Home > Case Law Studies, Expert Witness > Negligence – Duty of care – Solicitor – Negligence in execution of will – Liability to intended beneficiaries: SEALE v PERRY (SUPREME COURT OF VICTORIA)

Negligence – Duty of care – Solicitor – Negligence in execution of will – Liability to intended beneficiaries: SEALE v PERRY (SUPREME COURT OF VICTORIA)

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VICTORIAN REPORTED JUDGMENTS
SEALE v PERRY
SUPREME COURT OF VICTORIA
FULL COURT
1981 VIC LEXIS 135; [1982] VR 193
9, 10, 13 and 14 April 1981, 11 September 1981, heard
11 September 1981, delivered
CATCHWORDS: [*1] Negligence – Duty of care – Solicitor – Negligence in execution of will – Liability to intended beneficiaries.

HEADNOTES:

In an action by intended beneficiaries under a will against a solicitor for negligence for failing to ensure that the will was executed in accordance with s7 of the Wills Act 1958.

Held: By Lush and Murphy, JJ that the solicitor owed no duty of care to the intended beneficiaries, and, in any event, no damage recognizable at law had been suffered by them.

By McGarvie, J, on principles contained in recent authorities the solicitor owed a duty of care to the intended beneficiaries but he was not liable to them in damages, but the Court was precluded by Robertson v Fleming (1861) 4 Macq 167, from so holding.

JUDGES: LUSH, MURPHY and MCGARVIE, JJ

JUDGMENTS: LUSH, J: The facts of this case are set out in the judgment of Murphy, J. The argument centred upon three main issues: (i) whether the solicitor defendant owed a duty of care to the beneficiary plaintiffs; (ii)  [*2] whether the plaintiffs had suffered damage; and (iii) the measure by which any damage suffered by the plaintiff was to be assessed.

The argument on the first question revealed a fundamental difference concerning the width of the famous proposition of Lord Atkin in Donoghue v Stevenson, [1932] AC 562. In that case, at p. 580, his Lordship referred to a “general conception of relations giving rise to a duty of care, of which the particular cases found in the books are but instances”, and proceeded to his definition of the neighbour relationship. The case itself involved a consideration of the liability of a manufacturer of a defective article to the ultimate consumer, and the final rule appropriate in the circumstances was formulated by Lord Atkin, at p. 599, in some detail, and is a definition of the conditions which must be satisfied before the injured person comes within the description “so closely and directly affected by my act that I ought reasonably to have them in contemplation”.

It will be of assistance to place together the original general statement appearing, at ([1932] AC) p. 580, and the final particular formulation appearing at p. 599. The former reads: “At present [*3] I content myself with pointing out that in English law there must be, and is, some general conception of relations giving rise to a duty of care, of which the particular cases found in the books are but instances. The liability for negligence, whether you style it such or treat it as in other systems as a species of ‘culpa’, is no doubt based upon a general public sentiment of moral wrongdoing for which the offender must pay. But acts or omissions which any moral code would censure cannot in a practical world be treated so as to demand relief. In this way rules of law arise which limit the range of complainants and the extent of their remedy. The rule that you are to love your neighbour becomes in law, you must not injure your neighbour; and the lawyer’s question, Who is my neighbour? receives a restricted reply. 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 by my act that I might reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions [*4] which are called in question.” The particular formulation is worded thus: “A manufacturer of products, which he sells in such a form as to show that he intends them to reach the ultimate consumer in the form in which they left him with no reasonable possibility of intermediate examination, and with the knowledge that the absence of reasonable care in the preparation or putting up of the products will result in an injury to the consumer’s life or property, owes a duty to the consumer to take that reasonable care.”

It will be seen that the sequence of thought in both these statements is to deal first with the element of relationship. In the general statement, foresight is treated as a factor defining the extent of the duty “to avoid acts or omissions” which would be likely to injure a person classed as a “neighbour”. There is a second element of foresight in the “contemplation” which is part of the test by which the “neighbour” is identified, but this identification is to be made before the duty to “take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour” arises. In the particular case it is treated as one of a number [*5] of facts which must be proved to establish a cause of action.

In neither the general nor the particular statements, therefore, does it appear that the mere foresight of possible injury to some person or persons is sufficient of itself to give rise to a duty to take care to avoid that injury. A relationship must be established before the law will attach liability to the defendant. The first task of the Court will be to decide whether a relationship capable of giving rise to liability exists, and in making this decision it will, as a necessary part of the common law tradition, consider previous decisions, but the speeches and the decision in Donoghue v Stevenson, supra, imparted a degree of flexibility to the law which makes possible changes and developments not previously contemplated. Whether a particular change or development is to be made may depend upon the Court’s view of reason or justice or policy–the word chosen is immaterial.

The same insistence on the identification of a relevant relationship appears in cases subsequent to Donoghue v Stevenson, of which I propose to refer to three for the reason that they were cited in a context to which I shall refer below in the  [*6] most recent House of Lords decision, Anns v Merton London Borough Council, [1978] AC 728; [1977] 2 All ER 492.

The first of these is Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., [196 AC 465; [1963] 2 All ER 575, a case in which the plaintiffs had asked their own bankers to make enquiries concerning a company of that company’s bankers, the defendants. The references given were favourable, were expressed to be “without responsibility” and were given negligently. When this case came to the House of Lords in 1964, the crucial question was whether there could be liability for the negligent writing or speaking of words, or whether liability for words was to be found only in the law of fraud and the law of defamation. The House of Lords held that the facts of the case would have given rise to liability in the defendant but for the qualification “without responsibility”. The speeches in the House of Lords show that their Lordships did not regard Donoghue v Stevenson as having provided a new test of liability. Lord Reid, at ([1964] AC) p. 482; ([1963] 2 All ER); p. 580, said: “The appellant’s first argument was based on Donoghue [*7] (or McAlister) v Stevenson. That is a very important decision, but I do not think that it has any direct bearing on this case. That decision may encourage us to develop existing lines of authority, but it cannot entitle us to disregard them. Apart altogether from authority I would think that the law must treat negligent words differently from negligent acts. The law ought so far as possible to reflect the standards of the reasonable man, and that is what Donoghue (or McAlister) v Stevenson sets out to do.” Lord Pearce, at ([1964] AC) p. 536, said in substance that Donoghue v Stevenson developed a rule for applying its general concept to one type of situation. It did not follow that the concept applied to all other types of situation which might fall within the words in which that concept was stated. Lord Devlin, at ([1964] AC) pp. 524-5; ([1963] 2 All ER) pp. 607-8, said: Now, it is not, in my opinion, a sensible application of what Lord Atkin was saying for a Judge to be invited on the facts of any particular case to say whether or not there was ‘proximity’ between the plaintiff and the defendant. That would be a misuse of a general conception and it is not the way in which English [*8] law develops. What Lord Atkin did was to use his general conception to open up a category of cases giving rise to a special duty. It was already clear that the law recognised the existence of such a duty in the category of articles that were dangerous in themselves. What Donoghue v Stevenson did may be described either as the widening of that old category or as the creation of a new and similar one. The general conception can be used to produce other categories in the same way. An existing category grows as instances of its application multiply until the time comes when the cell divides.

“…The real value of Donoghue v Stevenson to the argument in this case is that it shows how the law can be developed to solve particular problems. Is the relationship between the parties in this case such that it can be brought within a category giving rise to a special duty? As always in English law, the first step in such an inquiry is to see how far the authorities have gone, for new categories in the law do not spring into existence overnight.”

In Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., supra, the final definition of the liability which would have [*9] existed in the absence of the saving words imposes the requirement that there should be on the part of the defendant an express or implied acceptance of responsibility to the plaintiff or to a class of persons to which the plaintiff belonged: see Lord Devlin, at ([1964] AC) pp. 529-30, Lord Hodson, at p. 534, and Lord Pearce, at p. 539. It was said in argument that legal thought had moved on since the decision of that case in 1964, and no doubt this is true. Certainly what has happened since 1932 in the area covered by Donoghue v Stevenson and since 1964 in the area of careless representation and advice is that what was once novel has become familiar, has been explored with greater confidence, and has been found to have wider boundaries than might once have seemed likely. But in each case the question which has had to be answered is whether there was a duty, and not merely the question whether injury could have been foreseen: Pratt and Goldsmith v Goldsmith, [1975] VR 378, at pp. 386-7.

In the second case, Dorset Yacht Co. Ltd. v Home Office, [1970] AC 1004; [1970] 2 All ER 294 the House of Lords held that the Home Office was liable to property owners [*10] for damage done by boys who had left a Borstal camp where they were detained. Lord Pearson, at ([1970] AC) p. 1054, and Lord Diplock, at p. 1060, state in strong terms the limitations of Lord Atkin’s “aphorism” while in no way understating its significance in the law generally. At p. 1061, Lord Diplock said that if the aphorism were of general application it would by itself have disposed of the problems in Hedley Byrne and Co. Ltd. v Heller, except that of disclaimer. It may be noted that on the same page his Lordship pointed out that if the defendant were involved in two separate neighbour relations, conflicting duties might arise.

At ([1970] AC) p. 1027; ([1970] 2 All ER) p. 297 Lord Reid said of the aphorism: “It is not to be treated as if it were a statutory definition. It will require qualification in new circumstances. But I think that 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.”

This observation is significant in relation to a later statement by Lord Wilberforce, but Lord Reid was careful to point, in effect, to the fact that he was dealing with a case of physical damage [*11] to property and not with a case of economic loss or of a failure to assist.

The third case is Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373; [1971] 2 All ER 1003. In that case the council’s building inspector inspected and passed the excavations for the foundations of a house. In fact the house was built on the site of an old rubbish tip, a fact which should have been detected by the inspector if he had used due care. The house was completed and sold to a buyer, who sold it to the plaintiff. After the plaintiff took possession serious defects developed. The plaintiff was awarded damages against the council, based on the cost of repair. Sachs, LJ, at p. 400, quoted the dictum of Lord Pearson in the Dorset Yacht Case to which I have referred above, and at the following pages referred to different rules developed in different categories of cases within the general rule of Donoghue v Stevenson.

I have dealt with these three cases because of their intrinsic importance and because of their significance in the most recent House of Lords decision, Anns v Merton London Borough Council, [1978] AC 728; [1977] 2 All ER 492. [*12] In each of them a duty was held to exist, but only after a precise formulation of requirements appropriate to the case. There is in contrast the decision of the Privy Council in Mutual Life and Citizens’ Assurance Co. Ltd. v Evatt (1970) 122 CLR 628, where it was held that no duty of care in the giving of advice arose unless the giver carried on a business of giving skilled advice or possessed a special skill or competence in the field of the advice given: see (122 CLR) p. 641. At p. 642 still another caution was given against regarding any of the great historical cases as intended to lay down the metes and bounds of the law of negligence. Anns v Merton London Borough Council, supra, concerned the liability of a local government authority for the negligence of an inspector in the examination of the foundations and footings of a block of flats. The matter came before the House of Lords before trial, and was therefore argued on the pleadings. The decision of the House was that the Council could be liable to the plaintiffs, the owners of the flats at the time of the issue of the writ some years after the completion of the building, if it were shown that the [*13] officers had improperly exercised their discretion whether or not to make inspections, and had failed to exercise reasonable care to see that the by- laws were complied with. It may be thought that this was a limited duty of care, but the significant point is that it was held to be a duty owed to the plaintiffs.

In a speech in which Lord Diplock and Lord Simon of Glaisdale concurred, Lord Wilberforce said, at ([1978] AC) pp. 751-2; ([1977] 2 All ER) p. 499: “Through the trilogy of cases in this House, Donoghue v Stevenson, [1932] AC 562; Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., [1964] AC 465, and Dorset Yacht Co. Ltd. v Home Office, [1970] AC 1004, the position has now been reached that in order to establish that a duty of care arises in a particular situation, it is not necessary to bring the facts of that situation within those of previous situations 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 alleged wrongdoer and the person who has suffered damage there is a sufficient relationship of proximity or neighbourhood such that, in the reasonable contemplation of the [*14] former, carelessness on his part may be likely to cause damage to the latter, in which case a prima facie duty of care arises. Secondly, if the first question is answered affirmatively, it is necessary to consider whether there are any considerations which ought to negative, or to reduce or limit the scope of the duty or the class of person to whom it is owed or the damages to which a breach of it may give rise (see the Dorset Yacht Case, [1970] AC 1004, per Lord Reid, at p. 1027. Examples of this are Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., [1964] AC 465 whe the class of potential plaintiffs was reduced to those shown to have relied upon the correctness of statements made, and Weller and Co. v Foot and Mouth Disease Research Institute, [1966] 1 QB 569; and (I cite these merely as illustrations, without discussion) cases about ‘economic loss’ where, a duty having been held to exist, the nature of the recoverable damages was limited (see SCM (United Kingdom) Ltd. v W.J. Whittall and Son Ltd., [1971] 1 QB 337 and Spartan Steel and Alloys Ltd. v Martin and Co. (Contractors) Ltd., [1973] QB 27.”

This observation may [*15] be thought to echo the opinion of Lord Reid quoted above from the Dorset Yacht Case, at ([1970] AC) p. 1027. However, the paragraph in which that opinion appears contains references to categories of cases in which there exist various conditions of liability other than foreseeability of damage, and finishes, “I can see nothing to prevent our approaching the present case with Lord Atkin’s principles in mind”. In my opinion, in the light of its origin in Lord Reid’s statement and of the authorities which Lord Wilberforce cited, the passage which I have quoted cannot be read as meaning that the possibility of foreseeing damage by itself establishes “proximity” which in turn establishes a duty of care. Since I wish to say something later about the right of the plaintiff which must be correlative to the duty of the defendant, I point out that in both the Dorset Yacht Case and in Ann’s Case the plaintiff or plaintiffs owned property alleged to be damaged or adversely affected by the defendants’ conduct, and the questions were whether in the circumstances the defendants because of remoteness in the one case and the special nature of their statutory duties in the other were under any duty [*16] of care to avoid acts which might damage or impair that property.

In Caltex Oil Co. Ltd. v The Dredge Willemstad (1976) 136 CLR 529, the High Court dealt with a situation in which the plaintiff had suffered economic loss but no damage to property. The facts, briefly, were that the plaintiff by contract with a refinery company which owned a submarine pipeline obtained supplies of oil products from the refinery which were delivered to the plaintiff’s depot through the pipeline. The pipeline was fractured as a result of negligent navigation of the defendant dredge. Despite the absence of damage to any property owned by or in possession of the plaintiff, the High Court held that the defendant was liable to the plaintiff for damage measured by the cost of alternative methods of transporting the products to the depot. I shall refer further to this case below.

In the judgment under appeal, the learned Judge considered many if not most of the authorities, but in the end it is fair to say that he relied principally on the decision of the Vice-Chancellor Sir Robert Megarry in Ross v Caunters, [1980] 1 Ch 297; [1979] 3 All ER 580 [*17] a case in which the facts are not distinguishable from those of the present case, and that of the House of Lords in Anns v Merton London Borough Council, [1978] AC 728; [1977] 2 All ER 492 which in turn had provided the main basis for the decision of the Vice-Chancellor.

On the facts of the present case, it is clear that the defendant owed a duty of care to the testator by reason of his contract of retainer, and possibly owed a duty to the testator in tort. It is also beyond doubt that the defendant must have appreciated that his failure to carry out the testator’s instructions effectively would have the result of depriving the plaintiffs of the gift proposed to be made to them. The question in the end is whether the other circumstances of the case are such as to lead to the conclusion that, despite the factors just referred to, it should be held that the defendant owed no duty to the plaintiffs.

In my opinion this Court should hold that the defendant owed no duty to the plaintiffs for the following reasons:– (i) The testator owed no duty to the plaintiffs either to make the gift or to perfect the execution of his intention to make the gift. The evidence [*18] does not suggest any such duty contractual or otherwise, nor does it even suggest, if it be relevant, a moral duty. The question then arises whether it should be held that his solicitor acting on his behalf can be subject to a duty of which the testator was free.

All the cases in which an employer engages a workman or contractor to do work for him, and in which the workman or contractor has been held to be under a duty of care to others, “neighbours”, in performance of that work, are cases where the employer himself would have been under such a duty if negligently performing the work himself. The fact that the employer may have contracted out of liability, (e.g. Wilson v Darling Island Stevedoring and Lighterage Co. Ltd. (1956) 95 CLR 43 and Adler v Dickson, [1955] 1 QB 158) is not relevant–he has contracted out of his liability for breach of an acknowledged duty of care. (ii) The content of the defendant’s duties was entirely within the control of the testator. Change in instructions, or waiver of a breach of instructions must have the effect of destroying any duty to the plaintiffs to act in accordance with the original instructions.  [*19] It would not have availed the defendant boatswain in Adler v Dickson, supra, to say that a ship’s officer, seeing the way in which the gangway had been rigged, had said “That will do”. But it must, I think, be accepted here that if the defendant had negligently delayed drawing the will, and on discovering this the testator had said “No matter, I shall make a different one”, or even if he had said “Take no further action”, the plaintiffs could not have succeeded in any proceedings. These considerations support the first proposition by indicating that the defendant was under no separate duty to the plaintiff distinct from any duty incumbent on the testator, and if the latter owed none neither did the defendant. (iii) There are serious difficulties involved in the concept that a solicitor may owe a duty of care to any person other than his client in the discharge of his client’s instructions. The result might well be the existence of conflicting duties, a possibility contemplated by Lord Diplock in the Dorset Yacht Case at ([1970] AC) p. 1061. (iv) The only interest which the plaintiffs had in the gift at the time of the solicitor’s negligent conduct was a  [*20] spes successionis, and if this expression be thought to imply a subjective state of mind, there was no evidence that they knew of the intended gift, though in my opinion this is irrelevant. There was, however, no right or interest capable of protection at law or in equity or capable of enforcement by any remedy. The case therefore approximates to one in which the defendants are saying not so much, “you failed in your duty to use care to protect our interests” as “you failed in a duty to assist us to protect our interests”. If this be accepted, as I think it should be, the case becomes one to which the observation of Lord Reid in the Dorset Yacht Co. Ltd. v Home Office, [1970] AC 1004, at p. 1027; [1970] 2 All ER 294, at pp. 297-8, may be applied: “And when a person has done nothing to put himself in any relationship with another person in distress or with his property mere accidental propinquity does not require him to go to that person’s assistance.” (v) Nothing in the circumstances points to any assumption by the defendant of a duty to the plaintiffs. The case in my opinion falls between cases of negligent conduct and cases of negligent words, though I  [*21] think it is artificial to say, as was argued, that the solicitor represented to his client that the will was valid. In any case, this representation was not made to the plaintiffs. Nevertheless, I consider that the question of assumption of responsibility is relevant here. The auditor or the banker may fairly be said to assume responsibility to those to whom his reports are, in his contemplation, going. The solicitor taking instructions for a will is concerned only with his client, and exercises no choice, and indeed it is irrelevant to him, who the beneficiaries may be. In no sense comparable with the cases of the banker and the auditor does he accept any responsibility to any person other than his client. The facts of the present case may be contrasted with those of Whittingham v Crease and Co., [1978] 5 WWR 45, as set out in Ross v Caunters, [1980] Ch 297 at p. 312; [1979] 3 All ER 580. In that case the solicitor urged the witness to sign, against her doubts, the debate taking place in the presence of the witness’s husband, the plaintiff. In these circumstances I think that a responsibility to the plaintiff was assumed by the [*22] solicitor. So also in a case referred to by McGarvie, J, Everett v Griffiths, [1920] 3 KB 163 there was a clear acceptance by the doctor of responsibility to the patient, as Atkin, LJ indicated in a passage cited by McGarvie, J Indeed, it now seems difficult to understand why the doctor’s contract with the parish guardians was even relevant to his liability to the patient.

