LAW OF TORTS

GENERAL PRINCIPLES GOVERNING LAW OF NEGLIGENCE

INTRODUCTION
• First and foremost, negligence is the most important tort in modern law. It was first recognized in 1932
case of Donoghue v Stevenson, and concern breach of a legal duty to take care, with the result that
damage is caused to the plaintiff.
• Negligence is a tort which depends on the existence of a breach of duty of care owed by one person to
another. Thus, the tort of negligence is committed when a person fails to live up to the standard of care
expected of him, as a matter of law and someone else is injured or suffers loss as a result of that.
• The tort of negligence is distinct from negligence as a state of mind. It is essentially concerned with
compensating people who suffer loss from careless acts (or sometime omissions) of others, but it does
not provide a remedy for everyone who suffers. Negligence liability will only arise where the law provides
that the defendant owed the plaintiff a duty of care.
• The tort of negligence comprises of four elements:
(a) a duty of care
(b) breach of that duty
(c) damage resulting from the breach
(d) a compensable injury i.e., the damage is not too remote as is unforeseeable by a reasonable person.

DEFINITION OF NEGLIGENCE
• Negligence as a tort is a breach of a legal duty to take care, which result in damage, undesired by the
defendant, to plaintiff (Winfield & Jolowicz on Tort). In other words, it concerns breach of a legal duty to
take care, with the result that damage is caused to the claimant.
• This definition of negligence can be broken down into four component parts that a claimant must prove
to establish negligence. The legal burden of proving each of these elements falls upon the claimant. The
four elements are: (1) the claimant was owed a Duty of care; (3) there was a Breach of that duty of care;
(3) the claimant suffered damage as a result of that breach (Causation) and (4) the damage suffered was
not too Remote.
• In order to have a better understanding of the definition above, perhaps it is of paramount importance
to make reference to some few examples which might be brought in negligence are people injured in a
car accident who sue the driver, businesses which lose money because an accountant fails to advise them
properly, or patients who sue doctors when medical treatment goes wrong, etc.
• The word “negligence” may give rise to two meanings: Firstly, it may mean careless conduct i.e. I see
something on your table that attracts my attention, and I rush forward unthinkingly and in the course of
doing so, knock the table over and scatter your belongings; or secondly, negligence as a tort, which
comprises certain elements that need to be proved before liability may be established and damages
imposed on the tortfeasor. It is the latter meaning of negligence that the lecture will focus on.
• Furthermore, in the case of Blyth v Birmingham Waterworks Co (1856), Alderson B stated that
“negligence” is the omission to do something which a reasonable man, guided upon those considerations
which ordinarily regulate the conduct of human affairs, would do; or doing something which a prudent
and reasonable man would not do. See also the case of Lochgelly Iron and Coal Co v McMullan [1934]
AC 1, where Lord Wright defined negligence as: Negligence means more than heedless or careless
conduct... it properly connotes the complex concept of duty, breach and damage thereby suffered by
the person

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 • In short, negligence is established when three elements are fulfilled, firstly, there is a duty of care on the
part of the defendant, secondly this duty is breached by the defendant and thirdly, the breach results in
some damage to the plaintiff, although these elements are not necessarily exclusive of the other at all
times.
• All in all, it is generally true that damage suffered as a result of another person’s careless action or
inaction may give rise to the tort of negligence. However, this is not true all the time. The tort of
negligence requires proof of specific elements before the tort is established, despite carelessness on the
part of the defendant, and injury or damage sustained by the plaintiff.
• Note: The tort of negligence is distinct from negligence as a state of mind. It is essentially concerned with
compensating people who suffer loss from careless acts (or sometime omissions) of others, but it does
not provide a remedy for everyone who suffers. Negligence liability will only arise where the law provides
that the defendant owed the plaintiff a duty of care.

THE ELEMENTS OF NEGLIGENCE

There are basically four main elements of negligence as mentioned above. The four elements are:
• A duty of care;
• Breach of that duty;
• Damage resulting from the breach; and
• A compensable injury/ the damage is not too remote as is unforeseeable by a reasonable person.
DUTY OF CARE • The first element of negligence is the legal duty of care. This concerns the
relationship between the defendant and claimant (plaintiff), which must be such that
there is an obligation upon the defendant to take proper care to avoid causing injury
to the claimant in all the circumstances of the case.
• It is important to take note of the case of Donoghue v Stevenson (1932)- where the
‘duty of care’ principle was established by the court. Mrs. Donoghue consumed part
of a drink containing a decomposed snail while in a public bar in Paisley, Scotland
and claimed that it had made her ill. The snail was not visible, as the bottle of ginger
beer in which it was contained was opaque. Neither her friend, who bought it for
her, nor the shopkeeper who sold it were aware of its presence. The manufacturer
was Mr. Stevenson, whom Mrs. Donoghue sued for damages for negligence. She
could not sue Mr. Stevenson for damages for breach of contract because there was
no contract between them. The House of Lords agreed that the manufacturers owed
a duty of care to the end consumer of their products. The ginger beer manufacturers
had breached that duty, causing harm to Mrs. Donoghue, and she was entitled to
claim damages. Lord Atkin came up with the ‘neighbor principle’.
• Note: For the benefit of future cases, their Lordships attempted to lay down general
criteria for when a duty of care would exist. Lord Atkin stated that the principle was
that: (1) You must take reasonable care; (2) to avoid acts or omissions; (3) which you
can reasonably foresee; (4) would be likely to injure your neighbor.
• See also the case of Haley v London Electricity Board-where the defendants
excavated a trench in the street. They took precautions for the protection of passers-
by which were sufficient for normal sighted persons. However, the plaintiff who was
blind, suffered injury because of the precautions taken by the defendants were
inadequate for him. The court held that looking at the number of blind persons

