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(2021) 33 SAcLJ 1083
(Published on e-First 22 September 2021)
RECONCEIVING PROXIMITY IN THE DUTY TO AVOID

CAUSING PURE ECONOMIC LOSS
Should the Plaintiff have Protected Himself Through Contract?
Proximity defined as "closeness/directness in the plaintiff-

defendant relationship" is unhelpful in pure economic loss
cases. This article argues for reconceiving proximity in pure
economic loss cases in the form of the question: "should the
plaintiff have protected himself through contract?" If the
answer is yes, proximity is absent and no duty arises. If the
answer is no, proximity is present, and a duty arises unless
policy negatives it.
Justin TAN
LLB (Hons) (NationalUniversity of Singapore);
Advocate and Solicitor (Singapore);
Senior Lecturer, Faculty of Law, National University of Singapore.
I. Introduction
1 Proximity is a necessary condition for finding that the defendant

owed a duty to avoid causing the plaintiff pure economic loss ("PEL").
Proximity refers to the closeness/directness in the relationship between
the plaintiff and the defendant. 2 There are many considerations which
go towards whether proximity is present in a particular case ("proximity
determinants"). Our courts have thus far recognised at least eight
proximity determinants, specifically three proximity concepts and five
proximity factors.
2 Since (a) the proximity determinants are meant to tell us

whether proximity is present in a particular case; and (b) proximity is
the closeness/directness in the plaintiff-defendant relationship, we can
say that the proximity determinants are meant to tell us whether there is
closeness/directness in the plaintiff-defendant relationship. But this turns
out to be a problem. In a PEL case, we need the proximity determinants
1 The author thanks Shawn Tan for research assistance, the anonymous reviewer who
improved the article substantially, and the SAcLJ's editorial team for spotting his
many careless mistakes. All remaining errors are his.
2 Spandeck Engineering (S) Pte Ltd v Defence Science & Technology Agency [2007]
4 SLR(R) 100 at [37] and [77].
1084 Singapore Academy of Law Journal (2021) 33 SAcLj
to point towards or "add up" to a higher-order principle y so that we can

say "proximity is present in this case because y is present" or "proximity
is absent in that case because y is absent". The current definition of y as
"closeness/directness in the plaintiff-defendant relationship" is unhelpful.
It only begs a host of questions like "what is closeness/directness in the
plaintiff-defendant relationship?" and "how much closeness/directness is
required?" This article suggests that the higher-order principle y should
be reconceived in the form of the question: "should the plaintiff have
protected himself through contract?" If the answer to this question is yes,
proximity is absent and no duty arises. If the answer to this question is
no, proximity is present, and a duty arises unless policy negatives it. In
other words, the correct proximity question in a PEL case is not "is there
closeness/directness in the plaintiff-defendant relationship?" Rather,
the proximity question should be: "should the plaintiff have protected
himself by contract?"
3 The structure of this article is as follows. Part II defines PEL.

Part III' defines proximity as closeness/directness in the plaintiff-
defendant relationship and explains its function in the duty of care
analysis. Part IV' introduces the problem: thinking of proximity as
closeness/directness in the plaintiff-defendant relationship does not help
us resolve PEL cases because the proximity determinants do not point
towards or "add up" to closeness/directness in the plaintiff-defendant
relationship. Part V6 starts tackling the problem by grouping the PEL
cases into five categories, in order to discover a higher-order principle y
that runs through them. Part V1 7 argues that the higher-order principle y
that emerges from Part V is: should the plaintiff have protected himself
by contract; if the answer is yes, proximity is absent, if the answer is
no, proximity is present. Part VII clarifies (a) the relationship between
this higher-order principle and vulnerability; and (b) the relevance of
insurance to this principle. Part VIII 9 concludes.
II. What is pure economic loss?
4 PEL is the plaintiff's monetary loss that flows directly from the
defendant's negligence. It is not consequent upon damage to the plaintiff's
3 See paras 4-5.

4 See paras 6-8.
5 See paras 9-18.
6 See paras 19-72.
7 See paras 73-92.
8 See paras 93-94.
9 See paras 95-96.
Reconceiving Proximity in the Duty to Avoid
(2021) 33 SAcLJ Causing Pure Economic Loss 1085
person or property.10 It is distinguished from consequential economic loss

("CEL"), which flows from damage to the plaintiff's person or property
(and thus only indirectly from the defendant's negligence).
5 By way of illustration, consider Spartan Steel and Alloys Ltd v

Martin & Co (Contractors)Ltd." The defendant negligently damaged an
underground electric cable that it knew supplied electricity directly to the
plaintiff's metal-making factory. The factory suffered a temporary loss
of electricity as the electricity board cut the supply to mend the cable.
The plaintiff sued for the profit it could have earned from (a) processing
four additional melts but for the electricity cut; and (b) one melt that was
damaged due to the electricity cut. Claim (a) failed - this lost profit was
PEL as it flowed directly from the negligence. Claim (b) succeeded - this
lost profit was CEL as it flowed only indirectly from the negligence (since
it flowed directly from the physical damage to the melt).
III. Proximity - What it is and its function in the duty of

care analysis
6 Lord Denning MR famously said that the function of the duty

of care is to limit liability for negligence.1 2 In Spandeck Engineering (S)
Pte Ltd v Defence Science & Technology Agency13 ("Spandeck"), the Court
of Appeal laid down Singapore's test for the existence of a duty of care
in negligence claims. Under the Spandeck test, a duty of care exists if
three requirements are satisfied: (a) the harm suffered by the plaintiff is
foreseeable in a purely factual sense; (b) there is proximity between the
plaintiff and the defendant; and (c) policy considerations do not negative
a duty finding.14 We are here concerned with requirement (b) - proximity.
10 NTUC Foodfare Co-operative Ltd v SIA EngineeringCo Ltd [2018] 2 SLR 588.
11 [1973] QB 27.
12 Dorset Yacht Co Ltd v Home Office [1969] 2 QB 412 at 424. See also Spandeck
Engineering (S) Pte Ltd v Defence Science & Technology Agency [2007] 4 SLR(R) 100
at [29]-[30]; John Fleming, "Remoteness and Duty: Control Devices in Liability for
Negligence" (1953) 31 Can Bar Rev 471 at 473-474 and Leon Green, "Foreseeability
in Negligence Law" (1961) 61 Colum L Rev 1401 at 1408.
13 [2007] 4 SLR(R) 100.
4 SLR(R) 100 at [73]-[85]. Technically, factual foreseeability is not part of the
Spandeck test; as it was viewed as almost always fulfilled, it was described as merely
a "preliminary requirement" or "threshold issue": Span deck Engineering(S) Pte Ltd v
Defence Science & Technology Agency [2007] 4 SLR(R) 100 at [73] and [115]. However,
the factual foreseeability requirement was not satisfied in Ngiam Kong Seng v Lim
Chiew Hock [2008] 3 SLR(R) 674; Man Mohan Singh s/o JothirambalSingh v Zurich
Singapore Pte Ltd [2008] 3 SLR(R) 735; and AYW v AYX [2016] 1 SLR 1183. This
suggests that the requirement is no less deserving of proper consideration than the
Spandeck test's other two requirements.
1086 Singapore Academy of Law Journal (2021) 33 SAcLJ
7 Proximity is the closeness/directness in the relationship between