There is another approach which leads to the same conclusion. In the cases which I have cited, the speeches and judgments have been expressed in terms which concentrate on examining the question whether a duty exists. A duty, however, cannot exist by itself. To the duty seen as imposed on the defendant, there must be a correlative right in the plaintiff: for either to exist, both must be capable of being identified.

It is possible that this proposition is at the root of the reluctance of the common law, evident for a long time, to recognize purely economic loss as a form of damage recoverable in an action for negligence. If person or property were damaged, it was not difficult to identify the plaintiff’s right as a right to have care taken not to cause that damage. If the plaintiff [*23] suffered an economic loss, such as the loss of the profits of a business, it was less easy to identify anything in the nature of a right to be protected by an action for negligence.

The decision in Hedley Byrne and Co. Ltd. and Partners Ltd., [1964] AC 465; [196 2 All ER 492 that damages could be recovered for the consequences of negligent misrepresentation meant that damages for a purely economic loss would be awarded in cases of that kind. That, however, did not overcome the fundamental difficulty in allowing actions for such loss, because in the misrepresentation cases, the plaintiff on the faith of the representation decides to take or not to take some step, and the common law is familiar with the award of consequent damage in such a situation in fraud cases.

I venture to think that it is really the problem of identifying the right which the plaintiff is entitled to have protected which underlies the difficulties of allowing actions to be brought in cases were the plaintiff has suffered and suffered only economic loss. These difficulties were considered in the judgments of the Court of Appeal in Spartan Steel and Alloys Ltd. v Martin and Co. (Contractors)  [*24] Ltd., [1973] QB 27; [1972] 3 All ER 557 and of the High Court in Caltex Oil (Australia) Pty. Ltd. v The Dredge Willemstad (1976) 136 CLR 529.

In each of these cases, damages of a limited nature were awarded for the consequences of negligent damage to a facility which the plaintiff was using in a commercial operation. In neither case was the plaintiff the owner of or in possession of the equipment actually damaged. In the Spartan Steel Case, the plaintiff constantly used electricity supplied through the damaged cable, but had no right to the continuance of supply. In the Caltex Case the plaintiff had a right by contract with a third party to the delivery of oil products through the damaged pipeline. The decisions of the two Courts give protection to the relevant user, so that it is treated as the foundation of a right. Nevertheless, the protection afforded was limited. In the Spartan Steel Case, damages were limited to losses connected with work in progress at the time of the interruption, and were refused for the loss of profits of subsequent operations which might have been expected to follow in the ordinary course of events.  [*25] In the Caltex Case, the damages sought were limited to the additional cost of moving the products by means other than the pipeline, but the tenor of the judgments suggests to me that had, for instance, there been a loss of profit because not all the available products could have been moved to points of sale by alternative means, damages would not have been given for that loss. The decision in Morrison Steamship Co. v Greystoke Castle (Cargo Owners), [1947] AC 265; [1946] 2 All ER 265 is capable of similar explanation. The cargo of the plaintiffs was in process of carriage when the negligence of the defendant in damaging the ship in which the cargo was being carried brought about an increase in the ultimate cost of the carriage to the plaintiffs.

In the present case, there is nothing in the position of the plaintiffs on which a right can be founded. They had no form of right at law, by contract or otherwise, to the benefaction, and there is nothing which can be treated as analogous to the enjoyment or continuous enjoyment of a service which is to be seen in the last three cases mentioned. Indeed, if there is an analogy, it is between the plaintiffs’  [*26] expectation in this case and the plaintiff’s expectation of future profits which were refused protection in the Spartan Steel Case in a manner apparently approved by the High Court in the Caltex Case.

In Caltex Oil (Australia) Pty. Ltd. v The Dredge Willemstad (1976) 136 CLR 529, stress was laid on the fact that the defendant should have foreseen that damage of the particular kind which in fact occurred might be caused to a particular, identified person or company. In a sense, a parallel proposition can be put on the facts of this case. Passages referring to the foreseeability of loss to a specific person may be found in the judgments of Gibbs, J, at (136 CLR) p. 555, Stephen, J, at p. 577, and Mason, J, at p. 599. Although this is so, there are other parts of the formulations the requirements of which are not met by the present facts. Thus, Gibbs, J, who, at (136 CLR) p. 544, had posed the question to be decided in the case in terms which appear to make some physical damage to the property of some person (i.e. the invasion of some right) an essential of liability to the plaintiff, stated, at p. 555, that as a general rule damages to the plaintiff’s person [*27] or property was an essential part of a cause of action. He continued: “The fact that the loss was forseeable is not enough to make it recoverable. However, there are exceptional cases in which the defendant has knowledge or means of knowledge that the plaintiff individually, and not merely as a member of an unascertained class, will be likely to suffer economic loss as a consequence of his negligence, and owes the plaintiff a duty to take care not to cause him such damage by his negligent act.”

The last clause in this sentence in effect emphasizes the proposition that foreseeability of damage will not be enough to create a duty and a correlative right–these must be found in some aspects of the facts other than foreseeability, or in those aspects combined with foreseeability. So also Stephen, J, at (136 CLR) p. 577 stressed that what the plaintiff should have foreseen was that damage to specific property might cause loss to more than one person, and accordingly considered it significant that there had been negligent damage to the property of a third party in breach of a duty of care owed to that party. Mason, J’s formulation at p. 593, in the sentence beginning “Moreover, they [*28] should have foreseen…”, of the foreseeable consequences which gave rise to liability includes foresight that some rights of property would be infringed in a manner which would cause loss.

Thus, all three of the judgments cited refer either to the existence of a duty to the plaintiff arising out of circumstances other than the foreseeability of loss, or to the existence and breach of a duty of care to some person, damage to whose property has occasioned the loss to the plaintiff.

For my part, I do not regard the emphasis on property damage and personal injury in decided cases, continued as it is in the judgments of Gibbs, Stephen and Jacobs, JJ, as either arbitrary or restrictive. I think a consideration of the right which must be correlative to any suggested duty reveals the reason for this emphasis. In broad terms, the common law of tort afforded protection by personal actions to property rights and to integrity of the person. The action on the case facilitated the grant of this protection and very largely extended its scope. The introduction of liability for negligent acts widened the relief which had been available in trespass, since the latter relief was available only [*29] in cases where land, goods or person had been directly affected by the acts of the defendant: Holmes v Mather (1875) LR 10 Ex 261. But at all times, and the law of defamation which also developed as an action on the case is an illustration, it was essential that some right of the plaintiff should be infringed by the defendant. While damage was of the essence of an action on the case, it would not by itself found the action. Stephen, J refers to this subject at (136 CLR) p. 569. There is perhaps some difference in emphasis between his historical reference and mine. I respectfully agree with him that a denial to the risk bearer of the protection given to the chattel owner or person in possession may be unjust, but I suggest that the injustice should be corrected by extending the concept of the protected interest, and not by saying that no such interest need be shown if damage is suffered. In fact it appears to me that this is exactly what has been done in Morrison Steamship Co. v Greystoke Castle (Cargo Owners), [1947] AC 265; [1946] 2 All ER 265; Spartan Steel and Alloys Ltd. v Martin and Co. (Contractors) Ltd., [1973] QB 27; [1972]  [*30] 3 All ER 557 and the Caltex Case. In another case cited as one in which the plaintiff recovered “economic loss”, Ministry of Housing and Local Government v Sharp, [1970] 2 QB 223; [1970] 1 All ER 1009 the negligent act complained of had resulted in the loss to the plaintiff of a proprietary right. In the negligent misrepresentation cases it may perhaps be said that a right arises in the plaintiff out of the facts of reliance by the plaintiff on the misrepresentation and an acceptance of responsibility by the defendant for the advice contained in the misrepresentation, a right which arises out of a relationship of “proximity”, a para-contractual right.

No extension of the concept of right or protected interest which has yet been made will suffice to sustain the present plaintiffs’ case. It is not assisted by cases on the assessment of damages for the loss by breach of contract of a chance of gain, because in those cases the contract gave the plaintiff a right to the chance. Nor, in my opinion, do either “policy”, “reason” or “the requirements of justice” make it desirable that such an extension should [*31] be made. Accordingly, my opinion on the first issue argued is that the defendant in the present action owed the plaintiffs no duty of care.

These views are against the weighty authority of Sir Robert Megarry V-C’s decision in Ross v Caunters, [1980] 1 Ch 297; [1979] 3 All ER 580. In his judgment in that case, the Vice-Chancellor began by considering the decision of the House of Lords in Robertson v Fleming (1861) 4 Macq 167, in which it was said that the negligent conduct by a solicitor of his client’s business does not expose the solicitor to an action by a third person who has lost a contemplated benefit. I do not share the Vice-Chancellor’s view that these statements were obiter. The Vice-Chancellor’s reason for not applying them, however, was not that they were obiter but that they had been superseded by the decision in Donoghue v Stevenson, [1932] AC 562 and the cases which came after it.

The proposition that a solicitor is not liable for professional negligence to a person other than his client does not rest on Robertson v Fleming, supra, alone. Moss v Solomon  [*32] (1858) 1 F and F 342; 175 ER 756, a nisi prius decision of Willes, J, and Rae v Meek (1884) 14 AC 558, a further decision of the House of Lords, were to the same effect. In Rae v Meek the pursuers were in a stronger position than the present plaintiffs, because they were, to the knowledge of the defender law agent, beneficiaries contingently interested in a fund which the pursuers alleged was lost when the trustees acted on negligent advice of the law agent.

The Vice-Chancellor gave reasons for preferring the view that a solicitor is liable to his client in tort as well as in contract (Midland Bank Trust Co. v Hett, Stubbs and Kemp, [1979] Ch 384) to the traditional view that the liability was in contract only (Groom v Crocker, [1939] 1 KB 194). I do not propose to follow the Vice-Chancellor into this issue. I draw attention to the fact that the cases cited by Lord Denning MR in his judgment in Esso Petroleum Co. Ltd. v Mardon, [1976] QB 801, at pp. 819-20; [1976] 2 All ER 5 a judgment which the Vice-Chancellor treated as decisive, refer to a duty imposed by law on one of the parties to a contract,  [*33] breach of which duty may be a tort, but are far from saying that a duty so created enures for the benefit of persons not parties to the contract or other event which was the occasion of the duty. In Mardon’s Case the tort found by Lord Denning did not lie in breach of the expert’s duty to give skilled and careful advice to Esso, but in the fact that Esso and their expert servant had negligently made representations to the plaintiff.

In this jurisdiction Gillard, J’s decision in Belous v Willets, [1970] VR 45 stands against that of Oliver, J in the Midland Bank Trust Case, supra.

As I have indicated, the Vice-Chancellor relied upon the dictum of Lord Wilberforce in Anns v Merton London Borough Council, [1978] AC 728; [1977] 2 All ER 492, which I have quoted. I have already made my comments on the interpretation of that passage.

American cases quoted by the Vice-Chancellor are directly in point, but the American courts have not spoken with one voice on the subject. A reference to 45 American Law Reports, 3rd series, 1181 and 1187-1200 shows a divergence of result, and, where the plaintiff has succeeded, a division of reasons between allowing a third [*34] party to benefit from the contract of retainer and allowing the third party to sue for breach of a duty owed to him. It may be mentioned that Biakanja v Irving (1958) 320 P 2d 16 emphasizes the specific identification of the plaintiff as a person likely to be injured as a relevant factor, as does Caltex Oil (Australia) Pty. Ltd. v The Dredge Willemstad (1976) 136 CLR 529. On the issue of the recovery in an action for negligence of damages for economic loss not accompanied by damage to person or property or injury to an identifiable right, I have already expressed my views. Megarry, V-C, at ([1980] Ch) p. 321, dismissed the argument that the plaintiff had suffered no financial loss, but the difficulty of the matter is illustrated by his own example of the “gift in transit”. It may be that in ordinary English usage the donee would be said to suffer a loss if the gift were destroyed or stolen, but unless the property had passed to him the donee would not be entitled to sue the carrier.

Since I am of the opinion that the defendant in the action should succeed, it is not strictly necessary to consider the question of the measure [*35] of damages. I confine myself to saying that in my opinion damages are to be measured by the value of the estate in land considered to have been lost by the plaintiffs. If there is no market for such estates, then the value must be determined by discounting the value of the freehold with vacant possession to allow for the deferment of possession. There is in my opinion no room in this exercise for a consideration of the taxation liabilities of individual plaintiffs. The estate itself has a value which is constant irrespective of the identity of the owner. Without attempting to discuss the authorities, I am of the opinion that since the rise in value of the land was not shown to have been produced by any factor other than inflation, it is the value at the date of trial which should be used as the basis for assessing the value of the estate given.

In my opinion, accordingly, the appeal should be allowed, the judgment appealed from set aside, and in lieu thereof there should in the action be judgment for the defendant. The plaintiffs will pay the costs, both here and below.

MURPHY, J: This was an appeal against the judgment of Anderson, J delivered on 19 May 1980 whereby judgment [*36] was entered for the first-named respondent in the sum of $ 6425 and for the second-named respondent in the sum of $ 9000.

At the hearing before the learned trial Judge, the plaintiffs (respondents) claimed damages from the defendant (appellant) for his alleged negligence associated with the execution of the will of Joseph William Byrne (the deceased).

In August 1973, the deceased had consulted the appellant, who practised as a solicitor, and retained him to prepare a will for him according to instructions given. The will was drawn by the appellant in accordance with the instructions that were given to him, but unfortunately the will was not executed in conformity with the Wills Act 1958.

The witnesses to the deceased’s signature on the will, one of whom was the appellant himself, did not subscribe their signatures in the presence of the deceased.

The deceased died on 13 September 1973. Probate of the invalid will was refused and probate of an earlier will made by the deceased in 1954 was granted on 22 July 1974. Under that earlier will, the subject property, situate at Manningham Road, Bulleen was devised to the widow of the deceased, and neither of the plaintiffs obtained [*37] any benefit. The instructions which had been given to the appellant by the deceased in August 1973 were intended to have the effect of devising to the plaintiffs and to their mother the said property as tenants in common in equal shares, but subject to the right of the widow of the deceased to live in the said property for as long as she might wish. The value of the subject property at the date of the death of the deceased was $ 26,500. By the date of the hearing of this action, the value of the said property was $ 46,000. The deceased was survived by his widow, who was born on 16 October 1910. She was in good health. At the hearing, there was evidence, which the learned trial Judge accepted, that her life expectancy at that time was 14.45 years.

By their statement of claim, the plaintiffs alleged that the appellant owed to them a duty of care and that their failure to take under the invalid will resulted from the negligence of the appellant. This negligence was particularized as follows: “Failing to ensure that the signatures of the witnesses to the will were subscribed in the presence of the deceased”. The plaintiffs alleged that they had suffered loss and damage, and particularized [*38] that loss and damage as follows: “Each plaintiff has suffered a loss of a one- third share in the property referred to in paragraph four hereof, which , as of the date of death of the deceased, was valued in all at $ 26,500”.

Each plaintiff accordingly claimed the value of his/her one-third share, which was stated in the prayer for relief, to be $ 8833.33.

The learned trial Judge held that the appellant owed a duty of care to the respondents and that he had been in breach of that duty of care and was liable in negligence to pay damages.

I shall leave till later in this judgment any discussion of the way in which his Honour considered the question of damages.

The notice of appeal dated 28 May 1980 sets out some nine grounds, to which I do not think it is necessary to refer in detail. In essence, the appellant submitted that the learned trial Judge was wrong in holding as he did that the appellant owed a duty of care to the respondents to use proper skill and care to have the will properly executed, and that the appellant was liable to them in tort for negligence in failing to do so. The grounds of appeal also went to the issue as to the assessment of damages.

Looking [*39] to see what was the ratio of the decision of the learned trial Judge, it appears that he was prepared to follow a decision given quite recently by Megarry, V-C in Ross v Caunters, [1980] 1 Ch 297; [1979] 3 All ER 580, which decision had been followed by Burt, CJ in Watts v The Public Trustee of Western Australia, [1980] WAR 97.

The factual situation in the present case was for practical purposes on all fours with the factual situation existing in each of those two cases, and the learned trial Judge was persuaded by the reasoning in Ross v Caunters, supra, to adopt the ratio of that case.

In Ross v Caunters, Megarry, V-C held (my underlining): “In a case such as the present, there is merely a duty owed to him” (the beneficiary) “as well as the client, to use proper care in carrying out the client’s instructions for conferring the benefit on the third party…the duty that I hold to exist in the present case, far from diluting the solicitor’s duty to his client, marches with it, and, if anything, strengthens it.”

A little earlier, at ([1980] 1 Ch 297) p. 322; ([1979]  [*40] 3 All ER) p. 599 his Lordship had said (my underlining): “In broad terms, a solicitor’s duty to his client is to do for him all that he properly can, with, of course, proper care and attention. Subject to giving due weight to the adverb ‘properly’, that duty is a paramount duty. The solicitor owes no such duty to those who are not his clients. He is no guardian of their interests. What he does for his client may be hostile and injurious to their interests; and sometimes the greater the injuries the better will he have served his client. The duty owed by a solicitor to a third party is entirely different; there is no trace of a wide and general duty to do all that properly can be done for him.” These statements of principle lie at the base of his Lordship’s judgment. Nonetheless, I do not know that it is necessary at this point to examine the meaning of and the implications of the acceptance of the term “a paramount duty” as used by his Lordship in the above passage. Nor do I intend to digress to examine how difficult it might be to support the view that a duty owed to a third party “strengthens” the duty owed by a solicitor to his client.