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 walking about the streets alone was sufficient to require the defendants to have
them in contemplation and to take precautions appropriate to their condition.
• A duty of care is measured by the “reasonable person standard” (how a reasonable
person would have acted in the same circumstances).
• Example: (1) Where the defendant is a child, the standard of care is that of an
ordinary careful reasonable child of the same age. See the case of Mullin v Richards-
where the Court of Appeal held that the correct test was whether an ordinary careful
and reasonable 15-year-old would have foreseen that the game carried a risk of
injury. On the facts, the practice was common and was not banned in the school, and
the girls had never been warned that it could be dangerous, so the injury was not
foreseeable. (2) Where the defendant is a professional, the standard of care is what
is expected from a person of his/her profession or trade. See the case of Watson v
Gray-where the court stated that a professional footballer could only be liable for
negligently injuring another if a reasonable footballer would have known that what
the defendant did carried a significant risk of serious injury.
BREACH OF DUTY • The defendant is said to have committed a breach when he fails to take a reasonable
care to avoid the harm. Hence, even if the plaintiff can prove that the defendant
owed him a ‘duty of care’, the plaintiff may only sue for negligence if he can show
that the defendant breached that duty.
• It is important to note that the standard of care required in law, generally is the
standard of the reasonable person. We do not have to act perfectly. In imposing a
requirement on the defendant that he should have acted reasonably, the law is
judging him by an objective standard as mentioned above under duty of care. For
example, in assessing the standard of care to be expected in the areas where the
defendant is exercising special skill or knowledge, the courts have accepted that
within a given profession or trade there must be an ‘objective standard’ i.e. practise
across the board. (See the case of Bolam v Friern Barnet Hospital Management
Committee- where the plaintiff pelvis was broken during an electro-convulsive
treatment (ECT) and the plaintiff alleged negligence on three grounds (1) defendant
did not warn the plaintiff of the risk involved in an ECT treatment; (2) defendant did
not give the plaintiff any relaxant before the shocks were given to him; and (3)
defendant did not hold down the plaintiff’s body whilst the treatment was being
administered).
• See also the Malaysian case of Chin Keow v Government of Malaysia and Another
demonstrating a breach of a duty of care. In this case, an Amah was given a penicillin
injection at a clinic. She died about an hour later. The court held that the doctor had
been negligent as it was expressly written on the patient’s card that she was allergic
to penicillin.
• In addressing the breach of duty by the defendant, reference must also be made to
important points or issues such as: special characteristics of the plaintiff (i.e. a
reasonable person would have due regard to the fact that a plaintiff has some
characteristics or incapacity which increases the risk or harm- See the case of Haley
v London Electricity Board); magnitude of the risk (i.e. the greater the probability of
damage occurring, the more the law expects us to guard against it. Hence if the
magnitude of the risk is too small, the defendant may not be liable- See the case of
Bolton v Stone); and practicability of the protection/cost and practicability of

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 averting the risk (i.e. the magnitude of the risk must be balanced against the cost
and trouble to the defendant of taking the measures necessary to eliminate it. The
more serious the risk e.g. in terms of both foreseeability and degree of potential
harm, the more the defendant is expected to protect against it)- See the case of
Bourhill v Young- where a pregnant woman, suffered nervous shock when she heard
but did not see, a collision between the defendant and another road user.
DAMAGE • Before the plaintiff can succeed in an action in negligence, he or she must show that
RESULTING the injuries or damages complained of are a direct result of the defendant’s act of
FROM THE negligence. In other words, the breach of duty must cause the damage factually.
BREACH OF Here we have ‘causation in fact’ (whether the D’s conduct has in fact caused the
DUTY damage suffered by the P) and ‘causation in law’ (D will only be liable if it is
reasonably foreseeable that his conduct will result in some damage to the P).
• It is important to note that in order to determine this, the so-called ‘but for’ test is
used. If the harm to the plaintiff would not have occurred ‘but for’ the defendant’s
negligence, then that negligence is the cause of the harm. (See the case of Barnett v
Chelsea & Kensington Hospital Management Committee where a patient who had
been sent away by a doctor in the casualty department without an examination or
treatment, died from arsenic poisoning five hours later. The court held that breach
of duty did not cause his death. There was evidence that even if he had been
examined, it was too late for any treatment to save him, and therefore, it could not
be said that ‘but for’ the hospital’s negligence, he would not have died. The chain of
causation must not be broken by an intervening event (novus actus interveniens))
• It should be noted that in some cases there may be more than one cause of damage
(multiple causes), with the defendant’s conduct one among them. This has proved a
difficult area for the courts, and the cases are contradictory. (See the case of McGhee
v National Coal Board-the House of Lords held that where the defendant’s
negligence made some substantial contribution to the injury, they could be liable,
and it was not necessary to prove that there negligence was the sole cause). In this
case of McGhee v National Coal Board- the plaintiff contracted dermatitis as a result
of exposure to brick dust. Due to inadequate washing facilities at the defendant’s
factory, this meant that the plaintiff was still in contact with the dust whilst he was
cycling home. The defendant was not guilty exposing the plaintiff to the dust during
working hours but were held liable for the prolonged exposure.
• Take note that the court came with a different decision altogether in Wilsher v Essex
Area Health Authority. The House of Lords held that the plaintiff had to prove, on a
balance of probability, that the defendant’s breach of duty was a material cause of
the injury; it was not enough to prove that the defendant had increased the risk that
the damage might occur, or had added another possible cause to it. On the facts of
the case, the defendant’s negligence was only one of the possible causes of the
damage, and this was not sufficient to prove causation. In the case above, the
plaintiff’s blindness could have been caused either by the negligent administration
of excess oxygen by the doctor or by any one of the five other conditions which
afflicted the plaintiff at the time.
• Still on the issue of damage resulting from the breach, it is important to also make
reference to a situation whereby the damage is caused by more than one defendant
i.e. say two defendants. It should be noted that when two or more parties