the plaintiff and the defendant.15 Proximity is meant to tell us that
closeness between the defendant's conduct and the plaintiff's damage is
required to found a duty, not just foreseeability. 16 The Court of Appeal in
Spandeck said that proximity focuses on the closeness of the relationship
between the plaintiff and the defendant;" a closer relationship means
proximity is more likely to be found. Similarly, in Anwar PatrickAdrian v
Ng Chong & Hue LLC 18 ("Anwar"), the Court of Appeal said that the
emphasis of proximity is on the "closeness" and "directness" of the
relationship between the parties. 19 As the Privy Council in Yuen Kun
Yeu v Attorney-Generalof Hong Kong20 noted, foreseeability is insufficient
to found a duty (otherwise "there would be liability in negligence on the
part of one who sees another about to walk over a cliff with his head
in the air, and forbears to shout a warning"); what is also required is
proximity, which imports "the whole concept of necessary relationship
between plaintiff and defendant".2 1
8 The difference between proximity and policy is that the former

is only concerned with the interaction between the plaintiff and the
defendant, as well as doing interpersonal justice as between them and
nobody else, while the latter refers to considerations of community
welfare like public morality, social philosophy and economics (ie, reasons
that lie outside the parties).2 2 The Spandeck test applies to all types of
damage suffered by the plaintiff, whether the plaintiff suffered personal
injury, psychiatric harm, property damage or PEL."
4 SLR(R) 100 at [37] and [77].
16 J F Keeler, "The Proximity of Past and Future: Australian and British Approaches to
Analysing the Duty of Care" (1989) 12 Adel L Rev 93 at 97; Richard Kidner, "Resiling
from the Anns Principle: The Variable Nature of Proximity in Negligence" (1987)
7 LS 319 at 319; Christian Witting, "The Three Stage Test Abandoned in Australia
Or Not?" (2002) 118 Law Q Rev 214 at 218.
4 SLR(R) 100 at [77]. This exact statement was repeated in Animal Concerns
Research & Education Society v Tan Boon Kwee [2011] 2 SLR 146 at [36].
18 [2014] 3 SLR 761.
19 Anwar PatrickAdrian v Ng Chong& Hue LLC [2014] 3 SLR 761 at [145].
20 [1987] 3 WLR 776.
21 Yuen Kun Yeu v Attorney-General of Hong Kong [1987] 3 WLR 776 at 783. These
statements were cited with approval in Spandeck Engineering (S) Pte Ltd v Defence
Science & Technology Agency [2007] 4 SLR(R) 100 at [76].
22 ACB v Thomson Medical Pte Ltd [2017] 1 SLR 918 at [49]; David Tan & Goh Yihan,
"The Promise of Universality: The Spandeck Formulation Half a Decade on" (2013)
25 SAcLJ 510 at 535-536.
4 SLR(R) 100 at [115].
-
IV. The problem: Proximity as "closeness/directness in the

plaintiff-defendant relationship" is unhelpful in PEL cases
9 We have seen that proximity is the closeness/directness in the

plaintiff-defendant relationship. There are a multitude of proximity
determinants for determining whether "closeness/directness in the
plaintiff-defendant relationship" is present in a PEL case.24 The Court of
Appeal has recognised at least eight proximity determinants, consisting of
three proximity concepts and five proximity factors.25 The three proximity
concepts are physical proximity,26 circumstantial proximity27 and causal
proximity.28 The five proximity factors are assumption of responsibility,2 9
24 See Jane Stapleton, "Duty of Care Factors: A Selection from the Judicial Menus" in
The Law of Obligations: Essays in Celebration of John Fleming (Peter Cane & Jane
Stapleton eds) (Oxford University Press, 1998) at pp 93-95. Many of the duty of care
factors in this article can be couched as proximity factors.
25 Anwar Patrick Adrian v Ng Chong & Hue LLC [2014] 3 SLR 761 at [117] and
[149]-[154].
26 Physical proximity is closeness, in the sense of space and time, between (a) the
plaintiff's person or property; and (b) the defendant's person or property: Spandeck
Engineering (S) Pte Ltd v Defence Science & Technology Agency [2007] 4 SLR(R) 100
at [78].
27 Circumstantial proximity is the closeness in the factual relationship between the
plaintiff and defendant; thus, for example, circumstantial proximity exists in an
employer-employee and professional-client relationship: Spandeck Engineering (S)
Pte Ltd v Defence Science & Technology Agency [2007] 4 SLR(R) 100 at [78].
28 Causal proximity is closeness in the causal connection between the defendant's
conduct and the plaintiff's damage suffered: Spandeck Engineering (S) Pte Ltd v
Defence Science & Technology Agency [2007] 4 SLR(R) 100 at [78].
29 The definition of "assumption of responsibility" is notoriously unstable: Kit
Barker, "Unreliable Assumptions in the Modern Law of Negligence" (1993)
109(3) Law Q Rev 461 at 461; Andrew Robertson & Julia Wang, "The Assumption
of Responsibility" in The Law of Misstatements: 50 Years on from Hedley Byrne v
Heller (Kit Barker, Ross Grantham & Warren Swain eds) (Hart Publishing, 2015) at
p 49. Arguably, the Court of Appeal in 2011 provided this definition: the defendant
assumes responsibility to the plaintiff when he performs an activity and (a) it is
reasonable for the plaintiff to rely on him taking care in performing such activity;
and (b) he knows or ought to know that the plaintiff will place reliance on him
taking care: Go Dante Yap v Bank Austria CreditanstaltAG [2011] 4 SLR 559 at [35].
Recent cases confirm that the same definition applies in the UK and Canada: see
Steel v NRAM Ltd [2018] UKSC 13 at [19] and R v Imperial Tobacco CanadaLtd
[2011] SCC 42 at [42] respectively. This two-pronged definition of assumption of
responsibility given in Go Dante Yap will be used throughout this article (although
not all cases embrace it).
Under this definition, the twin of assumption of responsibility, reliance, is
exactly the same as element (a): James Plunkett, The Duty of Care in Negligence (Hart
Publishing, 2018) at p 139. (Reliance as defined here is a proximity factor. Technically,
actual reliance is not a proximity factor, although courts often confuse reliance with
actual reliance, perhaps because they are usually both present or both absent on the
facts. The plaintiff's actual reliance should only be relevant at the causation stage of
the negligence action, since the defendant's carelessness would not have caused the
(cont'd on the next page)
reliance, 30 control,31 knowledge32 and vulnerability/dependence.33 The

