Date: Tue, 8 May 2007 18:28

From: Andrew Tettenborn

Subject: Good news/bad news

Isn't there a relatively simple answer to this without having to value fast cars and fast women to give a set-off? This looks to me a classic case for a "purpose" and/or SAAMCO limitation on liability. If you ask your quack for a diagnosis, what is his duty? To tell you what how to treat your body or possibly mind: not, I'd have thought, to advise you what to do with your worldly wealth. Or, put another way, what is the purpose of the advice? Surely not wealth and/or estate (non)-planning.

Andrew

Dear Lionel,

I have been using this example with Medical Law students for years (admittedly, after a very similar case occurred in the UK - though only in the media - it never made the law reports).

As for the patient's claim for financial loss, consider Lord Devlin's observations in Hedley Byrne v Heller [1964] A.C. 465, 517:

This is why the distinction is now said to depend on whether financial loss is caused through physical injury or whether it is caused directly. The interposition of the physical injury is said to make a difference of principle. I can find neither logic nor common sense in this. If irrespective of contract, a doctor negligently advises a patient that he can safely pursue his occupation and he cannot and the patient's health suffers and he loses his livelihood, the patient has a remedy. But if the doctor negligently advises him that he cannot safely pursue his occupation when in fact he can and he loses his livelihood, there is said to be no remedy. Unless, of course, the patient was a private patient and the doctor accepted half a guinea for his trouble: then the patient can recover all. I am bound to say, my Lords, that I think this to be nonsense. It is not the sort of nonsense that can arise even in the best system of law out of the need to draw nice distinctions between borderline cases. It arises, if it is the law, simply out of a refusal to make sense. The line is not drawn on any intelligible principle. It just happens to be the line which those who have been driven from the extreme assertion that negligent statements in the absence of contractual or fiduciary duty give no cause of action have in the course of their retreat so far reached.

That certainly covers his lost earnings. Whether, strictly, it would cover the spending of his capital is another matter. On the other hand, we have a negligent statement, reliance, foreseeable financial loss caused by that reliance ... If the patient spent all his savings on fast cars (and/or faster women) then presumably he has to offset any benefits obtained?

--
Andrew Tettenborn MA LLB
Bracton Professor of Law
University of Exeter, England

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LAWYER, n. One skilled in circumvention of the law (Ambrose Bierce, 1906).

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