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 concurrently caused an accident, and there is no prove as to the degree of each
party’s contribution to the damage, both defendants may be jointly liable for
damages. (See the case of Ong Yam Chong & Anor v Chan Wah).
• It is equally important while addressing the issue of damage resulting from the
breach, reference must be made to a situation whereby events which caused the
damage or injury comes one after another. In this kind of a scenario, it is possible
that the second event may break the chain of causation of the first.
DAMAGE IS NOT • The greater the probability of damage occurring, the more the law expects us to
TOO REMOTE AS guard against it. A defendant is not negligent if the damage was not a foreseeable
IS consequence of his conduct. (See the case of Bolton v Stone-Plaintiff, standing in the
UNFORSEEABLE road, was struck by a cricket ball which had travelled 100 yards. Evidence established
BY A that balls had been hit out of the ground on five or six occasions in the preceding 30
REASONABLE years. The House of Lords held that the defendant was not liable because in the
PERSON circumstances it was reasonable to ignore such a small risk). However, in Miller v
Jackson- the probability of cricket ball being hit over the plaintiff’s garden fence and
damaging brickwork and titles was sufficiently high for the defendant to be in breach
of duty.

DUTY OF CARE
• The first element in the claimant’s case is whether the defendant owed him a duty to take reasonable
care. It is accepted that negligence does not exist in a vacuum and that there is no all-embracing duty
owed to the whole world in all circumstances. If it were otherwise, a person who saw someone walking
near the top of a cliff could be liable if they then failed to shout a warning and there was a fall.
• Duty of care, therefore, exists as a control device in order to determine who can bring an action for
negligence and in what circumstances. See the case of Heaven v Pender (1883), where the Court of
Appeal held that if a person contracts with another to use ordinary care or skill towards him or his
property, that is a contractual obligation and need not be considered in the context of a duty. However,
there may be the obligation of duty from one person to another although there is no contract between
them with regard to such duty. The existence of this duty is independent of any contractual duty. See for
example one road user to another and many more.
• Duty in the tort of negligence means duty as imposed by the law, or legal duty. It is only the breach of
this kind of duty and its resulting damage that may give rise to liability in negligence. The breach of a
moral or social duty generally does not give rise to liability in negligence. For instance, if A, a customer
at a supermarket notices a banana skin on the floor of the supermarket but he chooses to walk past it,
and B, who is in a hurry slip on the banana skin and injures himself, A does not owe a legal duty to warn
B or dispose of the banana skin. A only has a social or moral duty, which is not enforceable by the law.
There is generally no duty to rescue a stranger from danger (see the case of Stovin v Wise [1996] AC
923). However, the proprietor of the supermarket would not be in the same position as A, for he is in a
position where he ought to know that leaving an object on the floor of the supermarket could well cause
injury to a customer.
• All in all, negligence is essentially concerned with compensating people who have suffered damage as a
result of the carelessness of others, but the law does not provide a remedy for everyone who suffers in
this way. One of the main ways in which access to compensation is restricted is through the doctrine of
the duty of care. Essentially, this is a

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 • legal concept which dictates the circumstances in which one party will be liable to another in negligence:
if the law says you do not have a duty of care towards the person (or organization) you have caused
damage to, you will not be liable to that party in negligence, no matter how serious the damage.

THE TEST FOR DETERMINING THE EXISTENCE OF A DUTY OF CARE

• First and foremost, there are two ways in which duty of care may be established: (i) The defendant and
claimant are within one of the ‘special relationships’; or outside of these relationships, according to the
principles developed by case law. Hence, the two tests are: EITHER (test one), demonstrating that the
situation under consideration falls within a category of duty that has already been established by
precedent; OR (test two) if the situation is one which has not yet been categorized under test one,
establishing that one or more of three factors is present-foresight, proximity and justice.
• In addition to the above, it is vital to note that there are a number of situations in which the courts
recognize the existence of a duty of care. These usually arise as a result of some sort of ‘special
relationship’ between the parties. Examples include: one road-user to another, employer to employee,
manufacturer to consumer (see Donoghue v Stevenson), doctor to patient, solicitor to client. All these
are called ‘Established Duty Situations’.
• Furthermore, outside of these categories of established duty, a duty of care will be determined on the
basis of individual circumstances. The ‘neighbor principle’ formulated by Lord Atkin in Donoghue v
Stevenson [1932] AC 562 was initially used to determine whether a duty of care existed between
defendant and claimant.

1.THE NEIGHBOUR PRINCIPLE

• The primary test or principle used in determining the existence of a duty of care is the well-known
‘neighbour principle’. This principle was laid down in the landmark case of Donoghue v Stevenson- where
Mrs Donoghue and a friend visited a café. Mrs Donoghue’s friend bought her a bottle of ginger beer. The
bottle was made of opaque glass. When filling Mrs Donoghue’s glass, the remains of a decomposed snail
which had somehow found its way into the bottle at the factory floated out. Mrs Donoghue developed
gastroenteritis as a result and suffered shock and was severely ill as a consequence. She sued the
manufacturer of the ginger beer in negligence as she had no contract with either the retailer or the
manufacturer. The House of Lords held that the manufacturer owed her a duty to take care that the
bottle did not contain foreign bodies which could cause her personal harm. This is known as the narrow
rule in Donoghue v Stevenson that a manufacturer of goods owes a duty of care to their ultimate
consumer.
• More importantly, the case establishes the neighbour principle which determines whether the
defendant owes a duty of care in any situation. Lord Atkin stated: You must take reasonable care to avoid
acts or omissions which you can reasonably foresee would be likely to injure your neighbour. Who, then,
in law is my neighbour? The answer seems to be persons who are so closely and directly affected my act
that I ought reasonably to have them in my contemplation as being so affected when I am directing my
mind to the acts or omissions which are called in question.
• The decision in the case of Donoghue v Stevenson is important for two reasons. Firstly, it created a new
category of duty, owed by the manufacturer to the consumer, and secondly, the court had taken into
account new technology, which was mass production, in the imposition of liability for negligence.
Whereas before Donoghue v Stevenson, the courts would insist on a pre-existing contractual relationship
between the parties before a duty of care could arise, this was no the case. The decision signified that
the categories of negligence are not closed or limited.

