A contractor negligently cuts an electricity cable, shutting down a factory. The factory owner claims for lost profit during the outage, but his own property was undamaged. What is the likely result (Spartan Steel)?
Answer and explanation
Correct answer: C. Recovery is limited to loss consequent on physical damage, and pure economic loss is not recoverable
- Step 1: The general rule excludes pure economic loss in negligence.
- Step 2: Loss flowing from physical damage to the claimant's property can be recovered, but other economic loss cannot.
Answer
Recovery is limited to loss consequent on physical damage, and pure economic loss is not recoverable.
Why not the others: Pure economic loss is not recoverable; the identity of the defendant is irrelevant; duration does not alter the rule.
Practise more Psychiatric harm, economic loss and occupiers.
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