However, it does appear that his Lordship,  [*41] when defining the duty owed by a solicitor to the beneficiary, considered that that duty was coterminous, (if one can use that word), with the duty owed by the solicitor to his client. It “marches with it” and, presumably, I add, keeps in step. I am not clear whether this circumstances was considered by his Lordship to be purely coincidental, arising out of the facts of the particular case he was deciding, or whether the duty, which he found was owed by a solicitor to third party beneficiaries would, in all cases, be expected to vary and, as his Lordship put it, to “march” with any variations that there might be in the contractual duty which the solicitor owed to the client. I rather imagine that the latter was what his Lordship had in mind.

I find it rather odd as a concept that this duty owed by a solicitor to a third party arises only in circumstances where the client intends or desires to confer a “benefit” on a third party, and that if the intendment (or perhaps it is the effect) of the client’s instructions was not to confer a benefit but even to injure the interests of a third party, then no duty to take care arises.

In many cases the solicitor could imagine, at the time [*42] when his work was to be performed, that it involved the conferring of some “benefit”, or even perhaps that it may have some injurious effect on somebody, and therefore he might, on proper investigation, be in a position to make a decision whether or not a “benefit” was involved and whether he owed a duty of care to some third person or persons.

The precise meaning which should be attached to the word “benefit”, as used trusts, assignments, settlements, wills or the like would on similar reasoning owe duties of care to different persons. If the solicitor attempted to protect himself against this responsibility by a special contract with his client in which he disclaimed any responsibility (just as the Bank did in the case of Hedley Byrne and Co. Ltd. v Heller and Partners, [1964] AC 465; [1963] 2 All ER 575), interesting questions would arise whether this would protect the solicitor in an action brought against him by the oblivious third party. And, if so, why? If not, it is difficult to see why a solicitor owing a Hedley Byrne duty of care to third parties can protect himself if there is no contract, but is unable to protect himself apropos third parties,  [*43] if there is in fact a contract.

The principle involved appears to me to be an elusive one.

It may be said that the duty, which his Lordship found to exist in Ross v Caunters, [1980] 1 Ch 297; [1979] 3 All ER 580 must really spring from the terms of the contract itself. And if it does spring from the contract, is the supposed duty really the assertion of a jus quaesitum tertio? This would, as I appreciate the law, be in direct conflict with decisions both of the House of Lords and of the Privy Council, and would also run counter to expressions of opinion contained in decisions of the High Court of Australia: see Coulls v Bagot’s Executor and Trustee Co. Ltd., [1967] ALR 385; 40 ALJR 471; Beswick v Beswick, [1968] AC 58 (H.L.); Dunlop Pneumatic Tyre Co. Ltd. v Selfridge and Co. Ltd., [1915] AC 847; Midland Silicones Ltd. v Scruttons Ltd., [1962] AC 446; New Zealand Shipping Co. Ltd. v A M Satterthwaite and Co. Ltd., [1975] AC 154 (PC).

It is difficult to avoid the conclusion that the duty said in Ross v Caunters, supra, to be owed by a solicitor to a third party, in circumstances [*44] such as we are considering here, must arise in some way out of or as a consequence of the contractual relationship and not of the actual work which the solicitor has undertaken on behalf of his client.

In the present case the third party was not known to the solicitor. Nor did he know the solicitor, and he did not rely upon the solicitor in any way. He did absolutely nothing. He did not in reliance on the maker drink the deleterious ginger beer or wear the irritating underpants and suffer personal injury as the consumers respectively did in Donoghue v Stevenson, [1932] AC 562 and Grant v Australian Knitting Mills, [1936] AC 85. He did not act to his financial detriment, relying upon the professional skill of the bankers or upon any advice given to him by the bankers as (hypothetically) did the advertising agents in Hedley Byrne and Co. v Heller and Partners, [1964] AC 465; [1963] 2 All ER 575 and the investor in Mutual Life and Citizens Assurance Co. v Evatt, [1971] AC 793; (1968) 122 CLR 556 (HC); (1970) 122 CLR 628 (PC). He did not in reliance on anyone lay out money in the purchase of a flat or  [*45] home (which sank), as did the plaintiff in Anns v The Merton London Borough Council, [1978] AC 728; [1977] 2 All ER 492. His property was not damaged as a consequence of any act or omission of public officials as was the plaintiff’s yacht in Dorset Yacht Co. v Home Office, [1970] AC 1004. He lost nothing of his own, nor was any property of his damaged, destroyed or affected in any way; his health was not touched.

His Lordship, in Ross v Caunters, was nonetheless prepared to find that as a consequence of the recent developments in the understanding of the law of negligence as expounded in the several decisions of the House of Lords and Privy Council referred to, the fact that the solicitor should have foreseen that the named third party beneficiary would not receive an inheritance if he did not exercise due care and skill in and about the execution of the will containing the devises intended by the testator, placed him in a “special relationship” with the beneficiary which gave rise to a duty owed to that beneficiary to take care. This involved, according to his Lordship, “either an extension of the Hedley Byrne principle [1964] AC 465 or, more probably,  [*46] a direct application of the principle of Donoghue v Stevenson, [1932] AC 562″; Ross v Caunters, [1980] 1 Ch 297, at p. 322; [1979] 3 All ER 580, at p. 599. It had been submitted by counsel to his Lordship that “if a solicitor was not liable in tort even to his own client, it would be remarkable to hold him liable in tort to a third party” ([1980] 1 Ch 297, at pp. 306-8), and his Lordship seems to have been attracted by this submission. I myself would not find that there was anything “remarkable” in such a proposition if, in the performance of the contract he had made with his client, the solicitor breached in its performance some tortious duty of care that he owed to a third party. As Lord Salmon said in Arenson v Arenson, [1977] AC 405, at p. 438, when referring to Sutcliffe v Thackrah, [1974] AC 727, “The architect owed a duty to his client, the building owner, arising out of the contract between them, to use reasonable care in issuing his certificates. He also, however, owed a similar duty of care to the contractor, arising out of their proximity: see Hedley Byrne and Co. Ltd. v Heller and Partners [*47] Ltd., [1964] AC 465.”

“The tort liability is independent of any question of contract”: Grant v Australian Knitting Mills Ltd., [1936] AC 85, at p. 106.

What I would think it surprising to find is that, although a testator himself owed no duty of care to persons he proposed to benefit (because they have no rights apropos him), and need not take care to see that his will is properly executed (whether homemade or professionally drawn), yet if the testator employed a solicitor to do the very same thing on his behalf, then that solicitor does owe a duty of care to persons whom his client proposes to benefit.

Where an agent, independent contractor, professional man or employee has in the past been held liable in negligence to a third party for the negligent performance of a contractual act which he was engaged to perform on behalf of his principal, it has always been in circumstances where the principal himself, if he had performed the act in question, would also have been liable to the third party who was injured. In a way, he is the principal’s agent.

Accordingly, it seems that the proposition that a solicitor owes a duty of care to third parties in the circumstances with  [*48] which we are here concerned is a novel one.

In Donoghue v Stevenson, [1932] AC 562 Lord Atkin took as the basis for the propositions that he was putting before the House, Luke’s parable of the Good Samaritan. The acceptance of the proposition that a solicitor owes a duty to a third party who is brought to his notice fortuitously because of the contents of the contract he makes with his client, seems to involve that the priest and the Levite who passed by the man lying in the gutter breached a duty of care that they owed him which, as I understand the law, would be incorrect. Moreover, it also involves that, if the Good Samaritan had gone past, but later engaged for reward a charioteer plying his trade, instructing him to carry the man in the gutter to his (the Good Samaritan’s) abode and if the charioteer breached his contract with the Good Samaritan by failing to go near the man in the gutter, the man in the gutter could sue the charioteer for breach of a duty that the charioteer owed to him to take care in the performance of his contract. He would “be so closely and directly affected by his” (the charioteer’s) “acts or omissions that he can reasonably foresee that the third party [*49] is likely to be injured by those acts or omissions”: see Ross v Caunters, [1980] 1 Ch 297, at p. 323; [1979] 3 All ER 580, at p. 599. This appears to me to involve a legal heresy. I suspect it is the introduction, through the back door, of a jus quaesitum tertio, and as Lord Haldane said, “Our law knows nothing of a jus quaesitum tertio arising by way of contract”: Pneumatic Tyre Co. Ltd. v Selfridge, [1915] AC 847, at p. 853. In Rookes v Barnard, [1964] AC 1129, at p. 1187 Lord Evershed stated: “Only parties to a contract may sue for breaches of that contract, notwithstanding that some third party may be damnified by the breach.”

In Beswick v Beswick, [1968] AC 58 the House of Lords applied Tweddle v Atkinson (1861) 1 B and S 393 and referred to “the fundamental rule laid down” in that case. Lord Reid specifically referred to “Lord Denning’s view, expressed in this case not for the first time,” that a third person who is to benefit from a contract to which he is not a party can sue to enforce it. His Lordship said, “But the view more commonly held in recent times has been that such a contract confers no right on” the third [*50] party: [1968] AC 58, at p. 72. In Beswick v Beswick, supra, the House unanimously decided that the widow of a deceased man who had made a contract with his nephew, whereby the nephew was obliged to pay the widow so much each week for life, could not sue personally to enforce the contract.

Again, in New Zealand Shipping Co. Ltd. v AM Satterthwaite and Co. Ltd., [1975] AC 154, at p. 166 the Privy Council stated: “The starting point in discussion of this question is provided by the House of Lords’ decision in Midland Silicones Ltd. v Scruttons Ltd., [1962] AC 446. There is no need to question or even to qualify that case insofar as it affirms the general proposition that a contract between two parties cannot be sued on by a third person even though the contract is expressed to be for his benefit. Nor is it necessary to disagree with anything which was said to the same effect in the Australian case of Wilson v Darling Island Stevedoring and Lighterage Co. Ltd. (1956) 95 CLR 43.” See also Coulls v Bagot’s Executor and Trustee Co. Ltd., [1967] ALR 385; 40 ALJR 471.

Although the third party beneficiary clearly cannot sue for damages [*51] for breach of contract, because he has no rights springing from the contract, Megarry, V-C suggests that he can nonetheless sue for damages in tort for its negligent performance.

He has a right, it is said, springing from the relationship between him and the negligent contracting party which is brought about or created by the contract. The duty-relationship to the third party is said to arise because the negligent contracting party knew that the other party to the contract intended to benefit the third party and, accordingly, he (the solicitor) owed the third party a duty to exercise reasonable care in the performance of the contract. The cases mentioned above reaffirm the fundamental rule of the common law that the third party beneficiary cannot sue on the contract for damages or specific performance following a deliberate breach of or failure to perform a contract. It follows that the third party beneficiary cannot sue on the contract for damages or specific performance following a negligent breach of or failure to perform a contract.

The American cases to which his Lordship refers in Ross. v Caunters, supra, have to be understood in their American [*52] context. As Windeyer, J. said in Coulls v Bagot’s Executor and Trustee Co. Ltd. (1967) 40 ALJR 471, at p. 484, when referring to the American approach, “There, in most but not all jurisdictions, third persons (both donee-beneficiaries and creditor- beneficiaries as they are called) are now able to sue directly upon contracts made by others for their benefit. This rule, now accepted by the Restatement of the Law of Contracts, was arrived at only after much conflict among courts and commentators.”

But the fundamental common law principle still applies here. In my opinion, it should only be altered, if necessary, by statute.

It would appear that the submission that a duty is owed by a solicitor to a third party beneficiary in tort (and correspondingly that a right is enjoyed by a third party beneficiary in tort), a duty and right respectively arising solely because of the relationship created by or the work to be done under the contract, either runs counter to the fundamental rule or, surprisingly, avoids it. In my view it runs counter to it, for it asserts that rights may flow to a third party as a direct consequence of the contents of the contract,  [*53] albeit a right in tort, and no rights are conferred on a third party by reason solely of the contract. They may arise out of work done pursuant to a contractual obligation, but if this is so, it is because of considerations altogether removed from the law of contract.

It is because the work done, of its nature, involves a risk to the health or property of a reliant third party, if the work to be relied on by the third party is not done with reasonable care.

At the outset of his learned judgment, Sir Robert Megarry states: “The solicitors are liable, of course, to the testator or to his estate for a breach of the duty that they owed to him, though as he has suffered no financial loss it seems that his estate could recover no more than nominal damages. Yet, it is said that however careless the solicitors were, they owed no duty to the beneficiary, and so they cannot be liable to her. “If this is right, the result is striking”: Ross v Caunters, [1980] Ch, at pp. 302-3; [1979] 3 All ER 580, at pp. 582-3.

My intuitive reaction to the above proposition differs from that of his Lordship.

Much later in his judgment, his Lordship said, at ([1980] Ch) p.  [*54] 321; ([1979] 3 All ER) p. 598: “To me, a failure to receive an assured benefit is a loss. If a gift in transit to a donee is destroyed or stolen, I think both English usage and common sense would accept that the donee had suffered a loss, even if the property had not passed.”

If he did suffer a loss, it would be, in my view, damnum sine injuria.

With the greatest respect, I take leave to doubt whether legal common sense does demand the acceptance of the proposition that a donee loses a thing of which he never had possession and to which he never had right or title: see Margarine Union GmbH v Cambay Prince Steamship Co., [1969] 1 QB 219. A loss demands that there should be a change of conditions resulting in detriment, and is usually associated with a deprivation of possession or of title. Looking at the first of his main conclusions, Megarry, V-C placed store upon the resolution of the somewhat vexed, though popular, question whether a solicitor, who has a contract with his client, can be sued by the client for damages for the tort of negligence. His Lordship apparently saw some connection between a possible duty of care owed in tort to a client  [*55] and a duty of care owed in tort to third parties. In Midland Bank Trust Company Ltd. v Hett, Stubbs and Kemp, [1979] Ch 384, Oliver, J had held that a solicitor was liable to his client in tort for negligence. Megarry, V-C, speaking of that decision, expressed in Ross v Caunters, at ([1980] Ch.) p. 308; ([1979] 3 All ER) p. 587 his “most respectful concurrence in an exhaustive and convincing discussion of a most complex subject”.

It would appear that both Oliver, J, and Megarry, V-C were of the view that, since Hedley Byrne v Heller, the law as enunciated in Groom v Crocker, [1939] 1 KB 194 “was not law”.

The decision of the Court of Appeal in Groom v Crocker, supra, was not referred to in Hedley Byrne v Heller. Groom v Crocker has been applied in cases decided after the Hedley Byrne decision: see Clark v Kirby-Smith, [1964] Ch 506; Cook v Swinfen, [1966] 1 All ER 248; [1967] 1 All ER 299; Heywood v Wellers (A Firm), [1976] QB 446, at p. 461.

In Belous v Willetts, [1970] VR 45, at p. 46; Gillard, J held that a client’s action against his solicitor “for so-called negligence [*56] in his professional services, lies in contract”. As a consequence of this finding, his Honour struck out a paragraph of the defence, which had alleged contributory negligence. (For an interesting discussion see “Contributory Negligence as a defence to actions for breach of contract”, 55 ALJ 278).

In my opinion, Hedley Byrne v Heller did not overrule nor undermine the foundation of Groom v Crocker. It is still, in my view, the law in Victoria, as we should apply it, until it is overruled.

If no contract can be established between a solicitor and another person, a Hedley Byrne duty of care may arise and be owed by the solicitor to that other person. The Hedley Byrne v Heller principle applies to solicitors in the same way in which it would apply to any other person who fell within the principle of that case. But it was stressed in Hedley Byrne v Heller that it is necessary to establish that a special relationship of proximity exists between the representor and representee, and evidence of knowledge of reliance and reliance in fact will go to establish the “special relationship”. This of course, is said, in Australia, subject to the qualification placed upon the Hedley Byrne principle [*57] by the Privy Council in Mutual Life and Citizens Assurance Co. v Evatt, [1971] AC 793; (1968) 122 CLR 556 (HC); (1970) 122 CLR 628 (PC).

That is not this case: here we have a contract for reward between solicitor and client. Where a contract for reward is expressly or impliedly made between the two, I prefer the view that, subject to any express term of the contract, there will be implied in the contract a term that the solicitor shall exercise due care and professional skill in the performance of his duties under the contract. Spondet peritiam artis et imperitia culpae adnumeratur. He solemnly promises to exercise the skill of his profession, and by failing to exercise it is accountable for his fault: (i) Bean v Wade (1885) 2 TLR 157, at pp. 158-9: (ii) Hughes v Tivisden (1886) 55 LJ Ch 481; (iii) Bowen v Blair, [1933] VLR 398; (iv) Sutcliffe v Thackrah, [1974] AC 737; (v) Arenson v Arenson, [1977] AC 405, at p. 430; (vi) Aluminium Products (Qd.) Pty. Ltd. v Hill and Ors., [1980] Qld R 362. A contract is not a one-sided matter. The solicitor undertakes to perform his side [*58] of a bargain and the client undertakes to perform his. To say that the solicitor is, apart from his contractual duties, bound also by some superimposed duty of care arising, irrespective of the terms, express or implied, of his contract, appears to me to be unwarranted, for it runs counter to the law of contract.

A contract “is a promise or set of promises which the law will enforce”. Winfield Pollock on Contracts 13th ed., p. 1; American Restatement of Contracts, p. 1; Chitty on Contracts 23rd ed., p. 1.

The solicitor is contractually bound to keep his promise. He is not in my opinion bound to do any more. However, this interesting side issue seems to me to have nothing to do with this case.

As between the solicitor’s client and himself, the solicitor’s duties are usually governed by a contract, express or implied. There may be circumstances in which his work will involve the giving of advice, the making of estimates or the like, matters falling outside any contract, but which he knows, or ought reasonably to know, will be relied upon by his client and others and which, if wrong, will affect them financially. In such circumstances, depending upon the facts of any particular [*59] case, a Hedley Byrne v Heller duty of care to others may well arise at common law in tort.

However, if a solicitor who breaches his contract with his client may be sued for damages in tort by his client, I do not follow the reasoning whereby it is inferred that it may be more readily understood that he also owes a third party a separate duty of care.

The two matters appear to me to have nothing to do with one another.

It is quite clear that a person may owe a contractual duty to one person to do something, and in the doing of that very same thing he may at the same time owe a tortious duty of care to another, e.g. Voli v Inglewood Shire Council (1963) 110 CLR 74, at p. 85.

Martin v The Great Indian Peninsula Railway Co. (1867) LR 3 Ex 9 provides the simplest of examples. There, the defendant had contracted with the Indian Government to carry certain baggage belonging to the plaintiff, and whilst doing so the baggage was destroyed through the defendant’s lack of care. The plaintiff sued for damages. The defendant demurred, pleading its contract with the Indian Government. Baron Bramwell said: “The plaintiff says, ‘You [*60] had my goods in your possession and you delivered them wrongly, no matter whether wilfully or negligently: either way you did wrong’. The defendants’ reply, ‘I bargained with someone else to carry them’. But how does this furnish an answer? The contract is no concern of the plaintiff’s; the act was nonetheless a wrong to him. On the demurrer to this plea, the plaintiff is entitled to judgment.”