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 • The neighbour principle is an objective test in the sense that the court will ask the hypothetical question:
would a reasonable man, who is in the same circumstances as the defendant, foresee that his conduct
will adversely affect the plaintiff? If the answer is ‘no’, the plaintiff is not a neighbour of the defendant
and no duty of care arises. Conversely, if the answer is ‘yes’, this means that the plaintiff is a neighbour
of the defendant and the latter owes the former a duty of care.
• The word ‘closely and directly affected by my act’ in the quotation above does not necessarily mean
close in the physical sense. ‘Closely’ refers to the foresight of a reasonable man who is able to foresee
that the plaintiff will be affected by the defendant’s act or omission. If D runs over X and X is seriously
injured and P, who is X’s spouse, suffers nervous shock upon visiting X at the hospital an hour after the
incident, P is not a person who is at all ‘close’ to the scene of the accident in the physical sense. This is
because P was nowhere at the scene of the accident. Yet P is deemed ‘close’ because P is a person who
a reasonable man may foresee, will be affected by D’s act.
• It is important to note that the ‘neighbour principle’ need not be applied in all cases in determining a
duty of care. This is not because a different test applies, but because there already exist, many cases and
thus situations, in which the courts have recognised the existence of duty of care (see some of examples
mentioned above under ‘established duty situations’).
• In addition to the above, conversely, there exist situations in which the law has denied duty. For example,
you are at liberty not to warn me that the chair I clearly intend to sit on is broken. It does not matter that
a reasonable man in your position would have foreseen (and for that matter, you yourself), that I would
clearly be injured if I sat on the chair.
• Having said that, in whichever situation, whether a duty of care already exists or is denied to exist, the
neighbour principle is a useful starting point.
• It is important to note that Lord Atkin ‘neighbour principle’ was approved in Home Office v Dorset Yacht
Co Ltd [1970] AC 1004, where it was stated that that the ‘neighbour principle’ ought to be used in order
to determine the existence of a duty of care unless there are good reasons or justification for its
exclusion. In this case, seven boys (borstal trainees) had escaped from an Island due to the negligence of
some borstal officers. The boys caused damage to a yacht and its owner sued the Home Office. The issue
was whether the Home Office or its officers owed any duty of care to the owner of the yacht to which
the court answered in the affirmative. Lord Reid said: “Donoghue v Stevenson may be regarded as a
milestone, and the well-known passage of Lord Atkin’s speech should, I think, be regarded as a statement
of principle… It will require qualification in new circumstances. But I think the time has come when we
can and should say that it ought to apply unless there is some justification or valid explanation for its
exclusion”.

2.THE TWO-STAGE APPROACH/THE ANS TEST

• First and foremost, it is of paramount importance to note that Lord Reid’s suggestion was taken up in
Anns v Merton London Borough Council [1978] AC 728. In this case, the plaintiff bought a house from a
developer in 1962. In 1970, cracks appeared in the walls of the house and the floor became uneven.
These defects were due to a defect in the foundation of the house. The plaintiff sued the builders and
the local authority for negligence, for its failure to properly inspect the foundation of the house and for
its negligence in failing to detect the defect when conducting examination of the foundation. The local
authority stated that they were not under any duty to inspect the foundation and if they could not be
liable for failure to inspect, they could not be held liable for any negligent inspection. Lord Wilberforce
held that in order to determine whether a duty of care existed in a particular situation, the facts need

