT COUNCIL [1990] 2 Lloyd's Rep. 467 HOUSE OF LORDS Before Lord Mackay of Clashfern, L.C., Lord Keith of Kinkel, Lord Bridge of Harwich, Lord Brandon of Oakbrook, Lord Ackner, Lord Oliver of Aylmerton and Lord Jauncey of Tullichettle. I have to say, with all respect, that I find it whollyunconvincing. Murphy v Brentwood District Council. But some conclusions are necessary if we are to dealwith the issue as to limitation.". The plaintiffs built the chimney as they didin reliance on that advice. Nevertheless, any new sub-category will form part of the English law of civil wrongsand must be consistent with its general principles.". To start with, if such a duty isincumbent upon the local authority, a similar duty must necessarilybe incumbent also upon the builder of the house. My Lords, I can see no reason why a local authority, byreason of its statutory powers under the Public Health Acts or itsduties under the building regulations, should be in any differentcase. Ltd. v. Home Office [1970] AC 1004, the position hasnow been reached that in order to establish that a duty ofcare arises in a particular situation, it is not necessary tobring the facts of that situation within those of previoussituations in which a duty of care has been held to exist.Rather the question has to be approached in two stages.First one has to ask whether, as between the allegedwrongdoer and the person who has suffered damage there isa sufficient relationship of proximity or neighbourhood suchthat, in the reasonable contemplation of the former,carelessness on his part may be likely to cause damage tothe latter - in which case a prima facie duty of care arises.Secondly, if the first question is answered affirmatively, itis necessary to consider whether there are anyconsiderations which ought to negative, or to reduce or limitthe scope of the duty or the class of person to whom it isowed or the damages to which a breach of it may give rise:see Dorset Yacht case [1970] AC 1004, per Lord Reid atp. Consideration of the nature of the loss suffered in thiscategory of cases is closely tied up with the question of when thecause of action arises. Thedecision of this House in Morrison Steamship Co. Ltd. v. GreystokeCastle (Cargo Owners) [1947] A.C. 265 demonstrates that the merefact that the primary damage suffered by a plaintiff is pecuniary. and Sachs L.J., to rest on the defendant'sability to control the building operation, from which it might beinferred that it was so involved in the operation as to be directlyresponsible for the defective foundations. All these considerations lead inevitably to the conclusionthat a building owner can only recover the cost of repairing adefective building on the ground of the authority's negligence inperforming its statutory function of approving plans or inspectingbuildings in the course of construction if the scope of theauthority's duty of care is wide enough to embrace purelyeconomic loss. 424, 487). and of Sachs L.J. Defects in such ancillary equipment ascentral heating boilers or electrical installations would be subjectto the normal Donoghue v. Stevenson principle if such defects gaverise to damage to other parts of the building. Furthermore, the cause ofaction would only arise when there was present or imminentdanger to the occupants. Facts. The High Court of Australiadeclined to follow Anns in Council of the Shire of Sutherland v.Heyman. As I have already said, I agree with Speight J. thatthe principles laid down in Donoghue v. Stevenson [1932]A.C. 562 apply to a builder erecting a house under acontract with the owner. To set a reading intention, click through to any list item, and look for the panel on the left hand side: The main argument of this very short essay is that as it stands today, it seems that the law on recovery of economic loss, though still confusing is now a bit clearer than it used to be. Iwould accordingly allow the appeal. That decision was taken aftervery full consideration by a committee consisting of most eminentmembers of this House. Lord Bridge's test for duty was put into practice in Murphy v Brentwood District Council [1990] 2 All ER 908. Lord Wilberforce went on, at pp. rejected asubmission that the damage was purely economic saying, at p. 396: "The damage done here was not solely economic loss. Upon Report from the Appellate Committee to whom wasreferred the Cause Murphy against Brentwood District Council,That the Committee had heard Counsel on Monday the 14th,Tuesday the 15th, Wednesday the 16th, Tuesday the 17th, Mondaythe 21st, Tuesday the 22nd and Wednesday the 23rd … Analogous tothat of the builder who builds a house from a house-builder who had a! Through latent defectsthat the duty is owed tothem - not of what the defendanthad done but of what it not! To bedefective and the local authority failed to give adequatesupport to floors or walls – pure economic loss ``! 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