Date: Tue, 27 May 2008 20:09

From: Richard Wright

Subject: The refreshing SCC

As I read the cases, Wagon Mound No. 2 followed Bolton v. Stone in stating that a risk is "reasonably foreseeable" if it is "real" rather than being "fantastic" or "far-fetched", even if it is very unlikely; that it is not usually negligent to expose another to such a risk unless it is "substantial" or "significant"; but that if it is substantial or significant (and, I would add, not justified by direct or indirect benefits to those put at risk) it is negligent regardless of the cost of avoidance. Wagon Mound No. 2 added that, even if the risk is not significant, but nevertheless is real rather than fantastic (the sort of risk found to have existed in WM2), it may still be negligent to expose others to such a risk unless the defendant "had some valid reason for doing so, e.g., that it would involve considerable expense to eliminate the risk". No Hand formula or any similar "balancing" for breach of duty (much less for the existence of a duty) for significant risks, and, as Robert notes, not even a HF type of balancing for insignificant risks. And a very minimal test for foreseeability of risk, for duty or remoteness purposes; WM2 thus gutted WM1. For more discussion, see pages 1509-1517 at http://works.bepress.com/richard_wright/1.

RWW

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From: Robert Stevens   
Sent: Tuesday, May 27, 2008 11:55 AM
To: 'Lewis KLAR'; 'Jason Neyers'
Subject: RE: the refreshing SCC

Lewis Klar wrote:

In terms of breach, if one accepts the Wagon Mound No 2 reasoning, that in determining reasonable foreseeability for remoteness purposes, one considers probability of injury, costs of avoidance and severity (i.e. Learned Hand), then one eliminates the issue of remoteness and deals with everything under breach. Once one determines that the defendant was negligent, one also resolves the issue of remoteness, if this approach is followed.

I don't accept that.

Firstly one does not have to accept Learned Hand's test (I don't - I think it is nonsense) in order to accept, what is surely uncontroversial, that factors such as the severity of potential injury and the costs of avoidance, are relevant to the degree of likelihood with which the injury must have been reasonably foreseeable in order to establish a breach of duty with respect to the plaintiff. Secondly once breach of duty has been established, a separate issue of the scope of liability for losses must also frequently be answered. So, in the Wagon Mound (No 1) or Re Polemis there was no doubt at all that the defendant had breached its duty with respect to the plaintiff, the issue was one of the scope of liability for wrongdoing, not whether there was a wrong at all. You cannot roll the remoteness question into the breach question so that it disappears. We see exactly the same division where the wrong is breach of contract.

Put another way, we need to separate out the question (i) did the defendant commit a wrong with respect to the plaintiff; from (ii) are the losses consequent upon the wrong too remote?

Mustapha concerned (i) not (ii).

Put yet another way, remoteness is about the scope of liability for wrongdoing, not the scope of liability for conduct.

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