three proximity concepts are called "concepts" because (a) they are
types of proximity (ie, physical, circumstantial and causal closeness in
the plaintiff-defendant relationship); and (b) proximity is commonly
called the "concept" of proximity.34 The five proximity factors are called
"factors" because they are not types of closeness in the plaintiff-defendant
relationship. Rather, they are facts that indicate closeness (and typically
circumstantial closeness) in the plaintiff-defendant relationship.35
10 We need the proximity determinants to point towards or

"add up" to something; 36 otherwise what is the point of having them?
Specifically, we need the proximity determinants to point towards or "add
plaintiff's damage if the plaintiff did not actually rely on the defendant, even if such
reliance was expected. It is proper to look at reliance at the duty stage, since we are
concerned with the situation of both parties before the plaintiff actually relied on
the plaintiff's conduct and suffered damage: see James Plunkett, The Duty of Care in
Negligence (Hart Publishing, 2018) at pp 138-139.)
An assumption of responsibility is "a sufficient but not a necessary condition of
liability": Customs and Excise Commissioners v Barclays Bank plc [2007] 1 AC 181
at [4], per Lord Bingham. Indeed, it has been observed that where there is an
assumption of responsibility, "questions of 'foreseeability, 'proximity' and 'fairness,
justice and reasonableness' tend to answer themselves": Customs and Excise
Commissioners v Barclays Bank plc [2007] 1 AC 181 at [85], per Lord Mance.
30 Reliance is defined in the immediately preceding note.
31 Control refers to the defendant's control over the risk of harm: NTUC Foodfare
Co-operativeLtd v SIA EngineeringCo Ltd [2018] 2 SLR 588 at [40].
32 Knowledge refers to the defendant's actual or constructive knowledge that his
conduct could lead to the plaintiff suffering harm, or that the plaintiff was dependent
on him for protection from harm: NTUC Foodfare Co-operativeLtd v SIA Engineering
Co Ltd [2018] 2 SLR 588 at [40].
33 Vulnerability/dependence refers to the plaintiff's dependence on the defendant
to protect him from harm: Anwar Patrick Adrian v Ng Chong & Hue LLC [2014]
3 SLR 761 at [154]. It is to be distinguished from "vulnerability", which the Australian
cases define as the plaintiff's inability to protect himself from the defendant's
carelessness. In this article, "vulnerability" takes the Australian definition. See also
note 84 below.
4 SLR(R) 100 at [34] ("the legal conception of proximity" [emphasis in original]),
[80] (the proximity "concept" has some substantive content and is not a mere label),
and [81] (physical, causal and circumstantial proximity provide substance to the
"concept" of proximity); Caparo Industries plc v Dickman [1990] 2 AC 605 at 618
(referring to the "concepts of proximity and fairness"); Yuen Kun Yeu v Attorney-
Generalof Hong Kong [1988] AC 175 at 191 (describing proximity as "importing the
whole concept of necessary relationship between plaintiff and defendant"); Alcock v
Chief Constable of South Yorkshire Police [1992] 1 AC 310 at 411 (referring to the
"concept" of proximity as artificial).
35 See also David Tan, "Debunking a Myth: A Rejection of the Assumption of
Responsibility' Test for Duty of Care" (2014) 22 Torts Law Journal183 at 194.
36 Christian Witting, "The Three Stage Test Abandoned in Australia - Or Not?" (2002)
118 Law Q Rev 214 at 218.
up" to a higher-order principle y so that we can say "proximity is present

in this case because y is present" or "proximity is absent in that case
because y is absent". The current definition of y as "closeness/directness
in the plaintiff-defendant relationship" is unhelpful. It only begs a host
of questions like "what is closeness/directness in the plaintiff-defendant
relationship?" and "how much closeness/directness is required?"
11 The problem can be illustrated with some cases. In Spandeck,

it was held that proximity was absent solely because there was no
assumption of responsibility. 7 By contrast, in Animal Concerns Research
& Education Society v Tan Boon Kwee 38 ("Animal Concerns"), it was
held that proximity was present solely because there was an assumption
of responsibility.39 So it appears that the presence of an assumption of
responsibility is decisive in establishing or negativing proximity. But in
Anwar, it was held that proximity was present even though there was no
assumption of responsibility, because six proximity determinants were
present - physical proximity, causal proximity, circumstantial proximity,
knowledge, control and vulnerability.40 This happened again in NTUC
Foodfare Co-operativeLtd v SIA EngineeringCo Ltd4 1 ("NTUC"); although
there was no finding of an assumption of responsibility, proximity
was held to be present on the basis that three proximity determinants
were present - physical proximity, causal proximity and knowledge.42
How do we explain this? Relying on the definition of proximity as
closeness/directness in the plaintiff-defendant relationship, we can say
that (a) the court in Spandeck was in effect saying that there was no
closeness/directness in the plaintiff-defendant relationship; while (b) the
court in Animal Concerns, Anwar and NTUC was in effect saying that
closeness/directness in the plaintiff-defendant relationship was present
in each of those cases. But that only prompts more questions. What does
closeness/directness in the plaintiff-defendant relationship mean in each
of those four cases? How much closeness/directness is required? Why
is assumption of responsibility a necessary proximity determinant in
Spandeck but not in Anwar and NTUC? Why are the proximity-affirming
proximity determinants different in Anwar as compared to NTUC?
Unfortunately, we do not know the answers. What we do know, however,
4 SLR(R) 100 at [81], [102] and [108].
38 [2011] 2 SLR 146.
39 Animal Concerns Research & Education Society v Tan Boon Kwee [2011] 2 SLR 146
at [63].
40 Anwar Patrick Adrian v Ng Chong & Hue LLC [2014] 3 SLR 761 at [147]-[151],
[154]-[155] and [157].
41 [2018] 2 SLR 588.
42 NTUC Foodfare Co-operative Ltd v SIA Engineering Co Ltd [2018] 2 SLR 588
at [47]-[50].
is that proximity as closeness/directness in the plaintiff-defendant