This case also demonstrates the complete independence of the right of the third party to bring an action for damages from the rights and duties of the contracting parties. But he must first be owed a duty of care, and have a corresponding right.

However, in Midland Bank v Hett, Stubbs and Kemp, [1979] 1 Ch, at p. 432, Oliver, J expressed the view that Hedley Byrne v Heller and Partners “establishes a general duty arising by law from a relationship of the type therein described however that relationship is established. It is therefore, in my view, inconsistent with the underlying reasoning of Groom v Crocker, [1939] 1 KB 194 and the cases which followed”. Megarry, V-C accepted this view in Ross v Caunters, [1980] 1 Ch 297; [*61] [1979] 3 All ER 580.

Then by a process of extrapolation (that I do not follow) his Lordship held that, either by an “extension of the Hedley Byrne principle or more probably by an application of Donoghue v Stevenson”, a common law duty of care was owed by a solicitor to a beneficiary proposed by his client.

His Lordship’s reluctance to rely solely on the Hedley Byrne principle is readily understandable. In that case, the House had stressed the need to find a “special relationship” which was “equivalent to contract”, or equivalent to “an agreement or undertaking to be careful”: (i) per Lord Reid, [1964] AC 465, at p. 492; (ii) per Lord Morris, at pp. 503-4; (iii) per Lord Hodson, at p. 514; (iv) per Lord Devlin, at pp. 522 and 529-30; (v) per Lord Pearce, at p. 539.

In that case, both the “undertaking” of responsibility by the defendant and the “reliance” of the plaintiff on the defendant were vital to the decision. And most importantly, because the “undertaking” was qualified by a disclaimer, the hypothetical duty did not in fact arise.

Similar approaches had been evident in the judgments in Banbury v Bank of Montreal, [1918] AC 626, at p. 654;  [*62] Nocton v Lord Ashburton, [1914] AC 932, at p. 972; Donoghue v Stevenson, [1932] AC 562, at pp. 603, 619 and 620.

But there was no such “undertaking” of any responsibility by the solicitor here. He promised his client to draw a document and have it properly executed. He breached that promise and was liable for the consequences of that breach.

Finally, there was no reliance placed on the solicitor by the beneficiaries. They did nothing at all. They were, so far as the evidence goes, oblivious of the terms of the will, and oblivious of the existence of the solicitor. They ventured nothing in reliance upon the solicitor’s skill.

Accordingly it does not seem possible to equate the facts of the present case with those of Hedley Byrne v Heller, and the ratio of that case appears to be altogether removed from the present case.

Looking at the ratio of Donoghue v Stevenson, there was clearly no physical propinquity here and no foreseeable risk of injury to the person or property of another.

Is there between the solicitor and the nominated beneficiary such “proximity” (in the “metaphysical” sense) as to give rise to a duty of care?

In Ross v Caunters it was the fact that it [*63] could be foreseen that the beneficiary might lose a so-called “benefit” which led his Lordship to conclude that there was such “proximity”.

The assumption is made that a gift to a beneficiary in a will is a “benefit” to him or her. I have already pointed out that it may not be. In the present case, the testator’s widow, according to the invalid will, was given a right of residence or possibly a life interest in the subject land. But, by an earlier will, which was in fact proved, she received a gift of an estate in fee simple. Did the solicitor know of this? On an intestacy, she would have benefited similarly. So that what may have appeared to a “benefit” to her in the invalid will, was in fact a taking away or lessening of what otherwise she would have received–and did in fact receive.

Should a solicitor know to whom he owes a duty? If the solicitor, on being given his instructions by the client, had deliberately, but for some misguided reason dissuaded him from making a will in the proposed form, I doubt whether anyone would suggest that a duty of care owed by the solicitor to the proposed beneficiary would have arisen or been breached. If the solicitor had failed in his [*64] misguided endeavour to dissuade his client from making the proposed dispositions, and had then deliberately or negligently delayed drawing the will according to instructions, and the client died before his wishes could be given testamentary effect, would a duty of care, owed by the solicitor to the proposed beneficiary, have arisen and have been breached? I think not. There was no relevant proximity.

The receipt of a gift by the terms of the will may cause a beneficiary to be disqualified from receipt of other “benefits” to which, without the testamentary gift, he would have been entitled. But a solicitor may know nothing of this. Is it sufficient that he knows that there may be some persons who could be disadvantaged as a consequence of his negligent (or deliberate) breach of his contract with his client?

If the client simply wished to disinherit X by a codicil without caring who took as a consequence, would a duty of care to ensure that this was properly done be owed by the solicitor to those who in fact would be benefited (enriched) by the disinheritance? And if the codicil was invalid, by reason of the solicitor’s failure to exercise professional skill, and X took his gift,  [*65] would the solicitor be liable to pay as damages for breach of duty to those others, the value of the gift given to X? They could be persons named in the will or persons altogether outside the will, e.g. in the case of powers of appointment.

In examining the way in which this supposed duty of care might be said to arise as a consequence of the so-called “proximity” of the solicitor to the named or hypothetical beneficiaries, it appears to me highly unlikely that any such proximity, as contemplated in the authorities, exists.

In Ross v Caunters, [1980] 1 Ch 297, at p. 309A; [1979] 3 All ER 580, at pp. 587-8, Megarry, V-C said: “When a solicitor undertakes to a client to carry through a transaction which will confer a benefit on a third party, it seems to me that the duty to act with due care which binds the solicitor to his client is one which may readily be extended to the third party who is intended to benefit.”

I have already stated my reasons why I think a third person cannot rely upon any contract between solicitor and client. If a tortious duty is owed because of the relationship between the solicitor/client, I am  [*66] not able to see how it “may readily be extended to the third party”. This is a non sequitur as a matter of law.

Again it seems to me that the necessary emphasis in the above passage from Ross v Caunters on the fact that the transaction is one “which will confer a benefit on a third party” points to the inherent heresy of a jus quaesitum tertio arising out of contract.

In Donoghue v Stevenson the contract between the manufacturer and the retailer had nothing to do with the duty which the manufacturer was found to owe to the consumer. It was of the essence of the “proximity” which was found to exist there that the manufacturer intended that his product be consumed by a consumer in the form in which it left him, and that he knew that the consumer would rely (as the consumer did) on the purity of the product put forth, and not subject it to intermediate examination. See also: Grant v Australian Knitting Mills, [1936] AC 85. But there is no such reliance or proximity in the present case, and the presumed effect of the terms of the contract between the solicitor and client appears to be relied on as the determinant whether or not a duty of care is owed to a third party by the solicitor.  [*67] Because the client intended to confer a benefit, it is said that a duty arose. If he had not intended to do so, no duty arose. If a duty is owed by a solicitor to a third party (whether beneficiary or not) it cannot depend on the intention of the solicitor’s client. At best, the contract may demonstrate the nature of the work that the solicitor undertook to do, and how it may, if badly done, injure third parties who rely on it, and may be expected to do so.

In Voli v Inglewood Shire Council (1963) 110 CLR 74, at p. 85 Windeyer, J said (my underlining): “First, neither the terms of the architect’s engagement, nor the terms of the building contract, can operate to discharge the architect from a duty of care to persons who are strangers to those contracts. Nor can they directly determine what he must do to satisfy his duty to such persons. That duty is cast upon him by law, not because he made a contract, but because he entered upon the work. Nevertheless his contract with the building owner is not an irrelevant circumstance. It determines what was the task upon which he entered. If, for example, it was to design a stage to bear only some specified weight,  [*68] he would not be liable for the consequences of someone thereafter negligently permitting a greater weight to be put on it.”

This passage, in my respectful opinion, correctly states the law.

The reason that the duty arose in that case was that the architect could foresee that persons outside the contract would act in reliance upon the safety of the stage to be erected pursuant to his contractual design, and that they would be likely to be physically injured if his work was performed without due professional care and skill. The architect knew that the stage he designed was to be erected to carry people who would rely on it. The same line of reasoning is found in Donoghue v Stevenson, where the ginger beer was manufactured to be drunk, and being contained in an opaque bottle, the consumer relied on the manufacturer (as the latter knew he would) to exercise due care to avoid deleterious additives.

These elements of reliance, which in my opinion were material to the relevant “proximity” giving rise to a duty of care, are absent in the present case. The present case is one, as Megarry, V-C points out, in which what he characterized as “financial loss is directly caused by the solicitor’s [*69] breach of that duty, and reliance by the plaintiff is irrelevant”: [1980] 1 Ch 297, at p. 313; [1979] 3 All ER 580, at. p. 591. But this statement may beg the question, Is there any duty? Reliance is one of the vital considerations to look for before answering this question; not after it has been answered by assumption. His Lordship went on to say: “If the duty of care is imposed on what I may call pure Donoghue v Stevenson principles, and the loss occurs without being dependent on any reliance by the plaintiff, then I cannot see how the presence or absence of reliance by the plaintiff can affect liability: see for instance Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, 413.”

But Lord Atkin was at pains in Donoghue v Stevenson to stress the importance of “reliance” as a vital element assisting to establish that a duty existed. Having quoted from Brett, MR (dissentient) in Heaven v Pender (1883) 11 QBD 503, at p. 509, he said (my underlining): “I draw particular attention to the fact that Lord Esher emphasizes the necessity of goods having to be ‘used immediately’  [*70] and ‘used at once before a reasonable opportunity of inspection’…–in the class of case now before the Court, I cannot conceive any difficulty to arise. A manufacturer puts up an article of food in a container which he knows will be opened by the actual consumer. There can be no inspection by any purchaser and no reasonable preliminary inspection by the consumer”: [1932] AC 562, at p. 582. In his final formulation of the proposition, his Lordship said (my underlining): “A manufacturer of products, which he sells in such a form as to show that he intends them to reach the ultimate consumer in the form in which they left him with no reasonable possibility of intermediate examination, with the knowledge that the absence of reasonable care in the preparation or putting up of the products will result in an injury to the consumer’s life or property, owes a duty to the consumer to take that reasonable care”: [1932) AC 562, at p. 599.

What then do other authorities say on the subject? Robertson v Fleming (1861) 4 Macq 167, a case decided in the House of Lords, is a case directly in point. The appellant, a law agent in Glasgow, was alleged by the respondents [*71] to have been employed “for their behoof” in his professional capacity to complete a transaction, which, by his assumed negligence, was not completed. The defence was a denial of the employment. Briefly, the facts were that a grocer named Hamilton borrowed money from some money lenders who required sureties. The respondents agreed to be sureties, being aware that the grocer, Hamilton, had certain leasehold property worth more than the sum borrowed, and Hamilton agreed with them to complete the necessary security over this property in favour of the respondents. Hamilton engaged the appellant to prepare the security. This the appellant did, but he “omitted to intimate the assignation to the landlord”, keeping the security himself and he did not tell the respondents that it was necessary to give notice to perfect their right. On Hamilton’s subsequent bankruptcy, the security which the respondents relied on was accordingly worthless and they sued the appellant, and on certain issues being directed for trial, a verdict was returned for the respondents. The matter eventually came before the House, and on the merits, the appellant contended that without privity of contract there could be  [*72] no liability.

The Lord Chancellor, Lord Campbell, after stating that there was no privity of contract established, and that the solicitor was not a “public functionary”, said (underlining mine): “I never had any doubt of the unsoundness of the doctrine…that A employing B, a professional lawyer, to do any act for the benefit of C, A having to pay B, and there being no intercourse of any sort between B and C,–if through the gross negligence or ignorance of B in transacting the business, C loses the benefit intended for him by A, C can maintain an action against B, and recover damages for the loss sustained. If this were law a disappointed legatee might sue the solicitor employed by a testator to make a will in favour of a stranger, whom the solicitor never saw or before heard of, if the will were void for not being properly signed and attested. I am clearly of the opinion that this is not the law of Scotland, nor of England, and it can hardly be the law of any country where jurisprudence has been cultivated as a science.” Lord Cranworth reiterated these sentiments at ((1861), 4 Macq.) pp. 184-5, and Lord Wensleydale stated, at p. 199: “It is said, however, that by the law of  [*73] Scotland, quite independently of the question who the contracting parties are, whenever an attorney or agent is employed by anyone to do an act which when done will be beneficial to a third person, and that act is negligently done, an action for negligence may be maintained by the third person against the attorney or agent. I cannot think that any such proposition is made out to be part of the law of Scotland.”

Lord Chelmsford stressed the importance of deciding to whom the solicitor owed a duty, pointing out that if the bond and assignation had in fact been notified to the landlord, the rights of one Ballantyne, to whom the client Hamilton had already and earlier “granted an onerous assignation in absolute terms” (and of which the defender solicitor knew), would have been defeated: see (4 Macq.) pp. 171 and 210. The case provides a good example of the problem of conflicting duties, should one once countenance that a solicitor owes an “incidental duty” to third parties.

In Dutton v Bognor Regis Urban District Council, [1972] 1 AC 373, at p. 394, Lord Denning, MR the modern champion of the jus quaesitum tertio, considered the “Position of the Professional Adviser” and when touching [*74] on counsel’s submission in the case said: “He said that such a professional man owed no duty to one who did not employ him but only took the benefit of his work… To support this proposition, Mr Tapp brought out a long forgotten case in the House of Lords called Robertson v Fleming (1861) 4 Macq 167. It was a Scottish case about the responsibility of a lawyer. Lord Wensleydale said, at p. 199: ‘He only, who by himself, or another as his agent, employs the attorney to do the particular act in which the alleged neglect has taken place, can sue him for that neglect,….’ “That observation was made in 1861 when the legal profession laboured under the fallacy which I have already mentioned–the fallacy by which it was thought that, when one contracting party was negligent, no one could sue him for that negligence except the other contracting party. That doctrine did not avail manufacturers after 1932–Donoghue v Stevenson, [1932] AC 562; nor did it avail professional men after 1964–Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., [1964] AC 465. In neither of these cases, strangely enough, was Robertson v Fleming (1861) 4 Macq 167 [*75] referred to. But the result of them is to lessen the authority of that case and the observations in it.”

I have already indicated that in my opinion the ratios of Donoghue v Stevenson and Hedley Byrne v Heller depended on finding knowledge of reliance and reliance in fact and, in the latter case, a “special relationship” between the representor and representee, a relationship “akin to contract”. The knowledge of the representor that in the circumstances the representee would, as he did, rely on his statement and act to his detriment, if it was not correct, was, as Lord Denning himself has pointed out, vital to the decision in Hedley Byrne v Heller. In the absence of contract, something “equivalent to contract” was found to fill the gap. A Hedley Byrne v Heller duty of care does not arise from or out of any contract, but rather in the absence of any contract with the person to whom the duty is owed. A contract will triumph over it, as did the disclaimer in that case.

In Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, at pp. 394-5 Lord Denning, MR said: “Nowadays since Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., [1964] AC 465 [*76] it is clear that a professional man who gives guidance to others owes a duty of care, not only to the client who employs him, but also to another who he knows is relying on his skill to save him from harm. It is certain that a banker or accountant is under such a duty. And I see no reason why a solicitor is not likewise. The essence of this proposition, however, is the reliance. In Hedley Byrne v Heller it was stressed by Lord Reid at p. 486, by Lord Morris of Borth-y-Gest at pp. 502-503 and by Lord Hodson at p. 514. The professional man must know that the other is relying on his skill and the other must in fact rely upon it.” This would appear, with the greatest respect, to be an impeccable statement of the law.

It should not be thought that, although all members of the House in Robertson v Fleming were quite clear that a third party to a contract cannot sue for breach of the contract, they were unaware that third persons might, by something akin to contract, be owed a duty, for the Lord Chancellor stated, at (4 Macq.) pp. 177-8: “But if in a transaction of borrowing and lending money on security, A the borrower, employs B, a professional lawyer to transact the business, in  [*77] which both A the borrower and C, the lender, have their separate interests, and for which A alone is to pay B, although C has no personal intercourse with B, if from the instructions expressly given by A to B, or from the usual course in which such business is conducted, B knows that he and no other professional lawyer is employed in the transaction, and that B is to act both for A and for C in preparing the security, I apprehend that a jury from this employment of B might infer an undertaking from B to C to conduct the transaction on his part with reasonable skill and diligence.”

In the present case, the question appears to me to be whether there is any relevant proximity giving rise to a duty of care to a third person, arising as a consequence of a contract between A and B and in the absence of any undertaking to or reliance by C.

In Dutton v Bognor Regis Urban District Council, supra, Lord Denning, MR when considering whether a duty was owed by an inspector of foundations of a house to a subsequent purchaser said, at ([1972] 1 QB) p. 395 “It is at this point that I must draw a distinction between the several categories of professional men. I can  [*78] well see that in the case of a professional man who gives advice on financial or property matters–such as a banker, a lawyer or an accountant–his duty is only to those who rely on him and suffer financial loss in consequence. But in the case of a professional man who gives advice on the safety of buildings, or machines, or material, his duty is to all those who may suffer injury in case his advice is bad.”

In this latter category his Lordship placed analysts, inspectors of lifts, architects and engineers. These professional men may, he said, be liable “not because those injured relied on him, but because he knew, or ought to have known, that such persons might be injured if he did his work badly”. He found support for this view in the American case Nelson v Union Wire Rope Corporation (1964) 199 NE Rep (2d) 769, where a lift inspector was held to owe a duty to all those who might be “endangered” by his negligently given certificate of safety. His Lordship was considering physical injury or injury to property. It seems that in his Lordship’s view a different test is to be applied, depending on whether the evil likely to be done is on the one hand, purely [*79] economic or on the other hand, physical. It is not surprising that in Sparham- Souter v Town and Country Developments (Essex) Ltd. and Anor., [1976] QB 858; [1976] 2 All ER 65, at p. 68, he said, “In recent times the law of negligence has been transformed out of all recognition”.

But even on the basis of the rationale applied in Dutton v Bognor Regis Urban District Council, supra, by Lord Denning, the plaintiffs in the present case would fail, for reliance is altogether absent, and there was no damage to person or property of the plaintiffs to be apprehended.

The House of Lords in Anns v Merton London Borough Council, [1978] AC 728; [1977] 2 All ER 492, approved Sparham-Souter v Town and Country Developments (Essex) Ltd., supra, and explained and applied Dutton v Bognor Regis Urban District Council, supra. All of these cases were concerned with the Limitation Act (Eng.) and with public officials exercising statutory powers or duties. Similar considerations of the circumstances in which a duty is owed by such officials are found in Home Office v Dorset Yacht Co. Ltd., [1970]  [*80] AC 1004; [1970] 2 All ER 294 and East Suffolk Rivers Catchment Board v Kent, [1941] AC 74; [1940] 4 All ER 527.