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 not fit into any existing category in which a duty of care has been held to exist. His Lordship created his
now discredited test as follows:
• Firstly, it must be determined whether there is a sufficient relationship of proximity or neighbourhood
between the alleged tortfeasor and the person who has suffered the loss. If it can be ascertained that
the tortfeasor should have foreseen that carelessness on his part may cause damage to the other party,
prima facie, a duty of care would be established.
• Secondly, if the answer to the above is in the affirmative, the court then has to examine whether there
are any considerations that may negate, reduce or limit the scope of the duty, or the group of persons
to whom the duty will be imposed.
• In addition to the above, the first stage is in substance the same as Lord Atkin’s neighbour principle. On
the other hand, the second stage involves the defendant raising any policy considerations that need to
be taken into account, which may have the effect of negativing or limiting the imposition of a duty of
care. On the facts of Anns case, the House of Lords held that the defendant owed a duty of care to ensure
that the laws were complied with in the construction of the foundation of the building, and since this
duty was not fulfilled, the defendant was liable to compensate the plaintiff.
• The two-stage approach expounded by Lord Wilberforce in essence means that once it is reasonably
foreseeable that the defendant’s act or omission may cause damage to the plaintiff, there is a
presumption of the existence of a duty of care. This duty will only be reduced or negatived if there are
policy factors which require the reduction or negation of that duty.
• It is important to note that this two-stage approach, hereinafter referred to as Anns test, was initially
received with enthusiasm and was seen as an advancement in the law. Its application led to the
expansion of the boundaries of liability for psychiatric harm (see the case of McLoughlin v O’Brian [1982]
2 All ER 298) but particularly in allowing claims for pure economic loss.
• It is equally vital to note that the height of the application of the Anns test and Lord Reid’s judgment in
Home Office may be seen in Junior Books Ltd v Veitchi Co Ltd [1983] 1 AC 520. In this case, the
defendants were found liable to the plaintiffs for the costs incurred by the plaintiffs in reflooring their
factory due to the defendants’ initial negligence in laying an uneven floor. The House of Lords held that
the defendants were experts and they should have known that the plaintiffs would rely on their advice
and expertise; and further that it was clear and obvious that it was reasonably foreseeable that the
plaintiffs would suffer some damage or loss if the defendants were negligent. The difficulty with this
decision lies in the fact that although the floor was defective, it was not dangerous. There was no damage
to
• In addressing the Anns test, it has to be pointed out that the test received heavy criticism after Junior
Books and in Governors of the Peabody Donation Fund v Sir Lindsay Parkinson & Co Ltd [1985] AC 210;
[1984] 3 All ER 529, the court warned against treating the Anns test as being definitive. The court further
stated that a relationship of proximity or neighbourhood in accordance with the principle laid down by
Lord Atkin must be proved before a duty of care is said to exist, but the scope of the duty of care is
dependent on the facts of each case. In determining whether a duty of care will be imposed on a
defendant, the court must consider whether it is just and reasonable to do so. In considering this ‘just
and reasonable’ element in the imposition of a duty of care, it is the plaintiff, and not the defendant;
who has to identify and justify on policy grounds, that a duty exists.
• In Peabody’s case a drainage system to a building was defective, and the local authority which was in
charge of overseeing the construction of the drainage system, was found to have been aware of the fact
that the approved plan to the drainage system was not adhered to with the result that the completed
drainage system had to be reconstructed. The plaintiffs who were the owners of the building, sued the

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 local authority, alleging that the latter had breached their duty in not ensuring that the approved plans
were adhered to. The House of Lords held that the local authority did not owe such a duty to building
owners. Thus, foreseeability of harm per se does not automatically give rise to a duty of care.
• Also, in Leigh & Sillavan Ltd v Aliakman Shipping Co Ltd [1986] 2 All ER 145, it was held that the Anns
test as expounded by Lord Wilberforce should not be treated as a universal test in determining the scope
of a duty to take care in the tort of negligence. In claims for economic loss, a person may only claim
successfully for loss incurred by him as a result of damage to his person or his property. The claimant
must have a current proprietary interest in the damaged property. There is no duty in
• See also the case of Yuen Ku-Yeu v AG of Hong Kong [1987] 2 All ER 705. In this case, the plaintiffs
deposited large sums of money with a deposit-taking company. The deposit-taking company was
registered as such by a statutory officer, the Commissioner of Deposit-Taking Companies (the
defendant). The company then went into liquidation with the result that the plaintiffs lost all their
money. The plaintiffs alleged that the Commissioner knew or ought to have known that the company
was conducting its affairs fraudulently and therefore the Commissioner should not have registered the
company or should have revoked its licence. The Privy Council held that the Commissioner did not owe
the plaintiffs a duty of care for many reasons, amongst which were that the plaintiffs were unascertained
members of the public, the loss was inflicted by the act of a third party (which was the deposit-taking
company) and the Commissioner did not owe a duty to protect the public against such loss which was
purely economic in nature.
• All in all, Lord Keith said that the Anns test as laid down by Lord Wilberforce had been given more
importance than it ought to and that in future cases, this test need not be applicable and relevant in
establishing the existence of a duty of care. To Jones, he observed that this approach represented a shift
of emphasis rather than a new substantive test for the existence of duty of care, not by going through
the Anns stage-be-stage approach, but by looking at the nature of the relationship between the parties
as a whole including policy considerations, to see if there is a sufficient degree of proximity between the
parties.
• See also the case of Rowling v Takaro Properties Ltd [1988] 1 All ER 163, where the court was of the
view that before concluding that a duty of care should be imposed, all the relevant circumstances need
to be considered. A too literal application of the Anns test may lead to a failure to have regard to, and to
analyse and weigh all the relevant considerations in considering whether it is appropriate to impose a
duty of care.

3.THE CAPARO (COMPOSITE) TEST

• The retreat from Anns was finally concluded in Caparo Industries plc v Dickman [1990] 1 All ER 568-
where Lord Bridge acknowledged that the law’s tendency had reverted to the traditional categories of
recognisable situations in the imposition of a duty of care. This does not mean that a plaintiff, in order
to establish duty, must prove that his situation falls squarely into any of the recognised categories.
Instead, what the plaintiff needs to establish, is that a duty of care arises in his situation because it
accords with existing policy and decisions in analogous cases. In other words, the basic concept of the
‘neighbour principle’ was reconsidered in Caparo Industries plc v Dickman. The Caparo’s case considered
the liability of an auditor for financial loss suffered by investors. However, it also set out the three points
which a court must consider to establish whether a duty of care exists. The three points are: (i)
Reasonable foresight of harm; (ii) sufficient proximity of relationship; and (iii) That it is fair, just and
reasonable to impose a duty.