relationship is short on explanatory power - it cannot explain the cases.
12 So we need the proximity determinants to point towards or "add

up" to something, a higher-order principle which we have called y. This
principle must be able to explain the cases, in the following terms:
In all PEL cases, proximity is a search for y. A helpful definition of y will tell us
what the presence of the proximity determinants are meant to point towards;
what they should 'add up' to. In some cases, y can only be fulfilled if proximity
determinant x is present, and so x is a necessary and sufficient condition to
establish proximity in those cases. In other cases, although x is absent, y can
be fulfilled by the presence of other proximity determinants. For example, in q
case, y can be fulfilled by the presence of m and n proximity determinants, while
in r case, y can be fulfilled by the presence of s, t and u proximity determinants.
13 We could state the problem in another way. Suppose in

a particular case the court finds that physical proximity and control are
present. It then has to consider whether this is sufficient to establish
proximity. The court needs to be able to say that physical proximity and
control are sufficient to establish proximity because collectively they
cause y to be fulfilled (or conversely, that physical proximity and control
are insufficient to establish proximity in this case because collectively they
do not cause y to be fulfilled). Currently, y equals closeness/directness
in the plaintiff-defendant relationship. However, it is meaningless to
say that physical proximity and control are sufficient (or insufficient) to
establish proximity in this case because collectively they cause (or do not
cause) "closeness/directness in the plaintiff-defendant relationship" to be
fulfilled. After all, the three proximity concepts are facets of closeness/
directness - physical, causal and circumstantial closeness/directness,
while the five proximity factors are standalone descriptors of the plaintiff-
defendant relationship and to say that any one or several of them gives
rise to closeness/directness in that relationship brings us no closer to
solving the problem. We are exactly where we started: physical proximity
and control are present; so? Proximity as closeness/directness in the
plaintiff-defendant relationship is like having a compass (the proximity
determinants) without knowing our destination. As the Court of Appeal
stated in Spandeck:43
[W]e agree with Lord Bingham of Cornhill in Customs and Excise
Commissioners v Barclays Bank plc [2007] 1 AC 181 ('Customs and Excise
Commissioners'),where he observed (at [7]) that the 'incremental test is of little
value as a test in itself, and is only helpful when used in combination with a test
or principle which identifies the legally significant features of a situation'
4 SLR(R) 100 at [43].
14 Lord Bingharn's "test or principle which identifies the legally

significant features" is precisely that elusive higher-order principle y. Our
current "test or principle", being "proximity as closeness/directness in the
plaintiff-defendant relationship", is unhelpful. We need a new definition
of y.
15 Perhaps the English cases can help us find a new definition of y?

Unfortunately, no. Lord Bingham has remarked that the "concept of
proximity in the context of pure economic loss is notoriously elusive"."
And the English cases bear him out. Sometimes proximity seems to be
little different from foreseeability or policy, while at other times courts
simply assert that proximity is present without explaining why. Let
us consider the first instance - proximity seems to be little different
from foreseeability or policy. This cannot be the new definition of y
because under the Spandeck test foreseeability and policy are distinct
from proximity. 5 Customs and Excise Commissioners v Barclays Bank
plc46 ("Barclays") illustrates. The plaintiff commissioners served on the
defendant bank a freezing injunction in respect of accounts with the
bank. The bank failed to comply with the injunction and payments were
made out of the accounts. The commissioners were unable to recover
outstanding value added tax amounts from the accounts and claimed
against the bank for negligently inflicted PEL.
16 Although their Lordships unanimously held that the bank did

not owe the commissioners a duty, both Lord Bingham and Lord Mance
noted that proximity was fulfilled on the facts. In so doing, they relied
not insignificantly on the fact that the plaintiff's loss was a foreseeable
consequence of the bank's negligence. Thus, Lord Bingham noted that the
bank "appreciated the risk of loss to the [plaintiff] if [the injunction] was
not obeyed"." Likewise, Lord Mance noted that "the commissioners were
obviously likely to be heavily dependent on the bank's observance of [the
freezing] orders if they were to hope to satisfy any judgments they might
obtain against Brightstar and Doveblue".48
17 Lord Walker equated proximity with the policy concern of

floodgates; proximity was fulfilled on the facts, he said, because the duty
contended for was not a duty leading to "liability in an indeterminate
44 Customs and Excise Commissioners v Barclays Bank plc [2007] 1 AC 181 at [15].
4 SLR(R) 100 at [73]-[86].
46 [2007] 1 AC 181.
Lord Mance also called proximity a "vaguer notion" than foreseeability: Customs
and Excise Commissioners v Barclays Bank plc [2007] 1 AC 181 at [99].
amount for an indeterminate time to an indeterminate class".49 The other

Lordships did not mention proximity.
18 Now let us turn to the second instance, where courts assert that
proximity is fulfilled without telling us why. Obviously, this is of no help
in defining y. Spring v GuardianAssurance pc 0 ("Spring") illustrates. In
that case, the defendant company supplied to third parties upon their
request a "kiss of death" reference in respect of the plaintiff, who was
its ex-staff member. The plaintiff claimed against the company for PEL
stemming from the negligently prepared reference. The House of Lords
held (Lord Keith dissenting) that the company owed the plaintiff a duty
to prepare the reference with care. Lord Keith said, with no reasoning,
that "there was proximity between [the plaintiff] and those who prepared
the reference"." Lord Slynn asserted, again with no reasoning, that
"there is as obvious a proximity of relationship in this context as can be
imagined"". Lord Woolf similarly provided no explanation for why he
believed proximity was fulfilled, merely stating that "the required degree
of foreseeability and proximity undoubtedly exists in this case"." It would
appear, then, that the English cases do not provide us with a candidate for
the higher-order principle y.
V. Searching for a new definition of the higher-order