It has been recognized as long ago as that “long forgotten case” (Robertson v Fleming (1861) 4 Macq 167, at p. 177) that “public functionaries” stand in a special category. In my opinion, these cases, dealing often with limitation issues and raising issues as to the bona fide discretionary actions of public officials, as to the purpose for which they have been invested with authority, as to the reliance of the public on the responsible performance by them of their statutory or regulatory powers or duties, and as to the risk of “endangering” life, limb or property, do not lay down principles of much assistance when considering whether the solicitor in the present case was in a “duty-situation” apropos the beneficiaries in his client’s proposed will: see Lord Morris of Borth-y-Gest in Dorset Yacht Case, [1970] AC 1004, at p. 1038.

In the most recent of the “landmark” cases, Anns v Merton London Borough Council, [1978] AC 728, Lord Wilberforce in a judgment with which Lord Diplock, Lord Simon [*81] of Glaisdale and Lord Russell of Killowen expressed agreement said, at pp. 721-2: “The question has to be approached in two stages. First one has to ask whether, as between the alleged wrongdoer and the person who has suffered damage there is a sufficient relationship of proximity or neighbourhood such that, in the reasonable contemplation of the former, carelessness on his part may be likely to cause damage to the latter– in which case a prima facie duty of care arises. Secondly, if the first question is answered affirmatively it is necessary to consider whether there are any considerations which ought to negative, or to reduce or limit the scope of the duty or the class of person to whom it is owed or the damages to which a breach of it may give rise.”

Counsel for the respondents in this appeal relied chiefly on this case.

Assuming for the purpose of the first question that the beneficiary is a “person who has suffered damage”, it is my view that for the reasons already expressed, there is not on the facts of the present case, a “sufficient relationship of proximity” to be found between the proposed beneficiary and the solicitor to give rise to a duty of care owed by the  [*82] solicitor to the beneficiary. I intend now to turn to look at the question, Has any relevant “damage” been suffered? This may be a question which must be decided independently of the issue whether in tort one can recover damages for “economic loss”? This latter issue was considered in SCM (United Kingdom) Ltd. v Whittall (WJ) and Sons Ltd., [1971] 1 QB 137; Spartan Steel and Alloys Ltd. v Martin and Co. (Contractors) Ltd., [1973] QB 27; French Knit Sales Pty. Ltd. v N Gold and Sons Pty. Ltd., [1972] 2 NSWLR 132 and authoritatively decided by the High Court in Caltex Oil (Australia) Pty. Ltd. v The Dredge “Willemstad” (1976) 136 CLR 529.

The question which I wish briefly to consider is: “Has the ‘disappointed beneficiary’ suffered ‘damage’ which is recognizable in law as such?” For damage actually done is the gist of the action on the case. Ratcliffe v Evans, [1892] 2 QB 524, at pp. 532-3 per Bowen, LJ In the first place, neither his bodily health nor mental health has been affected. Next, his property remains undamaged.

In Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, at p. 413 [*83] Stamp, LJ was prepared to assume for the moment that Robertson v Fleming (1861) 4 Macq 167 supported the proposition that a person has no duty so to act as to confer an advantage on his neighbour. “The proposition assumes that what C loses is an intended benefit and his position, after the act of carelessness by A is precisely the same as it was before”: see ([1972] 1 QB) at p. 413. Is that assumption consonant with the facts here?

It may be said that a windfall has been snatched in limine from the respondents. Nothing in possession has been removed or impaired. Nothing earned or to be earned has been lost. No interest in property has been touched. Nothing transferable in the eyes of the law has been affected. Is the position of the solicitor different from that of a man C to whom a valuable chattel is given for custody by the owner A with the words, “Look after this for me. I intend to give it to X next week. That’s my present intention.” Next week A, on returning to C to collect the chattel and to give it to X, is told by C that, through his negligence, the chattel has been stolen or lost. Can X sue C? I think not. X had no interest in it recognizable [*84] at law. How is the disappointed beneficiary any different? I do not for the moment see.

A spes successionis is not a title to property and cannot be disposed of by will. It differs from a contingent gift. James v Roe (1789) 3 Term Rep 88; Re Parsons (1890) 45 Ch D 51; Re Ellenborough, [1903] 1 Ch 697; Re Middleton’s Will Trust, [1969] 1 Ch 600, at pp. 607-8; Theobald on Wills, 13th ed., para. 285, p. 103. What we are considering here is not even a spes successionis, which is an expectation or hope of succeeding to property as heir at law or next of kin of a living person, for example, under intestacy provisions.

No legal right enjoyed by the beneficiaries has been infringed. The plaintiffs were volunteers whom equity would not assist; nor would equity perfect the imperfect gift. As Dixon, J said in Brunker v Perpetual Trustee Co. (Ltd.) (1937) 57 CLR 555, at p. 599: “Being a volunteer, an intended donee cannot obtain equitable remedies against the donor compelling him to give legal effect to his intention to give.”

Looking at the property  [*85] in question, it has not suffered. It has not been harmed in any way. It has devolved, as the testator devised it, to the testator’s widow, who might, in any event, have been entitled to receive it on a PtIV application under the Administration and Probate Act 1958 (Vic.). No one knows what she intends to do with it, either during her lifetime or on her death. Nor do we know how it would devolve on her dying intestate, and possessed of it. Megarry, V-C in Ross v Caunters, [1980] 1 Ch 297 stated, at p. 321; [1979] 3 All ER 580, at p. 598, that counsel “bravely contended that in this case the plaintiff had suffered no financial loss. Nothing of hers had been taken away or destroyed; she had merely failed to get something extra. All that she had lost was a mere spes. The point, he said, was devoid of authority; and I am not surprised…In this case, but for the negligence of the defendants, the plaintiff would have received a share of the residue of an ascertainable amount: that amount is no mere spes. It is, indeed, the amount of the plaintiff’s loss. I do not think that the expression ‘loss’ can be confined to deprivation. To me,  [*86] a failure to receive an assured benefit is a loss. If a gift in transit to a donee is destroyed or stolen, I think both English usage and common sense would accept that the donee has suffered a loss even if the property had not passed. In saying that, I do not forget Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, 413. In my judgment, there is nothing in this point.”

I find myself unable to share his Lordship’s assurance.

At the time when the assumedly negligent act was performed by the solicitor, namely when the will was attested invalidly, it is I think beyond argument that, if the negligence had been then and there discovered, no action by the beneficiary against the solicitor could have been brought for the tort of negligence. It is true that the solicitor’s client, the testator, could have sued him for breach of contract, but as no damage had been suffered by the beneficiary, the assumed tort of negligence apropos the beneficiary was incomplete.

The tort of negligence may be described as the infliction of damage as a result of a breach of duty of care owed by the defendant to the plaintiff: Lochgilly Iron and Coal Co. v McMullen,  [*87] [1934] AC 1, at p. 25, per Lord Wright.

The “kind of damage” recognized by law clearly includes physical injury to person and property. But purely pecuniary loss is recognized to a very limited extent. Clerk and Lindsell on Torts, 13th ed., para . 859 (cases to note 44).

In Caltex Oil (Australia) Pty. Ltd. v The Dredge “Willemstad” (1976) 136 CLR 529 all members of the Court thought that the plaintiff, who suffered economic loss because the pipeline belonging to another was negligently damaged by the defendant’s dredge, could recover damages.

Property damage to another was caused; but the plaintiff individually, and not merely as a member of an ascertained class, was one whom the defendant knew or ought to have known would be likely to suffer economic loss as a consequence: per Gibbs, J, at ((1976), 136 CLR) p. 555, per Mason, J, at p. 593. There was accordingly a sufficient degree of proximity: per Stephen, J, at p. 558.

The case demonstrates different approaches to the problem in question.

In those cases in which economic or purely pecuniary loss has been recognized as a kind of damage sufficient to constitute this element in the tort of [*88] negligence, the loss has always been of a kind that would have been recoverable if it had been incurred as a consequence of a direct physical injury to person or property, e.g. loss of earnings or profits or costs and expenses directly occasioned by the negligently inflicted injury to person or property. In the present case the damage allegedly constituted by the loss of a testamentary gift does not fall into any category of legally recognized damage of which I am aware.

Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., [1964] AC 465; [1963] 2 Al ER 575 has opened the way for the recognition of new duty-situations where pecuniary loss alone constitutes the damage. But it has not, as I see it, affected the principle that a duty-situation recognized at law must be made out, and that pecuniary loss recognized at law must be established: cf. Konstantinidis v World Tankers Corporation, The World Harmony [1967] P 341, at pp. 361-2; Weller and Co. v Foot and Mouth Disease Research Institute, [1966] 1 QB 569.

The action “per quod” for loss of services is an anomaly and is strictly confined to its present limits. Simply by way of example, I refer to the [*89] case of Attorney-General for NSW v Perpetual Trustees Co. Ltd., [1955] AC 457 (PC). The Governor of New South Wales unsuccessfully claimed damages from a person who had negligently injured a policeman, and thus deprived the plaintiff of his services.

Lord Simonds delivered the opinion of the Board and said, at ([1955] AC) p. 484: “…it is fundamental (as Rich, J pointed out in Quince’s Case ((1944) 68 CLR 277, 240) that the mere fact that an injury to A prevents a third party from getting from A a benefit which he would otherwise have obtained, does not invest the third party with a right of action against the wrongdoer (see Societe Anonyme de Remorquage a Helice v Bennetts, [1911] 1 KB 243).”

This passage is referred to by Widgery, J, who reaffirmed its statement of principle in Weller and Co. v Foot and Mouth Disease Institute, [1966] 1 QB 569, at p. 584, and his Lordship went on to say, at p. 585, that: “the world of commerce would come to a halt and ordinary life would become intolerable if the law imposed a duty on all persons at all times to refrain from any conduct which might foreseeably [*90] cause detriment to another, but where an absence of reasonable care may foreseeably cause direct injury to the person or property of another, a duty to take such care exists.”

In the present case, the beneficiary had no legally recognized interest in the devise, at any relevant time. He was not even entitled to expect its “benefit”.

In Margarine Union GmbH v Cambay Prince Steamship Co., [1969] 1 QB 219 the plaintiffs had accepted delivery orders relating to a quantity of copra, thereby acquiring title thereto when the goods were unloaded, but not earlier. The copra was damaged by cockroaches on the ship, through the admittedly negligent failure of the defendant shipowners to fumigate the vessel. The question for the court was, “Had the plaintiffs a good cause of action against the defendants in tort in respect of damage to the copra?”

Plaintiffs’ counsel relied on Donoghue v Stevenson and Hedley Byrne v Heller, submitting that to argue that no remedy lay because the plaintiff had no property in the goods at the time when they were damaged was to argue an artificial limitation which, on the principle of these cases, was out of sympathy with the modern [*91] approach of the courts.

Roskill, J stated the plaintiffs’ argument to be that “since at least Donoghue v Stevenson and still more since Hedley Byrne’s Case it was clear that foreseeability alone was the test, so long only as there was physical damage to goods which ultimately became the property of or came into the possession of the plaintiffs and so long as the plaintiffs or others in the position of the plaintiffs were not too far removed from the range of foreseeability or proximity as to be outside the principles laid down in Donoghue v Stevenson and in Hedley Byrne’s Case”: [1969] 1 QB 219, at p. 235. Following a thorough examination of the authorities his Lordship rejected the argument, as being contrary to principle, the principle being that even when a person can foresee that his negligent act will cause damage to the consignee of goods ([1969] 1 QB 219, at p. 233), the consignee, on acceptance of the goods, cannot bring an action for damages in tort for negligence if he had no legal or possessory title or right to the goods at the time of the negligent act causing damage or at the time of the damage itself. See also [*92] Simpson v Thomson (1877) 3 App Cas 279, per Lord Penzance, at pp. 289-90.

In the present case it is not even suggested that the plaintiff beneficiaries had a legal title or right or expectation to the subject land either at the time that the invalid will was made, or at the date of the testator’s death. But Megarry, V-C thought that on the death of the testator the tort of the beneficiary, inchoate until then, and able to be undone (if the testator made a new will or remade the invalid will) was complete, and that the measure of damage was the value of the proposed testamentary benefit. I do not accept this approach. It runs counter to principle.

It was submitted that the finding of new duty-situations is a matter of “policy” and that this Court should find such a duty-situation here. But it has also been said that judges are better at expounding the law than they are at expounding “policy”. It is therefore with some trepidation that I make brief reference to matters which might be considered to be matters of “policy”.

A great deal of the work of a solicitor must affect persons with whom his client is related, whether by contract, in business, by [*93] relationship or by marriage. Mistakes made may involve others, either assisting the client and disadvantaging others, or vice versa. I have mentioned that in the present case the client’s widow was advantaged by the solicitor’s mistake. His nephews, (the respondents) were not. No doubt in matters concerning wills countless combinations and permutations could occur, depending on the rub of the green. The apparent simplicity of the present case, from a factual viewpoint, should not be allowed to obscure the truth of the proposition that, once it is acknowledged that a duty-situation arises here, many difficult and more complex situations must follow. Where is the line to be drawn? Is the solicitor’s duty to third parties to be confined to named beneficiaries in a will? Or would it extend to classes? Would the solicitor’s duty to third parties require him to advise the testator of the provisions of PtIV of the Administration and Probate Act 1958 (Vic.), so that the testator by an informed distribution of his assets, did not disadvantage those whom he particularly intended to benefit? Should the solicitor be excused from a finding of negligence if, as in the American case (Lucas v Hamm (1961) 11 Cal Rpter 727), [*94] the jury advocate (now Judge) thought that a solicitor should be excused for not understanding the rule against perpetuities and its implications. Would the solicitor who, through incompetence, persuaded the testator to leave his assets in a certain way, intended by the testator to benefit a third party (but which as it turned out did not do so), be liable to that third party in an action for damages for negligence?

Would the solicitor who warned the client that the gift might fail, but whom the client nonetheless instructed to draw the will in a particular way, avoid liability to the third party? And would a disclaimer of any responsibility for negligence to the client avail the solicitor in an action by the third party for negligence? Would it be necessary to notify the beneficiaries of the disclaimer? Would the client allow this?

Megarry, V-C decided that the duty owed by a solicitor to a third party beneficiary is to “use proper care in carrying out the client’s instructions for conferring the benefit on the third party”: Ross v Caunters, [1980] 1 Ch 297, at p. 322. Does “proper care” include advising the client with professional care and skill [*95] as to the effect and likely consequences of the gift apropos all possibly affected parties or does it require merely the formal implementation of the client’s wishes, however odd they may be, and whatever be the likely legal result of the gift to the third party?

In Robertson v Fleming (1861) 4 Macq 167 the law agent knew of a prior charge of similar nature granted by his client over the subject property, and knew that notice of assignation of the subsequent charge would defeat the prior charge, which also was unnotified to the head lessor. Where did his duty lie?

Somewhat similar considerations may well have arisen in the present case. The widow of the testator received an estate in fee simple in the matrimonial home and land under the earlier will, and the question arises: “Ought the solicitor to have advised his client that the proposed gift to his nephews (the plaintiffs), subject to a right of residence in the matrimonial home enuring to the benefit of the widow, might be expected on his death to call forth a PtIV application by the widow?”

Is the solicitor entitled with impunity to advise his client against benefiting a named third party?  [*96]

If solicitors are under a duty of care to third party volunteers, then, a fortiori, it would seem that the duty must also be owed to third party purchasers or vendors for value from and to their clients (whether represented or unrepresented), to third party grantees of easements, rights of way, to donees of gifts, and to all those third parties who would probably be benefited by any legal course proposed to be taken by the client. Does it extend to company transactions? It is difficult to see why it should be otherwise, if the duty arises simply because the third party “is a person within his direct contemplation as someone who is likely to be so closely and directly affected by his acts or omissions that he can reasonably foresee that the third party is likely to be injured by those acts or omissions”: Ross v Caunters, [1980] 1 Ch 297, at p. 323A.

The acceptance of the proposition that a duty of care arises in the circumstances of this case would mean that a solicitor, instructed by A to draw a deed of gift in favour of X, for execution by A before he flew to Rio, would, if the solicitor deliberately or negligently failed to draw the deed for execution,  [*97] be liable in damages to X, if A died in Rio.

What would be the position in the following circumstances? A, the client, desired to give a porcelain vase in his possession to B, the donee, by deed of gift to take effect immediately, and A engaged C his solicitor to draw the deed. C does so but fails to tell A to seal it (or, to deliver it). Some time later, A repents of his largesse and learning of the need to seal (or deliver) the document, instead tears it up? Is the donee entitled to sue the solicitor for breach of a duty of care he owed? Could it be successfully submitted that an expert wrapper of Ming vases would be liable to a named donee in damages if, after contracting with the donor to perfect what he was informed was a gift by wrapping it and delivering it to the oblivious donee, he carelessly dropped and smashed the vase at the donor’s home–or at any time before delivery? I think not.

Testing the proposition by the examples that come to mind reinforces me in the view that I have formed that in the circumstances of the present case there is neither damnum nor injuria demonstrated, and that, as a matter of policy a new duty-situation should not be found.

When turning [*98] to consider what in ordinary circumstances a reasonable solicitor drawing a will would contemplate, I doubt that he would ever imagine that he owed a duty of care to beneficiaries mentioned in his instructions taken from his client. Nor would he recognize (to use the words of Brett, MR in Heaven v Pender as applied by Lord Atkin in Donoghue v Stevenson) that “if he did not use ordinary care and skill in his conduct with regard to those circumstances he would cause danger of injury to the person or property” of the beneficiary.

If, however, it be thought that the duty issue in this case involves an exercise of the creative functions of the judiciary in controlling the area of legal responsibility for negligence, having regard both to the nature of the interests infringed and the type of conduct complained of, (Fleming on Torts, 4th ed., p. 136), there is abroad a philosophy, (sometimes termed policy), which espouses the spreading of losses through the community, by requiring insurance to be effected against all manner of risks, I do not believe that this is part of the judicial function of this Court.

Courts of last resort are more accustomed and better situated to engage in  [*99] such “policy decisions” than this Court is.

In my opinion an application of the law as it has developed and been expounded to date leads to the conclusion that this appeal should be allowed.

Finally, and without dilating on the matter, if damages are to be awarded, the measure of damage must be the same for each plaintiff. Each has lost an equal one-third share in a piece of real estate. If there was, as seems to have been strangely suggested, no market in Victoria for the sale of a reversionary interest such as we are considering, the loss was suffered none the less at the date of death of the testator–not at some future date such as the notional date of death of the testator’s widow.