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 • Based on the three points mentioned above, there is no doubt that the test requires the court to ask
three questions: (i) Was the damage reasonably foreseeable? (ii) Was there a relationship of proximity
between the defendant and claimant? (iii) Is it just, fair and reasonable to impose a duty in this situation?
• Having said that, it is vital to note that in many situations one or more of these elements may overlap,
and so the test is not always applied as a clear, three-step process.
• Back to the three questions, perhaps it is vital to briefly point out how these elements operate for sake
of better understanding: (i) Reasonable foreseeability. This element of the test has its foundation in the
original ‘neighbour principle’ developed in Donoghue v Stevenson. Essentially, the courts have to ask
whether a reasonable person in the defendant’s position would have foreseen the risk of damage.
• Back to the three questions, perhaps it is vital to briefly point out how these elements operate for sake
of better understanding: (i) Reasonable foreseeability- This element of the test has its foundation in the
orginal ‘neighbour principle’ developed in Donoghue v Stevenson. Essentially, the courts have to ask
whether a reasonable person in the defendant’s position would have foreseen the risk of damage. A
modern case which show how this part of the test works is Langley v Dray (1998), where the claimant
was a policeman who was injured in a car crash when he was chasing the defendant, who was driving a
stolen car. The Court of Appeal held that the defendant knew, or ought to have known, that he was being
pursued by the claimant, and therefore in increasing his speed he knew or should have known that the
claimant would also drive faster and so risk injury. The defendant had a duty not to create such risks and
he was in breach of that duty.
• It is important to note that in order for a duty to exist, it must be reasonably foreseeable that damage or
injury would be caused to the particular defendant in the case, or to a class of people to which he
belongs, rather than just to people in general. In other words, the,

➢ Reasonable foreseeability-
o It is important to note that in order for a duty to exist, it must be reasonably foreseeable that damage or
injury would be caused to the particular defendant in the case, or to a class of people to which he
belongs, rather than just to people in general. In other words, the duty is owed to a person or class of
persons, and not to the human race in general. See the case of Palsgraf v Long Island Railroad (1928).
However, this does not mean that the defendant has to be able to identify a particular individual who
might foreseeably be affected by their actions; it is enough that the claimant is part of a class of people
who might foreseeably be affected. See the case of Haley v London Electricity Board (1965).

➢ Proximity-
o In normal language proximity means closeness, in terms of physical position, but in law, it has a wider
meaning which essentially concerns the relationship, if any, between the defendant and the claimant.
See the case of Yuen Kun Yeu v AG of Hong Kong [1988] AC 175, where Lord Keith referred to proximity
as a synonym for foreseeability on the one hand, and on the other as referring to the whole concept of
relationship between the claimant and the defendant.
o See the case of Muirhead v Industrial Tank Specialities (1985), where Goff LJ pointed out that this does
not mean that the defendant and the claimant have to know each other, but that the situations they
were both in meant that the defendant could reasonably be expected to foresee that his or her actions
could cause damage to the claimant. In this sense, proximity can be seen as simply another way of
expressing the foreseeability test, as the case of Caparo v Dickman itself shows.
o Proximity may also be expressed in terms of a relationship between the defendant, and the activity
which caused harm to the claimant, defined by Lord Brennan in Sutradhar v Natural Environment

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 Research Council (2004) as ‘proximity in the sense of a measure of control over the responsibility for
the potentially dangerous situation’.
o It may also be expressed in terms of a relationship between the defendant, and the activity which caused
harm to the claimant. An example of this kind of proximity can be seen in Watson v British Boxing Board
of Control (2000), where the claimant was the famous professional boxer Michael Watson, who suffered
severe brain damage after being injured during a match. He sued the board, on the basis that they were
in charge of safety arrangements at professional boxing matches, and evidence showed that if they had
made immediate medical attention available at the ringside, his injuries would have been less severe.
The Court of Appeal held that there was sufficient proximity between Mr Watson and the Board to give
rise to a duty of care, because they were the only body in the UK which could licence professional boxing
matches, and therefore had complete control of and responsibility for a situation which could clearly
result in harm to Mr Watson if the Board did not exercise reasonable care.

➢ Justice & reasonableness-

o In practice, the requirement that it must be just and reasonable to impose a duty often overlaps with
the previous two- in Watson and Sutradhar, for example, the arguments made under the heading of
proximity could equally well be seen as arguments relating to justice and reasonableness. It was
obviously more just and reasonable to expect the Boxing Board to supervise a match properly, since that
was their job, than it was to expect the researchers in Sutradhar to take responsibility for a task that was
not their job, and which they had never claimed to have done.
o It is important to note that where justice and reasonableness are specifically referred to, it is usually
because a case meets the requirements of foreseeability and proximity, but the courts believe there is a
sound public policy reason for denying the claim. An example is McFarlane v Tayside Health Board
(1999), where the claimant had become pregnant after her partner’s vasectomy failed, and claimed for
the costs of bringing up the child. The courts denied her claim, on the basis that it was not just and
reasonable to award compensation for the birth of a healthy child- something

THE TEST FOR DETERMINING THE EXISTENCE OF A DUTY OF CARE (CONTINUATION)

• Having addressed the test for determining the existence of a duty of care above, it is equally important
to turn the attention to the situation in Malaysia. In Malaysia, the application of this test to ascertain the
existence of duty of care has generally been more straightforward. An early example of the application
of the ‘neighbour principle’ is Sathu v Hawthornden Rubber Estate Co Ltd [1961] MLJ 318, where 19
heads of cattle which belonged to the plaintiff strayed onto the estate of the defendant whilst grazing.
The estate had been sprayed with sodium arsenite a few days earlier and as a result of grazing on the
contaminated grass, the complete herd died a few days later. The plaintiff alleged that the defendant
had committed a breach of their common law duty to a ‘neighbour’ under the principle in Donoghue v
Stevenson. It was held that in order to be liable under the principle in Donoghue v Stevenson, the
defendant company must be shown to have been aware that the plaintiff’s cattle, and not any cattle,
were likely to stray on their estate. Since this fact was not reasonably foreesable by the defendant, they
owed no duty of care to the plaintiff and was therefore not liable for the injury to the plaintiff’s cattle.
• See also the case of Lok Kwan Moi & Ors v Ramli bin Jamil & Ors & Government of Malaysia [1984] 1
MLJ 46. In this case, during the Chinese New Year the police conducted raids on boats tied up at the
Muar river front where a number of fishermen were gambling. The majority of the fishermen jumped
into the river and the police party lined the bank shouting at them to come up to be taken away. Most
of the fishermen came to shore and were arrested, except the deceased, who appeared to be having