principle y - Grouping the cases
19 We have identified the problem with proximity in PEL cases: the

current definition of y as closeness/directness in the plaintiff-defendant
relationship cannot explain the cases; they are not the destination for
which the compass of proximity determinants may be deployed in
service of. In this Part, we search for a new definition of y, the higher-
order principle that runs through the cases and what the proximity
determinants should point towards or "add up" to.55 Our method for
defining y is to study the cases to see whether what the cases tell us
are material facts are material because they either (a) pointed towards
(or added up to) y and so proximity was present; or (b) pointed away
from y and thus proximity was absent.
50 [1995] 2 AC 296.
51 Throughout this article, a third party is someone other than the plaintiff or defendant.
52 Spring v GuardianAssurance plc [1995] 2 AC 296 at 307.
55 The words of Lord Mance come to mind: "[T]here is no single common denominator,
even in cases of economic loss, by which liability may be determined": Customs and
Excise Commissioners v Barclays Bank plc [2007] 1 AC 181 at [93].
20 After studying the PEL cases, we can group them into

five categories:
(a) Category 1: the facts of the case fall within the Hedley
Byrne principle;
(b) Category 2: the defendant produced the plaintiff's
property which is later discovered to be defective;
(c) Category 3: a third party contracted with the defendant
for the defendant to perform a service which if performed with
care would benefit the plaintiff, but the defendant performed
poorly and the plaintiff suffered PEL;
(d) Category 4: the defendant damaged a third party's
property and this led to the plaintiff suffering PEL; and
(e) Category 5: residual category, where the facts of the case
do not fall within Categories 1 to 4.
A. Category 1
21 Category 1 cases are those that fall within the Hedley Byrne
principle, and falling within the principle is a sufficient reason to found
a duty. The Hedley Byrne principle, in its original form, is found in the
judgment of Lord Morris in Hedley Byrne & Co Ltd v Heller & Partners
Ltd56 ("Hedley Byrne"):57
[I]f in a sphere in which a person is so placed that others could reasonably
rely upon his judgment or his skill or upon his ability to make careful inquiry,
a person takes it upon himself to give information or advice to ... another
person who, as he knows or should know, will place reliance upon it, then
a duty of care will arise.
22 This statement was cited with approval by the Court of Appeal

in Go Dante Yap v Bank Austria CreditanstaltAG58 ("Go Dante Yap"). 59
Similarly, in Anwar, the Court of Appeal described the principle as
follows: 60
[A] reasonable man who, knowing that he was being trusted or that his skill
and judgment were being relied on, gives the information or advice sought
without any qualification of responsibility, will be taken to have accepted
some responsibility for his answer being given carefully, or to have accepted
56 [1964] AC 465.
57 Hedley Byrne & Co Ltd v Heller & PartnersLtd [1964] AC 465 at 503.
58 [2011] 4 SLR 559.
59 Go Dante Yap v Bank Austria CreditanstaltAG [2011] 4 SLR 559 at [32].
a relationship with the inquirer which requires him to exercise such care as the
circumstances require.
23 The original Hedley Byrne principle was broadened in

three respects by Lord Goff (with whom Lord Browne-Wilkinson,
Lord Mustill and Lord Nolan agreed) in Henderson v Merrett Syndicates
Ltd61 ("Henderson"). First, the principle extended beyond the provision
of information and advice and included the performance of services
generally.6 2 Secondly, the defendant need not have special skill to have
assumed responsibility; special knowledge was sufficient. 63 Thirdly, the
defendant's alleged misconduct may be an omission and not just an
act of commission.6' Later in White v Jones65 ("White"), Lord Browne-
Wilkinson noted that Henderson "shows (if it was previously in doubt)
that the principle ... is as applicable to a case of negligent acts giving rise
to pure economic loss as it is to negligent statement". 66
24 Post-Henderson, then, we can restate the Hedley Byrne principle

as such: a duty arises if there was a "holding-out-ask-and-response";
specifically - (a) the defendant held out that he would perform a task with
care; (b) the plaintiff (or another person acting for the plaintiff) asked
the defendant to perform the task; and (c) the defendant responded by
performing the task. By way of example, Lord Goff described how the
principle applied to the facts in Henderson as such: 67
The managing agents have accepted the Names as members of a syndicate
under their management. They obviously hold themselves out as possessing
a special expertise to advise the Names ... The Names, as the managing agents
well knew, placed implicit reliance on that expertise, in that they gave authority
to the managing agents to bind them to contracts of insurance and reinsurance
and to the settlement of claims.
25 Five clarifications on the Hedley Byrne principle. First, although

English courts sometimes use "Hedley Byrne principle" interchangeably
with "assumption of responsibility" 68 the two are distinct. As noted in
Anwar, "[t]he twin criteria for the Hedley Byrne principle to apply are:
(a) an assumption of responsibility (sometimes referred to as voluntary
61 [1995] 2 AC 145.
62 Henderson v Merrett Syndicates Ltd [1995] 2 AC 145 at 180.
65 [1995] 2 AC 207.
66 White v Jones at [1995] 2 AC 207 at 274.
68 See Lord Goff's judgment in Henderson v Merrett Syndicates Ltd [1995] 2 AC 145
at 180-181. Lord Browne-Wilkinson, Lord Mustill and Lord Nolan agreed with
Lord Goff's judgment.
assumption of responsibility (although we think such terminology

to be ex abundanti cautela)) by the defendant; and (b) reliance by the
plaintiff"6 9 Anwar thus reminds us that proximity is present in a case that
falls within the Hedley Byrne principle, precisely because the proximity
factors of assumption of responsibility and reliance are present.
26 Secondly, the Hedley Byrne principle covers situations where the

defendant performed the task (that is the subject of the "ask") either under
a contract (so that the duty runs concurrent with contractual obligations)
or gratuitously. In Midland Bank Trust C Ltd v Hett, Stubbs and Kemp,70
the defendant solicitor and the plaintiff were in a contractual relationship.
Oliver J noted that "[t]he case of a layman consulting a solicitor for
advice seems to me to be as typical a case as one could find of the sort
of relationship in which the duty of care described in [Hedley Byrne]
exists".7 Another case where the parties were in a contractual relationship
is Go Dante Yap. Here, the Court of Appeal held that banks owed their
customers (who signed account-opening documents with them) a duty
with respect to rendering services and executing instructions.72
27 The Hedley Byrne principle also covers situations where the

defendant performed the task gratuitously, ie, situations where there
is no contract between the plaintiff and defendant. Thus, in Hedley
Byrne itself, the House of Lords was prepared to hold that, but for an
express disclaimer, the defendant bank owed the plaintiff a duty when it
gratuitously furnished the plaintiff a credit reference with respect to its
(the bank's) customer (conveyed through another person), in response
to the plaintiff's request for the reference (conveyed through that other
person). The facts in Hedley Byrne fell within the Hedley Byrne principle
because, as Lord Mustill noted in his dissenting judgment in White, there
was a "bilateral relationship" between the plaintiff and defendant, "being
created on the one hand by the acts of the plaintiffs in first asking for
a reference in circumstances which showed that the bankers' skill and