It would only be in the latter circumstance that an assessment of the discounted amount to be paid to each plaintiff at the time of trial would take account of the notional tax to be paid by each of the plaintiffs on the income to be earned on any lump sum to be awarded.

But the sum to be awarded as damages is a sum of present day money, not money as at the date of death, and the value of the loss would take account of the fact that the share in the asset lost at the date of death was worth [*100] $ 15,333 at the date of the trial postponed in enjoyment for 14 odd years. There would be no need to “grope in the dark” and the Court would recognize this fact which was consequent on property and money values at the date of trial. Whatever $ 15,333 postponed for 14 odd years is worth when awarded today, that is the most that could be awarded. However, my opinion is that the appeal should be allowed on the first grounds argued, namely that no duty care existed in the circumstances of this case and that no damage recognizable at law has been suffered.

McGARVIE, J: Joseph William Byrne (“the client”) retained and instructed the appellant solicitor (“the solicitor”) to prepare a will which left a house property to the respondents (“the beneficiaries”) and their mother as tenants in common in equal shares. The client was the brother of the respondents’ mother. The interest of the respondents and their mother in the property was to be subject to the right of the client’s wife to live in the house as long as she wished. The solicitor prepared the will in accordance with his instructions. On 24 August 1973 the solicitor gave the client the will, told him where to sign it and was present [*101] when he did so. The solicitor and another person signed the will as witnesses but neither of them signed in the presence of the client. By s7 of the Wills Act 1958 the will was invalid because the client and the witnesses were not all present together when they signed it. As a result, after the client died, probate of the will was not granted. Probate was granted of an earlier will under which the beneficiaries received nothing.

The beneficiaries brought an action against the solicitor each claiming as damages the value of the interest which would have been received if the will had been valid. At the trial it was not contested that the solicitor had failed to take reasonable care to ensure that the will was properly executed. The defence was that the solicitor was not liable in negligence because he owed no duty of care to the beneficiaries.

The trial judge, Anderson, J, made his own analysis of the law and also followed Megarry, V-C in Ross v Caunters, [1980] 1 Ch 297; [1979] 3 All ER 580 and Burt, CJ in Watts v Public Trustee, [1980] WAR 97. He decided that the solicitor owed the beneficiaries a duty of care and was liable [*102] to them in damages for his negligence.

The value of the house property at the death of the client was $ 26,500. By the time of trial its value was $ 46,000. There was no evidence from a valuer or similar expert as to the value of the interests intended for the plaintiffs, at the death of the client or at the time of the trial, making allowance for the widow’s right to reside in the property. The trial appears to have been conducted by both counsel on the basis that any damages would be to compensate the plaintiffs for not receiving interests which would not in any event have been received until the death of the widow. There was actuarial evidence of amounts which would, if invested, produce particular sums at the end of the widow’s life expectancy. The evidence was that the plaintiff Dearsley had a substantial income but the plaintiff Perry did not have enough to be liable to income tax. The actuaries gave evidence that, having regard to the effect of income tax on income from investments, a larger amount would be needed to produce a particular sum for Mr Dearsley than for Mrs Perry. For this reason his Honour awarded Mr Dearsley damages of $ 9000 and Mrs Perry $ 6425.

The issues [*103] on the appeal are: 1. Whether the solicitor owed the beneficiaries a duty to use reasonable care to ensure that the will was properly executed. 2. If so, whether the beneficiaries have suffered damage. 3. If so, whether the correct measure was applied in assessing damages. Duty of care–first question The approach under the present law to establish whether a duty of care arises in a particular situation has recently been stated with clarity and authority by the majority of the House of Lords in Anns v Merton London Borough Council, [1978] AC 728, at pp. 751-2; [1977] 2 All ER 492, at p. 498 (Anns’ Case) in the words of Lord Wilberforce. The question is to be approached in two stages: “First one has to ask whether, as between the alleged wrongdoer and the person who has suffered damage there is a sufficient relationship of proximity or neighbourhood such that, in the reasonable contemplation of the former, carelessness on his part may be likely to cause damage to the latter, in which case a prima facie duty of care arises.”

In asking whether the relationship was such that in the reasonable contemplation of the alleged wrongdoer carelessness on his part [*104] may be likely to cause damage to the other, one looks at the actual situation in the particular case. The question is whether, objectively, the alleged wrongdoer ought reasonably to have foreseen that his carelessness may be likely to cause damage to the other. “Proximity” and “neighbourhood” mean no more and no less than that. That was the approach of Lord Wilberforce: see ([1978] AC) at pp. 753-4. In The Council of the Shire of Wyong v Shirt (1980) 54 ALJR 283 the High Court considered precisely what has to be foreseen. Policy considerations have no place under the first question. They come in under the second question. If the circumstances were such that the alleged wrongdoer would not reasonably have foreseen the requisite likelihood of damage to the other, the first question is answered “no”. If it is answered “no”, that is an end to the matter. No duty of care exists.

In this case, in my opinion, the first question can only be answered “yes”. The beneficiaries were named and the gift to them was specified in the will which the solicitor prepared and witnessed. It was clearly within his reasonable contemplation that carelessness by him resulting  [*105] in the failure of the gift to them would cause them damage. In saying this I am assuming that, in causing by his carelessness failure of the gift to them, he caused them damage. I discuss that later.

The word “proximity” is one which in this area of the law has been used in several distinct and different senses. It is used in the sense that there is proximity where one party ought reasonably to foresee that his carelessness may be likely to cause damage to the other person. This is the sense in which Lord Wilberforce uses it in the passage quoted. It is also used in the sense that there is proximity where in law one person owes a duty of care to the other. Another use of the word is in describing the position of persons who are close to each other or close to an event in terms of physical space or time. The word is apt to mislead. Whenever it is used it is important to have regard to the sense in which it is used.

Duty of care–second question The first question being answered, one goes to the next stage. “Secondly, if the first question is answered affirmatively, it is necessary to consider whether there are any considerations which ought to negative, or to reduce or limit the [*106] scope of the duty or the class of person to whom it is owed or the damage to which a breach of it may give rise …”: ([1978] AC), at p. 752; ([1977] 2 All ER), at p. 498. The approach of Lord Wilberforce may be regarded as having its origin in the judgment of Atkin, LJ in Everett v Griffiths, [1920] 3 KB 163. It is consistent with the approach of this Court in Pratt and Goldsmith v Pratt, [1975] VR 378 and of the High Court in Caltex Oil (Australia) Pty. Ltd. v The Dredge “Willemstad” (1976) 136 CLR 529 (“the Willemstad Case”). It was adopted in the High Court by the majority in The Council of the Shire of Wyong v Shirt (1980) 54 ALJR 283. See also: Dorset Yacht Co. Ltd. v Home Office, [1970] AC 1004, at pp. 1027 and 1054; (“the Dorset Yacht Case”); and L Shaddock and Associates Pty. Ltd. v Parramatta City Council, [1979] 1 NSWLR 566, at pp. 597-9. The approach of Lord Wilberforce was followed by Megarry, V-C in Ross v Caunters, [1980] 1 Ch 297, Burt, CJ in Watts v Public Trustee, [1980] WAR 97 and Anderson, J in the decision the subject of this appeal. It is an approach  [*107] which I regard as consistent with all the recent decisions of the House of Lords, the Privy Council and the High Court.

I accept the submission for the respondents that the approach stated by Lord Wilberforce is the approach which is to be applied in all cases to decide whether a duty of care is owed in the relationships within a particular category and, if so, what the criteria of liability ought to be. I reject the submission for the appellant that the approach is not of general application but is one to be applied only in cases of physical damage. Lord Wilberforce, at ([1978] AC) p. 751, describes the approach as having been reached through the trilogy of cases in the House of Lords: Donoghue v Stevenson, [1932] AC 562; Hedley Byrne and Co. Ltd. v Heller and Partners Ltd., [1964] AC 465; [1963] All ER 575 (“the Hedley Byrne Case”); and the Dorset Yacht Case, [1970] AC 1004; [1970] 2 All ER 294. The Hedley Byrne Case was not a case of physical damage but one of economic damage. After stating his second question the first example which Lord Wilberforce gave of its application was the Hedley Byrne Case. Where, through more than half a century of thought [*108] and experimentation, a fair and practical approach has been worked out, and where it has been clearly stated by a tribunal with the standing throughout the common law world of the House of Lords, in a way which accommodates all the modern leading cases, and which frankly acknowledges the policy component which has always been present, strong grounds are needed before the statement is to be treated as subject to unexpressed qualifications: cf. Samuels v Readers’ Digest Association Pty. Ltd. (1969) 120 CLR 1, at p. 31, per Kitto, J.

Categories Under the second question it is the method of the law to determine for particular categories of relationships whether the duty of care which arises prima facie on an affirmative answer to the first question, or the legal consequences of the existence of that duty of care, ought to be eliminated or restricted. One looks at categories of relationships, not, as under the first question, at the actual situation in the particular case. See: Hargrave v Goldman (1963) 110 CLR 40, at p. 65; the Hedley Byrne Case, [1964] AC 465, at pp. 524-5 and 531; Mutual Life and Citizens Assurance Company Ltd. v Evatt (1970) 122 CLR 628, at p. 632 [*109] (“the MLC Case”); the Willemstad Case (1976) 136 CLR 529, at pp. 565-7. The categories of relationships are not immutably fixed and new categories come into being. The Hedley Byrne Case [1964] AC, at pp. 524-5 and 531, per Lord Devlin. Criteria of liability In deciding, under the second question, whether there are any considerations which ought to negative, or to reduce or limit the scope of the duty or the class of person to whom it is owed or the damages to which a breach of it may give rise, one concentrates on the particular category of relationships.

When the law restricts the ambit of either a duty of care or the liability for its breach, it does so by reference to specific criteria suitable to that particular category: see the Hedley Byrne Case, [1964] AC 465, at p. 532; the Willemstad Case (1976) 136 CLR 529, at p. 576. Each category of relationships has its own set of criteria. In selecting and adopting criteria for a particular category the law fashions what Stephen, J has called a “control mechanism”: see the Willemstad Case (1976) 136 CLR 529, at pp. 572-6. Usually the control mechanism [*110] is designed to avoid the imposition of what is regarded as unreasonably extensive liability in damages. As between the categories, the criteria vary from those imposing slight control to those imposing extensive restrictions on liability. Where the plaintiff claims damages for physical injury to his person or property it may be enough that the injury was caused directly and its risk was reasonably foreseeable by the defendant. The Council of the Shire of Wyong v Shirt (1980) 54 ALJR 283; the Willemstad Case (1976) 136 CLR 529, at pp. 573-4. More complex sets of criteria exist, for example, in the categories of relationships where a plaintiff claims for: nervous shock (Pratt and Goldsmith v Pratt, [1975] VR 378); negligent misstatement (the MLC Case (1970) 122 CLR 628); negligence by a manufacturer (Donoghue v Stevenson, [1932] AC 562); or the common law negligence of a barrister (Saif Ali v Sydney Mitchell and Co., [1980] AC 198).

The relationship the subject of this appeal is in the category of relationships between solicitors and third parties intended by a client to receive a benefit under a document [*111] which the solicitor is retained to bring into existence. This is a case where the factual situation provides the material from which the criteria of liability may be fashioned. See: the Willemstad Case (1976) 136 CLR 529, at pp. 574-5. The criteria which suggest themselves as forming a natural boundary for the purpose of determining liability are these: the solicitor under contract with his client prepared a will leaving shares in an identified property to named beneficiaries but carelessly failed to ensure its proper execution; the client died still intending the gifts to be made to the beneficiaries but due to the improper execution of the will the gifts failed. There is advantage in concentrating judicial thought as far as possible on the precise issues on which the rights of the parties actually before the court depend. It is desirable to avoid stating the position too widely and to leave it to later cases to decide step by step whether the category or the criteria of liability should be widened. See: Donoghue v Stevenson, [1932] AC 562, at pp. 583-4; Grant v Australia Knitting Mills, [1936] AC 85, at pp. 107-8; the MLC Case (1968) 122 CLR 556, at pp. 596 and 615;  [*112] (1970) 122 CLR 628, at pp. 642-3 and 644; the Willemstad Case (1976) 136 CLR 529, at pp. 555 and 576.

Answering the second question The most important question in this case is whether there are considerations applicable to the category of relationships being considered, which ought to negative the duty which the answer to the first question shows prima facie to arise, or restrict its ambit or the consequences of its breach. If there are, by reference to what criteria should such restriction have effect? Then, does the present case fall within the boundary drawn by those criteria? The developing law of negligence In this area the dimension of the law extending back in legal history is as important as the dimensions revealed by the most recent decisions. The time at which a case was decided may be as important as what it decided. The decision in Donoghue v Stevenson, [1932] AC 562 may fairly be said to have opened the floodgates in this part of the law. However, as irrigation farmers know, the controlled progress of flooding is capable of very beneficial effects. By the criteria which they have applied to the various categories [*113] of relationships, the courts have controlled the progress of the law of negligence. See per Lord Denning, MR in Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, at p. 398. The progressive evolution of this part of the law is recognized by Lord Wilberforce in Anns’ Case, [1978] AC 728, at p. 751. [1977] 2 ALL ER 492, at p. 498. He said: “…the position has now been reached that in order to establish that a duty of care arises in a particular situation, it is not necessary to bring the facts of that situation within those of previous situations in which a duty of care has been held to exist.” He then stated the two questions which are to be asked and which I have already set out.

If the duty of care had been held in the various decisions of the last 50 years to apply only to situations in which it had previously been held to exist, the marked expansion in liability through evolution and development in this area of the law would not have occurred. I regard the approach set out by Lord Wilberforce as the appropriate approach at all judicial levels from trial judge to court of ultimate appeal. It is not only for courts [*114] of ultimate appeal that the approach is valid. The function of the Court of Appeal in England since 1932 could hardly be regarded as that of the passive recipient of new principles first fashioned by the House of Lords. See: Hargrave v Goldman (1963) 110 CLR 40, at pp. 64-5; Smith v Jenkins (1970) 119 CLR 397, at pp. 417-8; Dorset Yacht Case, [1970] AC 1004, at p. 1058.

Policy In deciding whether, in the category being considered, the prima facie duty of care ought to be negatived or the duty, or the consequences of its breach, restricted, a decision of policy is made. In Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, at p. 397 Lord Denning, MR said: “This case is entirely novel. Never before has a claim been made against a council or its surveyor for negligence in passing a house … It seems to me that it is a question of policy which we, as judges, have to decide. The time has come when, in cases of new import, we should decide them according to the reason of the thing.

“In previous times, when faced with a new problem, the judges have not openly asked themselves the question:  [*115] what is the best policy for the law to adopt? But the question has always been there in the background. It has been concealed behind such questions as: Was the defendant under any duty to the plaintiff? Was the relationship between them sufficiently proximate? Was the injury direct or indirect? Was it foreseeable, or not? Was it too remote and so forth. “Nowadays we direct ourselves to considerations of policy.” That attitude of Lord Denning has been reflected in most of the recent cases. It has been widely acknowledged that questions of policy are being decided. See: the Hedley Byrne Case, [1964] AC 465, at pp. 536-7; [1963] 2 All ER 575; the Dorset Yacht Case, [1970] AC 1004, at p. 1058; the Willemstad Case (1976) 136 CLR 529, at p. 574; Saif Ali v Sydney Mitchell and Co., [1980] AC 198.

In the Willemstad Case (1976) 136 CLR 529, at p. 575, Stephen, J, borrowing some words of Lord Pearce, said: “the gradual accumulation of decided cases and the impact of evolving policy considerations will reflect ‘the courts’ assessment of the demands of society for protection from the carelessness of others'”.  [*116]

The policy objective of the courts in deciding whether there should be liability within a particular category, and if so upon what criteria, is to attain a legal solution which will operate fairly, practically and sensibly. The Dorset Yacht Case, [1970] AC 1004, at pp. 1039 and 1054; the Willemstad Case (1976) 136 CLR 529, at pp. 551-2, 575 and 590-1. The courts look at decisions in analogous situations as indicating what there was regarded as fair, practical and sensible. See: the Hedley Byrne Case, [1964] AC 465, at p. 531. In the Dorset Yacht Case, [1970] AC 1004, at pp. 1058-64 Lord Diplock gives a comprehensive explanation of the way in which decisions in analogous situations are used: see also, at p. 1038, per Lord Morris. The courts also look at the various countervailing considerations which support particular solutions as being a fair, practical and sensible solution between parties in situations within the particular category of relationships being considered e.g. the Willemstad Case (1976) 136 CLR 529.

Decisions in analogous situations The appellant submits that the decisions, Ross v Caunters, [1980] 1 Ch 297; [*117] [1979] 3 All ER 580 and Watts v Public Trustee, [1980] WAR 97, which held that in situations indistinguishable from this case, the solicitor owed the beneficiary a duty of care, are wrong. As this appears to be the first consideration on an appeal, of the correctness of the principle applied in those decisions it is desirable to consider the issue afresh.