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 difficulty in the water. A passing fishing boatman who realised his distress tried to pick him up but the
approaching boatman was deterred from the act of rescue by a shout from the leader of the police party
who warned the boatman not to interfere or otherwise he would be arrested. The fishing boat
accordingly pulled away and the man struggling in the water went down. In an action against the
policeman and the government by the deceased’s personal representatives, the court held that the
policeman who uttered the threat ought to have known and foreseen as any reasonable man would have
known and foreseen, that this threat would deter the boatman from the act of rescue. The policemen
and vicariously the government were found to be 75% liable.
• See also the case of Sivakumaran a/l Selvaraj & 2 Ors & Anor v Yu Pan & Anor [1995] 1 AMR 490, where
it was held that the test of duty is foreseeability of some damage to the plaintiff and the test of damage
is that the kind and extent of the damage should be foreseeable in general. No mention or reference was
made as to whether the court ought to have considered, before imposing a duty of care, that it would
be just and reasonable to do so. This test of duty was appropriate in this case as the defendant’s negligent
act had caused personal injuries to the plaintiff, and so there was no need for the court to consider other
factors other than foreseeability of damage.
• It is important to note that foreseeability of damage continued to be the prerequisite for the imposition
of a duty of care in subsequent cases e.g. in Zazlin Zahira v Louis Marie & 2 Ors [1994] 4 CLJ 637, where
the court held that a class teacher could not have foreseen injury in a music class. See also the case of
Champion Motor Sdn Bhd v Tina Travel & Agencies Sdn Bhd [1997] 1 AMR 809, where the court held
that a seller should have foreseen pure economic loss to plaintiff as a result of a defect in title of the
vehicle sold.
• Regardless of the above sentiment, this test of foreseeabilty was discarded in Uniphone Sdn Bhd v Chin
Boon Lit & Anor [1998] 6 MLJ 441, where the court held that the combined decisions in Donoghue v
Stevenson ; Peabody and Yuen Kun-Yeu which led to the threefold test in Caparo Industries, applied in
Malaysia. Thus following Caparo Industries, the test in determining duty of care is no longer limited to
the foreseeability of damage alone, but it further requires a consideration of the proximity of the
relationship between the parties; and whether in the circumstances it is fair, just and reasonable to
impose a duty of care. See the application of this three-criteria test justifying claims for pure economic
loss in Steven Phoa Cheng Loon & 72 Ors v Highland Properties Sdn Bhd & 9 Ors [2000] 3 AMR 3567.
• Having said that, the question that arises is, does the Caparo/Uniphone test apply in all situations, or
only where the damage is purely economic in nature? The Court of Appeal in Arab-Malaysian Bank v
Steven Phoa Cheng Loon & Ors [2003] 2 AMR 6, did not refer to the Caparo/Uniphone criteria in
determining
• Still on the decision of the above case, the court held that foreseeability of such loss on the basis of the
neighbour principle was sufficient. However, the Federal Court in Majlis Perbandaran Ampang Jaya v
Steven Phoa Cheng Loon & Ors [2006] 2 MLJ 389 referred to Caparo in determining the scope of a duty
of care in pure economic loss claims, although in the particular circumstances of the case, other kinds of
harm were not discussed.
• Perhaps in cases where the plaintiff suffers physical damage, either to his person or property, the ‘mere’
foreseeability test is to be preferred. Even if the Caparo/Uniphone test is applied, in considering the third
criteria of ‘just and reasonable’, perhaps it is only in exceptional circumstances that the answer should
be- it is not just and reasonable to impose a duty of care on the defendant.
• All in all, where the plaintiff sustains damage to his property, it has been held that if such damage is
foreseeable, the plaintiff is deemed to be the defendant’s ‘neightbour’, and accordingly a duty is owed
to him. For example, a defendant who discharged effluent from his oil processing factory into a river,

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 causing water pollution resulting in the plaintiff’s fish downstream dying was held to have the requisite
proximity (see the case of Eng Thye Plantation Bhd v Lim Heng Hock & Ors)