70 [1979] Ch 384.
71 Midland Bank Trust C Ltd v Hett, Stubbs and Kemp Ibid [1979] Ch 384 at 417. The
court held that the defendant solicitor owed his client a duty to advise that it was
necessary to register an option, before a third party acquired an adverse interest in
the property that was the subject matter of the option.
72 The court held that the defendant owed the plaintiff an implied contractual duty of
care under certain account-opening documents and this implied contractual duty
was sufficient to create the necessary proximity to give rise to a duty in negligence.
But the court also held that even ifthe account-opening documents were disregarded,
there was sufficient proximity on the facts.
care would be relied upon and then subsequently relying on it; and on the
other hand by the bankers' compliance with the request"."
28 Thirdly, to fall within the Hedley Byrne principle, it is not

necessary that the plaintiff and defendant communicated with each other
directly, or that the plaintiff knew the defendant's exact identity, or that
the defendant knew the plaintiff's exact identity. This may be deduced
from Hedley Byrne itself, where a duty would have arisen but for an
express disclaimer, despite the fact that the plaintiff and defendant never
communicated directly, nor did they know each other's exact identity, as
the "ask" and the "response" were conveyed through another person.74
That said, the defendant must assume responsibility to "an identifiable
(although not necessarily identified) person or group of persons, and not
to the world at large or to a wholly indeterminable group"."
29 Fourthly, to fall within the Hedley Byrne principle, the defendant

must or should have known of the purpose, whether general or specific,
of the plaintiff's "ask". As Lord Bridge said in Caparo Industries plc v
Dickman,76 the defendant must be "fully aware of the nature of the
transaction which the plaintiff had in contemplation"." But the defendant
need not have known the details of the transaction, ie, it need not have
known the specific purpose of the plaintiff's "ask". Thus, Lord Morris
in Hedley Byrne said that it was sufficient (for a duty to arise) that the
defendant knew that the request originated from someone who was
contemplating doing business with the defendant's customer.78 Similarly,
Lord Oliver stated in Caparo Industriesplc v Dickman that the purpose
of the "ask" maybe "particularly specified or generally described", as long
as it is made known "either actually or inferentially" to the defendant. 79
Where the defendant had absolutely no knowledge of the purpose behind
the plaintiff's "ask", there is no duty. Thus, in Precis (521) plc v William M
Mercer Ltd,80 the defendant upon the plaintiff's request (communicated
through third parties) furnished information on a company's pension
scheme to the plaintiff who was purchasing shares in the company. The
73 White v Jones at [1995] 2 AC 207 at 287. Lord Mustill also stated earlier: "the plaintiffs
initiated the relationship by the request for a reference; the defendants acted on
the request; and the plaintiffs relied on what they had done": White v Jones [1995]
2 AC 207 at 284.
74 The plaintiff had asked its banker to check on the financial stability of the plaintiff's
client. The banker then checked with the defendant, which was the client's bank.
75 Banca Nazionale del Lavoro SPA v Playboy Club London Ltd [2018] UKSC 43 at [7].
76 [1990] 2 AC 605.
77 CaparoIndustriesplc v Dickman [1990] 2 AC 605 at 620.
78 Hedley Byrne & Co Ltd v Heller & PartnersLtd [1964] AC 465 at 493-494.
79 CaparoIndustriesplc v Dickman [1990] 2 AC 605 at 638.
80 [2005] EWCA Civ 114.
court held that no duty arose because the defendant did not know the
plaintiff's purpose for the request. 81
30 Fifthly, later cases have clarified that to fall within the Hedley
Byrne principle, the plaintiff must have changed his position in reliance
on the defendant's "response" (and suffered loss as a result). This is what
the High Court called "actual reliance" in Millenia Pte Ltd v Dragages
Singapore Pte Ltd.82 Recall that in Barclays the House of Lords held that
the defendant bank did not owe a duty to the commissioners to comply
with a freezing injunction in respect of certain bank accounts. In so
holding, Lord Bingham and Lord Mance attached importance to the fact
that the plaintiff commissioners did not change their position in reliance
on the bank's response. 83
31 In conclusion, the cases show that a duty arises if the facts of the
case fall within the Hedley Byrne principle. The full principle, which is
distinct from an assumption of responsibility, states that a duty arises if:
(a) the defendant held out that he would perform a task
with care;
(b) the plaintiff (or another person acting for the plaintiff)
asked the defendant to perform the task;
(c) the defendant responded by performing the task,
whether pursuant to a contract with the plaintiff or gratuitously,
and with the actual knowledge or constructive knowledge of the
purpose, whether general or specific, of the plaintiff's ask;
(d) the plaintiff changed his position in reliance on the
defendant's response; and
(e) while it is not necessary that the plaintiff and defendant
communicated with each other directly, or that the plaintiff knew
the defendant's exact identity or vice versa, from the defendant's
perspective the plaintiff must be a least an identifiable (ie, not
necessarily identified) person or group.
B. Category 2
32 In Category 2 cases, the defendant produced property which was