There are four main cases which I regard as quite closely analogous to the present case. In Everett v Griffiths, [1920] 3 KB 163 a doctor employed as the workhouse doctor by the guardians of a parish examined the plaintiff and gave a certificate under the Lunacy Act 1891 stating his opinion that the plaintiff was a person of unsound mind proper to be detained. Acting on the certificate and other material the chairman of the guardians signed an order for the detention of the plaintiff and he was detained. The plaintiff sued the doctor for damages for having negligently certified, thus causing him to be detained. The plaintiff failed in his action and appealed to the Court of Appeal. It was argued that the doctor owed the plaintiff no duty of care. That argument was accepted  [*118] only by Scrutton, LJ He emphasized that the only contract which the doctor had was his contract with the guardians; that under the contract the doctor was obliged to exercise reasonable care; and that the plaintiff was not a party to the contract and had not voluntarily submitted to the doctor. It followed that the doctor in certifying did not owe the plaintiff a duty of care: ([1920] 3 KB) pp. 194-7. Bankes, LJ rejected the argument. He said that although the doctor had not been retained or employed by the plaintiff he did not escape a duty of care. By undertaking the examination of the plaintiff he came under a duty ascertained by reference to the terms of the statute. He held that the doctor owed the plaintiff a duty to act with reasonable care: ([1920] 3 KB) pp. 181-4. However, in his opinion the appeal failed because there was no evidence fit to go to the jury that, in certifying, the doctor had failed to use reasonable care. Atkin, LJ held that the doctor owed a duty of care to the plaintiff. His approach was that in determining whether a duty of care was owed “… it is essential to consider the mutual relations of the parties in each particular case”: ([1920] 3 KB) p. 211.  [*119] He took the view that those exercising the power under the Act owed a duty of care to the individual in respect of whom they exercised those powers: ([1920] 3 KB) p. 212. A doctor knew that he was examining the person to determine whether he was to be confined and that his certificate was a condition precedent to the confinement: ([1920] 3 KB) p. 214. He recognized that although such a duty arose on general principles it could be limited or negatived by the provisions of the Act, by contract or by circumstances inconsistent with the existence of the duty: ([1920] 3 KB) pp. 212-6. He took the view that there was every reason for the existence of the duty where a doctor certified a man a lunatic for the purpose of his detention ([1920] 3 KB) p. 213. He indicated that a doctor was not bound to take part in the process of certification but if he did, he owed a duty of care: ([1920] 3 KB) p. 217 The similarity between the approach of Atkin, LJ and that of Lord Wilberforce in Anns’ Case, supra, is obvious. Atkin, LJ also supported his conclusion on the basis that by the doctor examining and conversing with the plaintiff a special relationship of doctor and patient was created: ([1920] 3  [*120] KB) p. 213. He took the view that although the Act did not create a duty of care one of the sections recognized its existence: ([1920] 3 KB) pp. 210 and 212. He considered that there was evidence fit to go to the jury and would have ordered a new trial. The plaintiff appealed to the House of Lords: [1921] 1 AC 631. All members of the House took the view that there was no evidence fit to go to the jury of lack of reasonable care in certifying. The duty owed by the doctor was therefore not argued on behalf of the respondent. Viscount Haldane, while expressing no opinion, said that he thought that probably if the matter were argued out the doctor would be found to be under a duty of care to the plaintiff, the precise nature of which would require consideration: ([1921] AC) p. 657. It is to be noted that in that case the doctor was not under a statutory duty to give a certificate: see [1920] 3 KB 163, at p. 194. The views that the doctor owed the plaintiff a duty of care in that case were in line with the direction of Crompton, J. to the jury in Hall v Semple (1862) 3 F and F 337; 176 ER 151.

In Ministry of Housing v Sharp, [1970] 2 QB 223; [*121] [1970] 1 All ER 1009, the Ministry had a registered charge over a piece of land for repayment to it of a sum of money. A proposed purchaser applied to the Hertfordshire County Council for an official search to be made in the register. A clerk in the council’s office made a search but overlooked the charge and an official certificate issued which did not mention the charge. The proposed purchaser, believing the land free of any charge, purchased it. Later the purchaser refused to pay the amount of the charge to the Ministry, relying on a section which was to the effect that a certificate that there was no charge was conclusive in favour of a purchaser against the person entitled to the charge. The Ministry sued the council, which conceded liability if the clerk was liable. Lord Denning, MR rejected the submission that a duty of care arose only where there was a voluntary assumption of responsibility. He held that the duty to use care in a statement arose from the fact that the person making it knew or ought to know that others, being his neighbours in this regard, would act on the faith of the statement being accurate. That duty was owed to the person to  [*122] whom the certificate was issued and was also owed to any person, such as an incumbrancer, who he knew or ought to know would be injuriously affected by a mistake. He held the council liable to the ministry for breach of a common law duty to use due care: ([1970] 2 QB) pp. 268-9. Salmon, LJ said that the clerk and the council must or should have known that unless the search was conducted and the certificate was prepared with reasonable care any chargee or incumbrancer whose charge was carelessly omitted from the certificate would lose it and be likely to suffer damage. He regarded this factor as creating a sufficiently close degree of proximity between the council and the incumbrancer. He took the view that what was to be foreseen as a result of the clerk’s failure to take reasonable care was financial loss not physical injury, but that the existence of a duty of care no longer depended on whether the damage was physical injury or financial loss. He added that the case did not precisely fit into any category of negligence yet considered by the courts. He did not accept that in all cases the obligation to take reasonable care necessarily depends on a voluntary assumption of responsibility.  [*123] It seemed to him that the council had there undertaken the duty of searching the register and preparing the certificate. He said that he did not think that it mattered that this was done at the request of the purchaser. He concluded that the damage to the incumbrancer was foreseeable and the proximity sufficiently close for the council through its clerk to owe the Ministry a duty of care: ([1970] 2 QB) pp. 277-80. Cross, LJ said that he did not think the fact that the clerk did not undertake the function of making the statement voluntarily, except in the sense that he could have refused to accept the employment, was relevant to the problem. He said that he saw no reason why, in an appropriate case, a duty of care should not extend to cases in which the defendant was obliged to make the statement which proved false. He expressed great doubt as to the liability of the council but was not prepared to dissent from the other two members of the Court: ([1970] 2 QB) pp. 290-1. The remaining two cases deal with the liability of councils in exercising statutory authority over building operations. In Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, [*124] the Court of Appeal held a council liable to the owner of a house damaged by subsidence, for the negligence of its building inspector in inspecting and approving the foundations of the house. The result was approved and the reasons justifying the decision were stated by the House of Lords in Anns’ Case, [1978] AC 728; [1977] 2 All ER 492, to which I now go. In Anns’ Case a council had power to inspect the foundations of a two-storey block of maisonettes and to insist on any corrections necessary to bring the work into conformity with the by-laws. A by-law provided that the foundations of a building were to be such, and of such depth, as to safeguard the building against damage by swelling or sinking of the subsoil. The council approved building plans showing foundations of three feet or deeper, to the approval of the local authority. On completion of the block in 1962 the owner, who was also the builder, granted leases of the maisonettes for 999 years. In 1970 there were structural movements which resulted in cracks in the walls, sloping floors and other defects. Two original lessees and two assignees of original leases sued the council for negligence by [*125] its employees in approving foundations only two feet six inches in depth. On a preliminary issue it was held that each plaintiff’s cause of action accrued on the date of the first lease of the maisonette in question and so all were statute barred. The Court of Appeal allowed an appeal. The council appealed to the House of Lords and obtained leave to argue the question whether it was under a duty of care to the plaintiffs at all. Lords Diplock, Simon and Russell agreed with the reasons of Lord Wilberforce. Lord Salmon gave his own reasons. Being a preliminary point of law, the questions had to be decided on the assumption that the facts were as pleaded. It was not established whether the council made any inspection of the foundations. The House of Lords considered the issues whether the council was under: (a) any duty of care to the plaintiffs to carry out an inspection of the foundations; (b) a duty, if any inspection was made, to take reasonable care to see that the by-laws were complied with.

The first question for determining the existence of a duty of care, which earlier in my reasons I quoted from Lord Wilberforce’s reasons, was answered in the affirmative. Lord Wilberforce [*126] said that it must be in the reasonable contemplation of the local authority that failure to comply with the by-law’s requirement as to foundations may give rise to a hidden defect which in the future may cause damage to the building. As the building was intended to last, he said, the class of owners and occupiers likely to be affected could not be limited to those who went in immediately after construction: ([1978] AC) p. 753.

In considering the second question for the determination of the existence of a duty of care, Lord Wilberforce first turned his attention to the position if no inspection had been carried out. He held that the council had a power but not a duty to inspect. He outlined the principles applicable to decide whether liability flowed from non-inspection. The part of the decision is not of importance in this case. He held that if an inspection was made there was a duty to exercise reasonable care. He said that the standard of care must be related to the duty to be performed, namely to ensure compliance with the by-law. It must be related to the fact that the inspector’s function was supervisory; and to the fact that the inspector had a discretion as to the time and [*127] manner of inspection and the techniques to be used. He added at ([1978] AC) p. 755; ([1977] 2 All ER p. 501: “A plaintiff complaining of negligence must prove, the burden being on him, that action taken was not within the limits of a discretion bona fide exercised, before he can begin to rely on a common law duty of care. But if he can do this, he should, in principle, be able to sue.”

He then asked whether there was authority against the existence of that duty of care or any reason to restrict it: ([1978] AC) p. 755; ([1977] 2 All ER) p. 501. His answer to both these questions was in the negative.

Lord Wilberforce referred to the argument that with a statutory power, as distinct from a statutory duty, no liability could arise unless some positive act in exercise of the power caused damage. He rejected that as an absolute rule and expressed the view that parallel with public law duties towards individuals affected by the exercise of statutory duties or powers: “…there may coexist those duties which persons private or public, are under at common law to avoid causing damage to others in sufficient proximity to them”: ([1978] AC) p.756; ([1977] 2 All [*128] ER) p.502. As a reasonable man in the position of the inspector must have realized that if the foundations were covered in without adequate depth or strength as required by the by-laws, injuries to safety or health might be suffered by owners or occupiers of the building. Lord Wilberforce decided that the duty of care was owed to them. The right of action was given only to the person who was owner or occupier when the damage occured. He added that that disposed of the objection that an endless indeterminate class of potential plaintiffs may be called into existence : ([1978] AC)p. 758; ([1977] 2 All ER) p. 504.

Lord Wilberforce said that the duty was to take reasonable care,no more, no less, to secure that the builder did not cover in foundations which did not comply with by-law requirements: ([1978] AC) p.758; ([1977] 2 All ER) p. 504.

He held that the damages to be recovered were such amount in respect of physical damage to the dwelling as would restore it to a state where it would no longer be a danger to the health or safety of its occupants: ([1978] AC) pp. 759-60; ([1977] 2 All ER) p. 505.

The cause of action was held to arise only when the building was in a state [*129] where there was present or imminent danger to the health or safety of its occupants: ([1978] AC) p. 760; ([1977] 2 All ER) p. 505.

The reasons of Lord Salmon on the issues relevant to the present case to a similar effect.

These cases which I consider to be closely analogous to the present case, are of course not directly in point. It would be unnecessary to reason by analogy if they were. In each of them the doctor, clerk or building inspector was exercising a power under a statute and this, and the statutory structure within which the act was done, were borne in mind. These considerations were relevant to the nature of the duty of care. Anns’ Case is a good illustration of that. However, in each case it was the duty of care at common law which the Court held to exist. In each case, although the doctor, clerk or building inspector exercised the power because he was bound by contract to his employer to do so, he was held to owe a duty of care to the plaintiff with whom he had no contract and, in all but one of the cases, no contact. In none of the cases had the plaintiff in any positive practical sense relied on what was done by the doctor, clerk or building inspector. In none [*130] of the cases had the plaintiff requested that the relevant act be done. In none of the cases, leaving aside Everett v Griffiths, could it be said that the clerk or building inspector in any way held himself out to the plaintiff as accepting responsibility to the plaintiff for what he did. In all cases, however, the doctor, clerk or building inspector had done the act complained of, where it was within his reasonable contemplation that if it was done carelessly it might cause damage to a person in the position of the plaintiff. See: the Willemstad Case (1976) 136 CLR 529, at p. 590. These cases tend to indicate that if it was fair, practical and sensible that in their situations the doctor, clerk or building inspector should owe a duty of care to the persons in the positions of the plaintiffs, it would also be fair, practical and sensible in a case such as the present, that the solicitor should owe a duty of care to the beneficiaries. Policy considerations I turn to the considerations which tell in favour of the existence of a duty of care owed by the solicitor to the beneficiaries.

In the first place the beneficiaries, whether or not they have in law [*131] suffered loss, have certainly in the colloquial sense “lost out” on a gift the client intended for them, as a result of the solicitor’s carelessness. If there is a proper legal basis for holding that they have sustained damage due to the breach of a duty of care, there is great force in the words of Lord Salmon: “It seems to me to be manifestly fair that any damage caused by negligence should be borne by those responsible for the negligence rather than by the innocents who suffer from it.” Anns’ Case, [1978] AC 728, at p. 767. See also Saif Ali v Sydney Mitchell and Co., [1980] AC 198, at p. 214.

It is desirable that the law and its institutions and practitioners should carry into effect the objects which citizens have sought to achieve by a proper use of the law. The client engaged, and presumably paid, a practising solicitor to prepare a will to make the gifts to the beneficiaries. The proper expectations of the client do not lose weight upon his death. His expectations have not been achieved, through carelessness, in breach of contract, by the solicitor. An action on behalf of the client’s estate could recover only nominal damages. It seems just that there be an award of damages [*132] which would in a substantial way achieve the client’s intention and expectation and compensate the disappointed beneficiaries.

A duty of care owed by a solicitor to beneficiaries in these circumstances, as Megarry, V-C said: “… far from diluting the solicitor’s duty to his client, marches with it, and, if anything, strengthens it”: Ross v Caunters, [1980] 1 Ch 297, at p. 322; [1979] 3 All ER 580, at p. 599. Within the criteria which are present in this case, I do not see any prospect of conflict between the solicitor’s duty to his client and his duty to the beneficiaries. If there is a duty of care to the beneficiaries, the duty to the client will in fact be buttressed by the solicitor knowing that if he is negligent in preparing or supervising the execution of the will, he will face an action for damages by the beneficiaries instead of a theoretical action for nominal damages on behalf of the client’s estate.

A number of considerations have been advanced to show that it would neither be fair, practical nor sensible for the solicitor to owe the beneficiaries a duty of care.

A duty of care would involve a solicitor in [*133] a liability to beneficiaries which solicitors have not previously had to bear. Solicitors, however, are no strangers to liability for negligence. They have always been liable for negligence to their clients, whether the liability has sounded in contract or tort. It is only because of the peculiar situation of a will that solicitors have in practice been liability free when careless in preparing wills or supervising their execution. Liability to clients has not discouraged solicitors from doing work with care and skill which would involve them in liability for large amounts if done negligently. The comment of one of the architects of the modern law of negligence is apposite. In Everett v Griffiths, [1920] 3 KB 163, at pp. 222-3 Atkin, LJ said: “We were pressed very much by counsel for the defendants by the injury which public interests would suffer if there was an enforceable obligation upon persons acting under the Lunacy Acts to act with a reasonable care. It was said that henceforward it would become impossible to induce persons to act. I am not much impressed by the argument. I doubt whether any person, taking upon himself the painful responsibilities [*134] imposed by the Lunacy Acts, was ever encouraged to act by the consideration that he could be negligent with impunity, or will be deterred from acting by the consideration that if he is negligent he will have to pay damages. It is not by such motive that public or professional men in this country are swayed.” It is relevant to consider the economic consequences upon solicitors generally if a duty of care is owed in a case like this. It was submitted that the extent of potential liability may be difficult to ascertain or quantity at the time the will is made. Thus a solicitor invalidly making a will leaving to a beneficiary the whole of the estate of a client with few assets, may find that the client has become very wealthy by the time of death. It is also put that a solicitor who prepares a will for a client and has it properly executed could incur a great liability if a gift failed through the operation of some obscure rule of law. It is argued that, if a solicitor is liable to a disappointed beneficiary, he would also be liable to a disappointed donee under a deed of gift.

In my opinion it is important to distinguish between a principle which would make a solicitor liable for [*135] carelessness causing damage and a principle which would impose on him an unlimited and indeterminate liability for the carelessness. It is not usual for the modern law of negligence to allow a careless professional person immunity from liability where he ought reasonably to have seen that his carelessness would cause damage to another person: Cf. Saif Ali v Sydney Mitchell and Co., [1980] AC 198, at pp. 218-9. Lord Salmon, at p. 231, took a wide view of the liability of a professional person settling a document: “The normal rule applied by the law is that, if anyone holding himself out as possessing reasonable competence in his avocation undertakes to advise or settle a document, he owes a duty to advise or settle the document with reasonable competence and care. This duty is owed to anyone he should foresee may suffer loss if the duty is breached.”

Occasionally for policy reasons a person is treated as under no liability to a particular person he knows will suffer damage from his carelessness e.g., Rondel v Worsley, [1969] 1 AC 191. The courts, however, often apply criteria of liability to limit the liability of a professional or skilled person who does owe a duty of care to a [*136] plaintiff e.g., Anns’ Case, [1978] AC 728; [1977] 2 All ER 492.

In considering the economic consequences upon solicitors generally two things are important. First, it would only be where there was negligence that there would be any liability. Second, the courts are well able to limit liability if the view is taken in later cases that it would not be fair, practical and sensible to impose liability, or impose unrestricted liability, beyond the boundaries drawn by the criteria which are present in this case.

In the Willemstad Case (1976) 136 CLR 529, at pp. 580-1 Stephen, J. in deciding that a tortious duty of care should exist, declined to take into account the views which legal writers have advanced that it is desirable that losses be spread by the law letting them lie where they fall and letting loss insurance spread them. He regarded it as inappropriate for a court to take that philosophy into account, as to act on it would be to depart from the existing goals of the law of torts. However, in deciding whether it is fair, practical and sensible that one party in a particular category of relationships should be liable for [*137] his carelessness to the other, an inquiry whether one or other or both are likely to be covered by insurance, is an inquiry for quite a different purpose. The law does pay regard to the likely presence of insurance in deciding where fairness lies as between classes of persons in the bearing of a loss. See for example: Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, at p. 398; Photo Production Ltd. v Securicor Transport Ltd., [1980] AC 827. A solicitor carrying on a practice is likely to have liability to beneficiaries covered by insurance, as well as liability to clients, if he may be made liable to beneficiaries for negligence. It is difficult to contemplate that a beneficiary in ordinary circumstances, would ever be covered by insurance for such a loss. Of course, the additional insurance cover would involve further expense for solicitors. This aspect is mentioned by JF Keller, in: “Paying for Mistakes–Professional Negligence and Economic Loss” (1979) 53 ALJ 412.

It was put that, while a solicitor may by contract with his client exclude liability for negligence, he could not, in practice, do this in respect of liability to a beneficiary.  [*138] That is a common situation with the law of negligence. The repairer of a motor car may by contract exclude himself from liability if his negligent repairs cause a wheel to come off and the car owner to be injured. But he can not, in practice, exclude himself from liability to another road user who is hit by the wheel when it comes off.

It was argued for the appellant that the rejection of this appeal would involve the imposition on solicitors of liabilities that were incongruous or against public policy. The example was given of a solicitor who agreed with his client to make a will leaving property to a named beneficiary, but carelessly failed to do so before the client died. The argument was that the solicitor would in effect be liable for breach of contract to the beneficiary with whom he had no contract. I doubt whether that would follow. The law of tort has often drawn a distinction between a person agreeing gratuitously to do something and carelessly failing altogether to do it, who has been held not liable, and a person in the same position who did the thing negligently and was held liable: see the Hedley Byrne Case, [1964] AC 465, at pp. 526-7. It was also submitted that [*139] a solicitor acting for a client in connection with a contract conferring a benefit on the other party, could find himself in a situation of conflict, with duties owed both to his client and the other party. The position of the solicitor there may be similar to that of the insurance doctor mentioned by Atkin, LJ in Everett v Griffiths, [1920] 3 KB 163, at p. 213. However, liability in these situations and others mentioned in argument is not concluded by this appeal and will be decided if and when the questions arise.