EXCEPTIONS TO DUTY OF CARE

• First and foremost, even though a duty of care exists as foreseeability and proximity are satisfied, liability
is nonetheless excluded on grounds of public policy. Public policy is a flexible tool. It extends to moral,
social, economic and political factors and essentially comprises of decisions either by the legislature or
the courts, which have an impact on the overall goal of the entire society on a particular issue. Hence, it
is vital to make reference to the following situations:
1.OMISSION • The difference between an act and an omission as a legal wrong is that in the former,
a positive act of the defendant causes harm to the plaintiff, but in the latter, inaction
on the part of the defendant causes harm to the plaintiff.
• It is important to note that the general rule states that an omission does not give rise
to a duty of care. In other words, the general principle is that a person must not harm
others, but at the same time he does not owe a duty of care to do something for the
benefit of another. See the case of Smith v Littlewoods Organisation Ltd [1987] 1 All
ER 710, where the defendant who owned a cinema intended to demolish it and build a
supermarket. The property was empty
• Still on the case of Smith v Littlewoods Organisation Ltd. This fact was unknown to the
defendant. Some vandals started a fire in the cinema and the fire spread and destroyed
two adjoining properties. The plaintiffs as owners of the destroyed properties, sued the
defendants. The House of Lords rejected the plaintiffs’ claim and stated that the
defendants’ omission to prevent third parties from causing damage did not give rise to
a duty of care in the circumstances as it was not reasonably foreseeable that the
vandals would enter the empty building. The negation of a duty of care was further
compounded by the fact that the defendants were not aware of the entries made by
vandals into his cinema.
• Regardless of the general rule or principle addressed above, there are however,
instances where omission may give rise to liability e.g. where the omission is contrary
to an existing duty to act (defendant has a duty to act and he does not do so); where
there exists a special relationship between the plaintiff and the defendant (employer
and his employee, doctor-patient, parent-child); where an omission will give rise to a
duty of care in a situation where the defendant has control over a third
2.STATUTORY • The exercise of functions and powers by government agencies and organisations are
POWERS mostly derived from statutes. In order to determine the powers extent and the
limitations set, reference must be made to the provisions in the particular statutes.
• Public authorities are usually given discretion in carrying out their statutory duties. If
the authority concerned acts or omits to act in a particular way as the case may be, and
the act or omission falls within the discretionary power of the authority, it is very likely
that the courts will hold the authority not liable, as opposed to the authority not doing
something which is required of it as a duty.
• Having said that, it is still vital to note that statutory powers will however not protect
the defendant if the act or omission complained of exceeds its authority or is ultra vires.
3.PSYCHIATRIC • It includes all forms of mental illness, neurosis and personality change that are
ILLNESS medically recognised. This must be differentiated from severe fear or emotional

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 distress, grief or sorrow, which by themselves do not give rise to liability except where
the fear, distress, grief or sorrow lead to either a physical illness, such as hypertension,
heart attack or a positive psychiatric illness such as anxiety neurosis or reactive
depression. Psychiatric illness may occur either as a result of a deliberate act which is
intentional in nature, or from negligence. For example, if the act is done intentionally,
the principle in Wilkinson v Downton will apply.
• The courts have been cautious in holding that a duty of care exists in cases where the
type of damage suffered by the plaintiff is one of nervous shock, though the preferred
expression now is ‘psychiatric injury or illness’. Even though psychiatric illness is in
principle recoverable, the courts have always been reluctant and cautious in awarding
compensation. There are several reasons for this, the difficulty in assessing injury or
damage in monetary value; the difficulty in determining the truth of the plaintiff’s
allegation; etc. See the case of Alcock v Chief Constable of South Yorkshire Police
[1992] 1 AC 310; [1991] 4 All ER 907 stating the current law on psychiatric injury or
4.PURE • Court have been generally cautious before imposing a duty of care on the defendant
ECONOMIC when the damage suffered by the plaintiff is in the form of pure economic loss.
LOSS Economic loss means pecuniary or financial loss. Economic loss incurred as a result of
physical injuries or damage to property is usually recoverable. Where the economic
loss is independent of the physical injuries or damage to property, the courts have
adopted a restrictive approach. Policy reasoning plays a large role in this approach and
as a general rule, the courts would only allow claims where there exists a special
relationship between the parties concerned.
• Perhaps it is important to point out here that, a ‘special relationship’ is said to exist
when there is an assumption of responsibility by the defendant towards the plaintiff.
This in turn may be in the form of advice or services provided and there is no longer
any clear distinction in the levels of duty owed between the two. Traditionally, pure
economic loss may be incurred either as a consequence of a negligent misstatement or
negligent act.

FORESEEABLE DUTY OF CARE

• The concept of foreseeability is the foundation of the neighbour principle, for it is only when damage to
the plaintiff is foreseeable that a duty of care arises on the part of the defendant, and vice versa.
• The word ‘foreseeability’ is often used interchangeably with ‘proximity’. A plaintiff who suffers harm as
a result of the defendant’s act might not be able to recover say damages because he is not a foreseeable
victim. He is not a foreseeable victim because there is no proximity between the parties. Thus,
foreseeability includes proximity.
• Having said that, it would suffice to note that one’s physical neighbour would obviously fall within the
scope of foreseeable potential victim to raise a duty of care. See the case of Kris Angsana Sdn Bhd v Eu
Sim Chuan [2007] 5 MLJ 13, where the negligent defendant was conducting piling activities and
excavation works on their land in order to build two 20-storey condominiums. It did not take any
precautionary or preventative measures prior to construction to ensure that the plaintiff’s neighbouring
bungalow was not affected. Movement and settlement of the underground soil caused structural
damage to the bungalow and cracks appeared on
• Regardless of the scenario cited above, it is equally important to note that ‘foreseeability’ does not
always necessarily mean physical nearness. For example, two persons may be physically near each other

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 and yet there is no duty of care as one may not expect the presence of the other at the material time.
See the case of Bourhill v Young [1943] AC 92-where the plaintiff, a pregnant woman, suffered nervous
shock when she heard but did not see a collision between the defendant and another road user. The
House of Lords held that the defendant did not owe a duty of care to the plaintiff. This was because the
plaintiff was outside the area of foreseeable harm and the possibility of her being affected by the collision
was consequently not foreseeable. See also the case of Palsgraf v Long Island Railroad Co addressing
similar principle.
• The fact that the plaintiff must be a foreseeable victim does not mean that the plaintiff himself must be
identifiable by the defendant. It is enough for the plaintiff to be a member of a class or persons to whom
damage is foreseeable. See the case of Haley v London Electricity Board [1964] 3 All ER 185.

CONCLUSION
• The first consideration in any negligence action is whether the claimant was owed a duty of care by the
defendant. In other words, the first element of negligence is the legal duty of care. This concerns the
relationship between the defendant and claimant, which must be such that there is an obligation upon
the defendant to take proper care to avoid causing injury to the claimant in all the circumstances of the
case. Unless it is possible to establish this in particular circumstances of the case, there will be no point
in considering whether an act or omission which has resulted in harm was negligent.

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