purchased by the plaintiff either directly from the defendant (in which
81 Precis (521) plc v William MMercer Ltd [2005] EWCA Civ 114 at [31].
82 [2019] 4 SLR 1075 at [523]. Actual reliance is not reliance as used in this article: see
n 29 above.
83 Customs and Excise Commissioners v Barclays Bank plc [2007] 1 AC 181 at [14]
and [112].
case the plaintiff is a "direct purchaser"), or from a third party (in which
case, the plaintiff is a "downstream purchaser"). Subsequently, the
plaintiff discovered that the property has latent defects (ie, defects that
existed when the property was produced and which were subsequently
discovered after the plaintiff purchased it). The plaintiff then claimed
against the defendant for PEL. The plaintiff suffered PEL and not property
damage because he did not own (or have an interest in) the property
when the defendant negligently damaged it.
33 In this type of case, this article contends that the court's instinctive
reaction is that, since the plaintiff acquired the property through contract,
he should have protected himself from possible latent defects through
contract. The court is cautious about holding that a duty arises since
this would disturb the contractual allocation of risk for latent defects.
However, the court might disturb this risk allocation and hold that
a duty arises if the plaintiff was unable to protect himself contractually,
and if (where the plaintiff is a downstream purchaser) doing so is not
inconsistent with the defendant's initial bargain with the first purchaser.
34 Where the plaintiff is a direct purchaser, the contract between

him and the producer allocates the risk of latent defects between them,
via terms stipulating the scope and duration of warranty and/or clauses
limiting the quantum of damages. Allowing the plaintiff purchaser to
claim in negligence means he escapes the terms of his bargain. This seems
unfair to the defendant, especially if the defendant had accepted a lower
price for the transaction precisely in exchange for the plaintiff agreeing to
bear more of the risk of latent defects.
35 The same concern applies where the plaintiff is a downstream

purchaser. Here, the plaintiff did not purchase the property from the
defendant producer; rather, there are one or more persons between the
defendant and the plaintiff in the ownership chain. There are two contracts
at play - the first between the defendant and the first purchaser, and the
second between the plaintiff and the seller from whom he purchased the
property. Again, the court is cautious about disturbing the contractual
allocation of risk for latent defects. The defendant would have bargained
to limit his liability to the first purchaser. It seems unfair to allow
a stranger to the bargain (the plaintiff downstream purchaser) to ambush
the defendant with negligence liability that exceeds those limitations.
This is especially so if the defendant had accepted a lower price from his
direct purchaser so as to enjoy the benefits of those limitations. Likewise,
the plaintiff-seller contract would have allocated the risk of latent defects
in a certain way. Allowing the plaintiff to bypass this allocation seems like
an undeserved windfall.
36 The court's unwillingness to disturb the risk allocation bargained

for by the plaintiff and the defendant, whether with each other (where the
plaintiff is a direct purchaser) or with third parties (where the plaintiff
is a downstream purchaser), probably stems from the court's respect
for both parties' freedom of contract. It stands to reason, then, that if
the plaintiff was unable to protect himself through contract, the court is
more willing to hold that a duty arises, since the plaintiff never enjoyed
real freedom of contract to begin with. The Australian courts call such
a plaintiff "vulnerable", ie, one who does not have the ability to protect
himself from the consequences of the defendant's carelessness either
entirely or at least in a way that would cast the consequences of loss on
the defendant. 84
37 By way of illustration, consider first the case of Man B&W

Diesel S E Asia Pte Ltd v PT Bumi InternationalTankers85 ("PT Bumi").
In PT Bumi, the plaintiff shipowner claimed in negligence against the
ship engine producer for latent defects. The plaintiff had contracted with
a ship builder to build the ship, and this contract contemplated the builder
acquiring the ship engine from the defendant. The Court of Appeal held
that the defendant producer did not owe a duty to the plaintiff shipowner.
As a downstream purchaser of the engine, the plaintiff's natural claim was
against the builder. Having committed itself to look towards the builder
for redress, 86 the plaintiff should not be allowed to bypass the limitation
of liability clauses in that contract. As the court observed:8 7
It is not for the court to help a party, after the event, to improve his commercial
bargain. Bumi does not deserve any help. Bumi had made its bargain and must
live with it ... There is every reason that the loss should fall on Bumi.
38 The plaintiff in PT Bumi was a sophisticated commercial party

and able to protect itself through contract. It was on this basis that the
court in PT Bumi distinguished Bryan v Maloney8 ("Bryan"), in which
the High Court of Australia held that the builder of a house owed a duty
to the homeowner, who was a downstream purchaser, with respect to
84 Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515 at 530, cited
with approval in Nava Bharat (Singapore) Pte Ltd v Straits Law PracticeLLC [2015]
SGHC 146 at [540]-[542]. Sometimes, our courts use 'vulnerability' to refer to the
plaintiff's dependence on the defendant to protect him from harm. See n 33 above.
85 [2004] 2 SLR(R) 300.
86 Man B&W Diesel S E Asia Pte Ltd v PT Bumi International Tankers [2004]
2 SLR(R) 300 at [48].
2 SLR(R) 300 at [53].
88 (1995) 182 CLR 609.
latent defects in the house. 89 As later noted in Woolcock Street Investments

Pty Ltd v CDG Pty Ltd90 ("Woolcock"), in Bryan "the inability of an
ordinary purchaser of a dwelling house to realistically protect him or
herself against the builder's negligence influenced this Court to allow the
purchaser to sue the builder in tort".91 We could say that in Australian
cases involving latent defects in buildings, vulnerability of the plaintiff
is a necessary factor to establish duty.92 In Woolcock, which featured an
investment company downstream purchaser, the court in holding that no
duty arose said: 93
[T]he most powerful reason for rejecting the proposed duty is that the first
owners and purchasers of commercial buildings are ordinarily in a position to
protect themselves from most losses that are likely to occur from defects in the
construction of such buildings.
39 Plaintiff vulnerability alone may be sufficient to justify imposing

a duty where the plaintiff is a direct purchaser, but not where he is
a downstream purchaser. Where the plaintiff is a direct purchaser,
only the plaintiff-defendant contract is relevant, and the plaintiff's
vulnerability justifies a court looking behind this contract (because the
plaintiff was not in a position to bargain for protection). But consider
the case where the plaintiff is a downstream purchaser. Yes, the plaintiff's
vulnerability taints the contract between the plaintiff and his seller. But
there is still the contract between the defendant and the first purchaser.
Saddling the defendant with a duty owed to the plaintiff disturbs the risk
allocation contained in this contract, in effect creating a disconformity
with the defendant-first-purchaser contract. Thus, in Woolcock, the court
acknowledged the disconformity in imposing a duty the performance
of which would have required the defendant to do more or different
work than the contract with the original owner required or permitted. 94
As pointed out in Woolcock95 and Brookfield Multiplex Ltd v Owners
CorporationStrata Plan 6128896 ("Brookfield"), the duty finding in Bryan
was justified because no such disconformity arose; in Bryan the contract
between the defendant and the first purchaser did not contain any
exclusion of liability clause.
2 SLR(R) 300 at [26].
90 (2004) 216 CLR 515.
91 Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515 at [95].
92 Brookfield Multiplex Ltd v Owners CorporationStrata Plan 61288 (2014) 313 ALR408
at [182].
96 Brookfield Multiplex Ltd v Owners CorporationStrata Plan 61288 (2014) 313 ALR408
at [28].
40 In conclusion, the cases show that a defendant producer of

