From: Neil Foster [mailto:neil.foster@newcastle.edu.au]
Sent: Tuesday, 8 March 2016 9:05 AM
To: Gerard Sadlier; Jason Neyers
Cc: obligations@uwo.ca
Subject: Re: Limitation Period for Negligently Caused Financial Loss

Dear Ger;

There is a brief summary of some of the authorities in the 7th edition of Luntz & Hambly et al Torts Cases and Commentary (LN Butterworths, 2013) paras 5.2.8-5.29. Herewith:

 

 5.2.8 Th ere are many cases of apparent property damage that are better analysed as cases of pure

economic loss. Time would then start to run from the suff ering of the economic loss, which would

usually be on discovery of the defect: see the analysis of the Australian cases in Cyril Smith & Associates

Pty Ltd v Owners-Strata Plan No 64970 [2011] NSWCA 181; BC201104963 at [8]–[24]. But, as the

decision in this case shows, even when the defect is known and time has started to run, the plaintiff

may be unaware of who is responsible for the defect. In general, even in economic loss cases, the High

Court has ‘rejected the proposition that … time does not run until the plaintiff discovers, or could

on reasonable inquiry have discovered, that damage has been sustained’: Commonwealth v Cornwell,

see 5.2.9, at [6], citing Hawkins v Clayton, see 16.2.19.

 

 5.2.9 In Wardley Australia Ltd v State of Western Australia (1992) 175 CLR 514, Mason CJ, Dawson,

Gaudron and McHugh JJ said:

Economic loss may take a variety of forms and, as Gaudron J noted in Hawkins v Clayton (1988)

164 CLR 539 at 600–1, the answer to the question when a cause of action for negligence causing

economic loss accrues may require consideration of the precise interest infringed by the negligent

act or omission. Th e kind of economic loss which is sustained and the time when it is fi rst sustained

depend upon the nature of the interest infringed and, perhaps, the nature of the interference to

which it is subjected: see Cane, Tort Law and Economic Interests, 1991, pp 16–17. With economic

loss, as with other forms of damage, there has to be some actual damage. … Prospective loss is not

enough (at 527).

 

 See also Commonwealth v Cornwell  (2007) 229 CLR 519 (employer gave plaintiff negligent advice

concerning his eligibility to join superannuation fund; majority held loss crystallised only on his

retirement; decision criticised by C W Pincus QC, (2007) 81 ALJ  735 at 738); Law Society v Sephton

& Co (a fi rm)  [2006] 2 AC 543 (HL) (no damage from negligent certifi cation of solicitor’s accounts

by auditor until claim made on Law Society).

 

Regards

Neil