For reasons which I mention later, I do not consider that in this category of case the fact that the claim is for financial loss tells against the existence of a duty of care.

The cases and considerations which I have discussed do not lead me to the conclusion that the prima facie duty of care, which I regard as arising in this case on the application of Lord Wilberforce’s first question, should be negatived. Nor do I consider that further criteria of liability than those which arise naturally in this case should be imposed to restrict that duty of care or the legal consequences of its breach.

Other submissions Having decided, on the [*140] approach approved by the House of Lords in Anns’ Case, [1978] AC 728; [1977] 2 All ER 492 that (subject to the question of damage) the solicitor in this case owed the beneficiaries a duty of care to ensure that the client’s will was properly executed, I consider some submissions that, as a matter of law, that conclusion is not open in this case. It was argued that to hold that the solicitor owed a duty of care in this case would be to create a tortious duty which was, in effect, derived from the contract between solicitor and client. It was put that this was tantamount to enforcing at the suit of a third party a right purported to be given to him by a contract to which he was not a party. There was argument before us as to whether a solicitor owes his client a duty in contract only, or also in tort. Although I think that there is a great deal to be said for the view that a solicitor is now liable to his client in tort as well as contract, I do not stay to consider the question. I regard the issue as tending to distract from the proper inquiry. The duty of care to the beneficiary does not grow from the contract between solicitor and client. It grows prima [*141] facie from the fact that the solicitor undertook (in the sense of doing) the preparation and supervision of the execution of the will in circumstances in which it was within his reasonable contemplation that carelessness on his part would be likely to cause “damage” to the beneficiaries. That prima facie duty survives, if it is not negatived or restricted by the policy considerations which I have mentioned. The law has long passed the stage where the liability in negligence of a contracting party to someone not a party to the contract is regarded as a product of the contract. In the words of Lord Morris, in the Dorset Yacht Case, [1970] AC 1004, at p. 1036, the beneficiaries: “sue in their own right and not (to use a phrase of Cardozo, J in Palsgraf v Long Island Ry. (1928) 248 NY 339) ‘as the vicarious beneficiary of a breach of duty to another’.”

See also: Donoghue v Stevenson, [1932] AC 562, at pp. 609-12; Grant v Australian Knitting Mills Ltd. (1935) 54 CLR 49, at p. 66.

The relevance of the contract in this case is made clear by a passage in the judgment of Windeyer, J in Voli v Inglewood Shire Council (1963) 110 CLR 74, at p. 85,  [*142] a case drawn to my attention by Murphy, J. Windeyer, J. said: “…neither the terms of the architect’s engagement, nor the terms of the building contract, can operate to discharge the architect from a duty of care to persons who are strangers to those contracts. Nor can they directly determine what he must do to satisfy his duty to such persons. That duty is cast upon him by law, not because he made a contract, but because he entered upon the work. Nevertheless his contract with the building owner is not an irrelevant circumstance. It determines what was the task upon which he entered. If, for example, it was to design a stage to bear only some specified weight, he would not be liable for the consequences of someone thereafter negligently permitting a greater weight to be put upon it.”

It was put that it is established by the Hedley Byrne Case, [1964] AC 465 and the MLC Case (1968) 122 CLR 556 that a duty of care such as is contended for in this case could only arise if there had been reliance by the beneficiaries on the solicitor. The answer to that was given by Lord Salmon to the similar argument in Anns’ Case. He said that reliance was important in [*143] some categories of case such as the category including the Hedley Byrne Case where the loss was caused by reliance on the negligent misstatement. He added, at ([1978] AC) p. 769: “In the present case, however, the loss is caused not by any reliance placed by the plaintiffs on the council or the building inspector but by the fact that if the inspection had been carefully made, the defects in the foundations would have been rectified before the erection of the building was begun. The categories of negligence as Lord Macmillan said, are never closed and there are now a great many of them. In a few, ‘reliance’ is of importance. In the present case reliance is not even remotely relevant.” There is a similar answer to the submissions that in the present category of case it should be a necessary criterion of liability that there be present one or more of the criteria which have sometimes been said to be necessary in other categories of cases, such as a “holding out” by the defendant to the plaintiff that he possessed particular skills or that he accepted responsibility to the plaintiff for what he was doing.

I do not regard as helpful the argument that no duty of care can exist unless [*144] there is a “special relationship” between the parties. That expression is commonly used to refer to any relationship in which a duty of care exists.

It was argued for the appellant that all the cases in which a person doing an act under contract has been held to owe a duty of care to a third party, are cases where the other party to the contract would have been liable to the third party if he had done the act himself. It was put that these cases suggested that, as the client’s estate would not be liable to the beneficiaries if the client himself had carelessly made the will which failed through improper execution, the solicitor could not be liable either. I do not think that all the cases fit the appellant’s submission. In Everett v Griffiths, [1920] 3 KB 163 the act had to be done by a qualified doctor and the guardians who employed the doctor were unlikely to be so qualified. In view of the Hedley Byrne Case, [1964] AC 465 and the MLC Case (1970) 122 CLR 628, while the accountants, being persons of skill and competence in the field of accounts, would now be liable in the circumstances of Candler v Crane, Christmas and Co., [1951] 2 KB 164, [*145] the tin mining company would not have been liable if it had prepared the accounts. In any event this does not seem to me to be a factor essential to the existence of a duty of care. In many cases, at least, it is enough to look at the relationship between the plaintiff and the defendant. The duty to the plaintiff of the other party to the defendant’s contract may or may not cast light on the duty owed by the defendant to the plaintiff.

It was submitted that the Court is bound by a decision of the House of Lords in a Scottish appeal, Robertson v Fleming (1861) 4 Macq 167, to hold that no duty of care arose in this case. I will consider that submission later.

Have the plaintiffs suffered damage? It was argued for the appellant that the beneficiaries in this case suffered no damage in any sense accepted by the law. In essence the argument is that as the beneficiaries never had any interest in the house property it can not be said that they have lost anything. This amounts to a submission on behalf of the solicitor that although the beneficiaries would have had their interests in the property if he had had the will properly executed, as he did not do so,  [*146] they have in law suffered no loss.

In my opinion the cases in which damages have been awarded for the loss of the chance of a benefit show that the loss of what Megarry, V-C called “an assured benefit” (Ross v Caunters, [1980] 1 Ch 297, at p. 321; [1979] 3 All ER 508, at p. 598) is a form of damage recognized by the law. These cases are inconsistent with the proposition assumed by Stamp, LJ in Dutton v Bognor Regis Urban District Council, [1972] 1 QB 373, at p. 413. In Otter v Church, Adams, Tatham and Co., [1953] Ch 280 Michael Otter, the tenant in tail of settled land, who could have become absolutely entitled to it by executing a disentailing deed, received negligent advice from his solicitor that he was absolutely entitled to it. He died having never been advised of the true position and the property passed to his uncle. His administratrix sued the solicitor for damages. It was argued for the solicitor that only nominal damages, the damages which Michael could have recovered in his lifetime, could be awarded. In rejecting that submission Upjohn, J. said, at ([1953] Ch) p. 289: “It is contrary [*147] to common sense to suppose that the damages must only be nominal merely because, had the mistake been discovered in the lifetime of Michael, it could have been rectified. The true way of looking at it, in my judgment, is this. If the mistake had been discovered in Michael’s lifetime it would have been his duty to mitigate the damages, i.e., to reduce them to a nominal sum by executing a disentailing deed, but, as the mistake was not discovered until after his death, Michael has been deprived of the opportunity of increasing his estate by executing a disentailing deed, and, therefore, on his death, his estate is diminished by that amount.”

The estate was awarded damages for loss of the opportunity.

Another example is the decision of the trial Judge, Ashworth, J, in Hall v Meyrick, [1957] 2 QB 455. His judgment was set aside by the court of Appeal on the ground that the cause of action on which the plaintiff succeeded had been introduced by amendment at a time when it was statute barred: [1957] 2 QB 455, at p. 472. The members of the Court of Appeal expressed reservations as to whether there had been a breach by the solicitor [*148] of his duty of care but no reservation was expressed as to the damages which had been awarded. The plaintiff, a widow, and a Mr Hall visited a solicitor together and each separately retained him to prepare a will leaving property to the other. Discussion during the visit indicated there was a real possibility they would marry. Negligently, the solicitor failed to advise the plaintiff that marriage would revoke the wills. They married and Hall later died. On his intestacy the plaintiff received less than half of what she would have received under his will. Ashworth, J held that in failing properly to advise the plaintiff, the solicitor caused her to lose the chance or opportunity of obtaining under a new will from Hall what he had provided for her in the revoked will. Damages, making allowances for various contingencies, were awarded on that basis.

Those cases were cases where the wrong advice or failure to advise deprived the solicitor’s client of the chance or opportunity of taking steps to obtain an accretion to the client’s estate, to which in the absence of those steps the client was not entitled. The present case is not to be treated as a case where the solicitor’s want of [*149] care deprived the plaintiffs of merely a chance or opportunity of an accretion to their estates. That would have been their position during the client’s life. It is, however, proper to take into account that the client died with his will unrevoked. Compare: Willis v The Commonwealth (1946) 73 CLR 105. The beneficiaries lost, what, but for the want of care of the solicitor, was the certainty of receiving, as an accretion to their estates, the interests directed to them by the will. In this case, the issue does not appear to have been raised at the trial that there was any risk that if the will had been valid, the interests of these beneficiaries would have been extinguished or diminished by an order for family provision under PtIV of the Administration and Probate Act 1958. Although the cases just discussed concerned damages for breach of contract, the same principles in my opinion apply in cases of damages for tort: cf. London and North Eastern Railway Co. v BA Collieries Ltd., [1945] AC 143, at pp. 185-6, per Lord Wright; Luntz, Assessment of Damages for Personal Injury and Death, paras. 5.207 and 6.426. In Domine v Grimsdall, [1937] 2 All ER 119, [*150] a bailiff’s assistant, under execution issued by a judgment creditor, seized furniture worth more than the judgment debt. In breach of his statutory duty he left the furniture with the judgment debtor and both the furniture and the judgment debtor disappeared. Atkinson, J. held the bailiff liable to the judgment creditor for breach of statutory duty and held that the loss of a chance sounds in damages in tort as well as contract. He considered that if the furniture had been removed and stored as it should have been, there was a real prospect that something would have been paid towards the debt. The judgment creditor was awarded damages for loss of the chance.

The cases of Hall v Meyrick, Otter v Church, Adams, Tatham and Co. and Domine v Grimsdall, supra, are discussed in McGregor on Damages, 14th ed., paras. 275-7 and 969. The principle of the first two was applied by Roper, J in Murray v Bannerman, Brydone, Folster and Co., [1970] NZLR 1034.

It was argued that this action did not lie, because the damages claimed were for financial loss. Consistently with the approach outlined by Lord Wilberforce in Anns’ Case, [1978] AC 728; [1979] 3 All ER 580 it [*151] would be open to the law to hold that within the category of case now being considered, damage of the type suffered by the respondents here should not give rise to liability. Cases discussed in the Willemstad Case (1976) 136 CLR 529 illustrate that in some categories of cases the law has adopted the policy that a person who suffers no injury to person or property should not be entitled to recover for financial loss due to the defendant’s want of care. I consider that such an approach would be inappropriate in the category being considered here. It would in practice negate the right of disappointed beneficiaries to sue a solicitor for breach of the duty of care which I consider is imposed by the general principles of negligence. In the Hedley Byrne Case, [1964] AC 465, at p. 509; [1963] 2 All ER 575, at p. 598 Lord Hodgson said: “It is difficult to see why liability as such should depend on the nature of the damage.”

It is open to the law to hold that loss such as that suffered by the respondents should sound in damages. As Salmon, LJ said in Ministry of Housing v Sharp, [1970] 2 QB 223, at p. 278;  [*152] [1970] 1 All ER 1009, at p. 1027: “So far, however as the law of negligence relating to civil actions is concerned, the existence of a duty to take reasonable care no longer depends on whether it is physical injury or financial loss which can reasonably be foreseen as a result of a failure to take such care.”

The change in the law brought about by the Hedley Byrne Case, [1964] AC 465; [1963] 2 All ER 575 was one which enabled plaintiffs in the category of cases based on negligent misstatement to recover damages for financial loss.

I have thus reached the position where, leaving aside the effect of the decision of the House of Lords in Robertson v Fleming (1861) 4 Macq 167, I am in respectful agreement with the decision of Megarry, V-C in Ross v Caunters, [1980] 1 Ch 297 and its application by Burt, CJ and Anderson, J. Robertson v Fleming In Robertson v Fleming (1861) 4 Macq 167 the respondents, as sureties, guaranteed repayment by one Hamilton to an assurance company of money he had borrowed. Hamilton agreed to give the respondents security  [*153] over certain leasehold property of his. Hamilton employed the appellant, a solicitor, to prepare and complete the security document. The security document was prepared but was not completed by notice of it being given to the landlord. Hamilton absconded and was made bankrupt and the respondents had to pay a sum of money to the assurance company. As the respondents could not enforce their security they sued the appellant, claiming damages for his negligence in failing to complete the security. The appellant’s defence was that he had not been employed by the respondents and had not acted as their solicitor at all. The Court of Session directed that two issues be determined by the jury at the trial: (1) Whether the appellant was employed by Hamilton to prepare and complete the security document “for behoof of” the respondents; (2) Whether by negligence the appellant failed to prepare and complete the security document to the damage of the respondents. The jury returned a verdict for the respondents, awarding damages equal to the amount paid to the assurance company.

The appellant eventually appealed to the House of Lords where the main question was whether the proper question of fact [*154] had been raised by the first of the above issues. A great deal turned on whether under Scottish law the words “for behoof of” meant “for the benefit of” or meant “by the authority of”. The House of Lords, with one dissentient, Lord Campbell, LC, held that the words meant “for the benefit of”. On that basis it was held that the first of the issues had not raised the proper question of fact. The proper question of fact was whether the appellant had been employed by or by the authority of the respondents. The case was remitted to the Court of Session to be determined upon the proper issues.

The essence of the reasoning in the House of Lords was that if Hamilton had employed the appellant to prepare and complete the security document for the benefit of the respondents and he had negligently failed to do so, the respondents had no cause of action against him for damages. However, if Hamilton had employed the appellant on behalf of the respondents or on behalf of Hamilton and the respondents, the respondents would have a cause of action in contract against the appellant.

I take the prevailing view of the ratio decidendi of the case to be that expressed by Sir Rupert Cross: “The ratio [*155] decidendi of a case is any rule of law expressly or impliedly treated by the judge as a necessary step in reaching his conclusion, having regard to the line of reasoning adopted by him…”: Precedent in English Law, 3rd ed., 1977, p. 76. As was said by A.G. Lang in “Is There a Ratio Decidendi?” (1974) 48 ALJ 146, at p. 151: “….the determination of facts must not be lost sight of, as the judge’s remarks should be read secundum subjectam materiam, and having regard to the issues as raised by the parties and determined by him. However, if the judge enunciated and relied upon a wide principle, this need not be artificially narrowed down to fit into the specific findings of fact and be confined within its strict limits.”

See also: Saif Ali v Sydney Mitchell and Co., [1980] AC 198, at p. 217, per Lord Diplock.

In my opinion it was part of the ratio decidendi of the decision of the House of Lords that a solicitor engaged by a client to effect a transaction which will obviously benefit a third party is not liable to the third party in damages,if, through the solicitor’s lack of care, the transaction does not confer that benefit on the third party: cf. Cordery on Solicitors, 6th ed.,  [*156] 1968, pp. 189 and 199. In my view it is not possible to treat the decision as a decision on Scottish law only. Their Lordships proceeded on the basis that the relevant English law was the same. It was as much a decision on the common law as was Donoghue v Stevenson, [1932] AC 562: see the Dorset Yacht Case, [1970] AC 1004, at p. 1028. While it could be said that Robertson v Fleming dealt with a transaction involving a conflict of interest between Hamilton and the respondents, in which the appellant’s duty was owed only to Hamilton, the principle was never stated as being confined to transactions involving a conflict of interest between the solicitor’s client and the third party. Compare the views expressed by Lords Reid and Hodgson in the Hedley Byrne Case, [1964] AC 465, at pp. 487-9 and 507-9 that although distinguishable on the facts the ratio decidendi of Le Lievre v Gould, [1893] 1 QB 491 was binding in Candler v Crane, Christmas and Co., [1951] 2 KB 164. Lord Campbell, LC, at p. 177, Lord Cranworth, at pp. 184-5, and Lord Wensleydale, at pp. 199-201, stated the principle in terms which included within it absence of liability [*157] to a disappointed legatee. The other member of the House, Lord Chelmsford, while not referring to the situation of a disappointed legatee, took a similar view as to the breadth of the principle: see pp. 207-11. I consider that the principle was a general and indivisible one which the Lords treated as a necessary logical step in reaching their conclusion. It is necessary to consider the consequences of my conclusion that part of the ratio decidendi of the decision of the House of Lords in 1861 conflicts with what I regard as the proper application to the category of relationships relevant in this case, of the general principles of the modern law of negligence. I earlier indicated my view that the approach stated by Lord Wilberforce in Anns’ Case was to be followed at all judicial levels from trial judge to court of ultimate appeal. The approach is available only where there is no authority which it is proper to follow, and which decides whether or not a duty of care exists in the relationships in the category in question: see Anns’ Case, [1978] AC 728, at p. 755. In this case there is the decision of the House of Lords in 1861 to the effect that no liability for negligence exists [*158] in the relationships in the category now being considered. It is an old case based on a view of the law which I consider to be outmoded since Donoghue v Stevenson, [1932] AC 562 and since Candler v Crane, Christmas and Co., supra, was overruled in the Hedley Byrne Case. Robertson v Fleming has, however, not been overruled by the House of Lords. There is no decision or observation of the House of Lords, the Privy Council or the High Court which is inconsistent with its application in the present category of case. In my opinion the effect of decisions of this Court is that the decision in Robertson v Fleming should now be applied in this Court: see Brisbane v Cross, [1978] VR 49; R v O’Connor, [1980] VR 635. I take that view although I do not regard Robertson v Fleming as being in accord with the general principles of the modern law of negligence and although I regard it as a decision likely to be departed from by the House of Lords and the High Court.

Conclusion It follows that in my opinion the appeal should be allowed and the order proposed by Lush, J should be made. I agree with what is said by Lush, J about the measure of damages.

ORDER:

Appeal allowed.

[*159]
Solicitors for the appellant: Moule,Hamilton and Derham.
Solicitors for the respondents: Kiernan and Forrest.

REPORTER: CATHRYN MCMILLAN

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