Tort recovery of pure economic loss for defective premises in the United Kingdom

: a critical analysis

Abstract

Tort law is not averse to the recovery of economic loss suffered as a consequence of physical damage to a person or property. However, a problem arises with the recovery of pure economic loss as this is a financial loss unconnected to physical injury or damage to property. The four broad categories of pure economic loss are: (1) loss resulting from negligent misstatements; (2) loss caused by negligent performance of professional services; (3) loss stemming from damage to the property of a third party; and (4) loss arising from defective premises. Tort law in the United Kingdom (UK) recognises pure economic loss under categories (1) and (2), but not under categories (3) and (4). Defective premises encompass both commercial and residential premises. This thesis critically examines the UK position on the tort recovery of pure economic loss for defective dwellings. It evaluates the main reasons advanced for denial of economic loss and argues these reasons are unconvincing and unjustified, especially in relation to a subsequent purchaser of a structurally defective house. As a solution, the thesis stresses the need to modify and/or extend legal concepts which are employed for determining the tort liability of economic loss for defective dwellings.

Date of Award	3 Oct 2012
Original language	English
Awarding Institution	City University of Hong Kong
Supervisor	Surya DEVA (Supervisor) & Zhen Charles QU (Supervisor)