property does not generally owe the plaintiff owner a duty with respect
to latent defects. This is because the court is reluctant to disturb the risk
of latent defects picked up by the plaintiff and defendant through the
relevant contract(s), which imposing a duty inevitably does. However,
a duty may be imposed if (a) the plaintiff was vulnerable; and (b) (where
the plaintiff is a downstream purchaser) doing so does not create
a disconformity with the defendant-first-purchaser contract.
C. Category 3
41 In Category 3 cases, a third party contracted with the defendant

for the defendant to perform a service which if performed with care would
have benefitted the plaintiff. The defendant performed the service poorly
and the plaintiff suffered and claimed against the defendant for PEL.
42 In this type of case, this article contends that the court's

instinctive reaction is that the defendant owed the plaintiff a duty only
if one condition, which we will call the substantial purpose condition, is
fulfilled: objectively, a substantial purpose for the third party contracting
with the defendant was to benefit the specific plaintiff.97 In other words,
a duty arises if a substantial reason for the third party's entry into the
contract was to benefit the plaintiff. Conversely, if the third party entered
into the contract mainly for reasons other than to benefit the plaintiff so
that any benefit derived by the plaintiff was merely incidental, there is
no duty.
43 By way of illustration, consider the solicitor-disappointed-

beneficiary cases. Here, the defendant solicitor was instructed by the
third-party testator to ensure that the plaintiff beneficiary received
certain benefits after the testator's death. The testator died and the benefits
failed to materialise due to the solicitor's negligence. The disappointed
beneficiary then claimed against the solicitor in negligence. Examples of
these cases include AEL v Cheo Yeoh & Associates,98 White" and Carr-
100
Glynn v Frearsons ("Carr-Glynn"). In these cases, the court was keenly
aware that, as Lord Goff noted in White, "if the solicitor owes no duty to
the intended beneficiaries, there is a lacuna in the law which needs to be
97 The benefit to the plaintiff may be in the form of monetary gain and/or the avoidance
of monetary loss.
98 [2014] 3 SLR 1231 (will invalid because it was executed in the presence of one instead
of two or more witnesses).
99 White v Jones at [1995] 2 AC 207 (solicitor delayed in changing testator's will to
include plaintiff daughters as beneficiaries).
100 [1999] Ch 326 (solicitor failed to advise testatrix to sever joint tenancy with the
result that testatrix's gift of property to plaintiff was ineffective).
filled".1 1This is because the only person with the claim (the estate) suffered
no loss, while the only person who has suffered loss (the beneficiary) has
no claim.102 (Although the majority in White gave separate judgments,
it was noted in Carr-Glynn that the reasoning that formed the majority
opinion in White was Lord Goff's lacuna reasoning.)0 3
44 Implicit in Lord Goff's lacuna reasoning is the substantial purpose

condition. There is nothing unusual in saying that a plaintiff who suffered
loss arising from the defendant's negligence has no claim; indeed, we
have already observed that the function of the duty of care is precisely
to limit negligence liability for such losses. 104 Instead, it is the third party
who stands at the heart of the lacuna reasoning. He has a claim against
the defendant but, extraordinarily, he suffered no loss. In the solicitor-
disappointed-beneficiary context, the person with the claim (the testator
as represented by his estate) has a claim against the defendant solicitor
(in both tort and contract). However, he suffered no loss. And he suffered
no loss precisely because the substantial purpose condition is satisfied
a substantial purpose of his contract with the defendant solicitor was to
benefit not himself, but the plaintiff beneficiary.
45 That Category 3 cases turn on whether the substantial

purpose condition is fulfilled can be seen in Anwar, Gorham v British
Telecommunications plc0 5 ("Gorham") and Dean v Allin & Watts106
("Dean"). In all three cases, the court held that a duty arose because
a substantial purpose of the third party contracting with the defendant
was to benefit the plaintiff. Two other cases show the converse; no duty
arises if the substantial purpose condition is not fulfilled.
46 In Anwar, the defendant solicitor was engaged to help a father

restructure his debts. The father told the defendant that he did not want
the plaintiffs (being his sons) to be personally liable for those debts. The
father and the plaintiffs signed several agreements with the creditor
bank to restructure the debts. The defendant failed to point out that
the agreements contained a clause under which the plaintiffs agreed to
personally guarantee the father's debts. Subsequently, the father defaulted,
101 White v Jones at [1995] 2 AC 207 at 260.

102 White v Jones at [1995] 2 AC 207 at 259-260.
103 "Both Lord Browne-Wilkinson and Lord Nolan expressed their agreement with the
reasons given by Lord Goff ... It must, I think, follow that it is the reasoning in
Lord Goff's speech - and only that reasoning - that can be said to have received
the support of the majority in the House of Lords": Carr-Glynn v Frearsons [1999]
Ch 326 at 335.
104 See para 6 above.
105 [2000] 1 WLR 2129.
106 [2001] EWCA Civ 758.
-
the bank claimed against the plaintiffs under the personal guarantee
clause, and the plaintiffs sued the defendant for failing to bring this clause
to their attention. The Court of Appeal held that the defendant owed the
plaintiffs a duty of care. 10 7 It was crucial to the outcome in Anwar that
a substantial purpose of the father's contract with the defendant solicitor
was to protect the plaintiffs from personal liability. In other words, the
defendant owed the plaintiffs a duty because the substantial purpose
condition was fulfilled. As the court noted:108
Where a solicitor's instructions from a client include or has as its effect the
conferment of a benefit or negativing a detriment to a third party, and the
solicitor undertakes to the client to fulfil that instruction, he would have
brought himself into a direct relationship with the third party, even if the latter
may not have personal knowledge of the transaction or the solicitor.
The [father]'s wish to benefit the [plaintiffs] can only be effected through the
solicitor's careful performance of his legal services to the [father].
[The solicitor] was keenly aware that at least a part of his services was retained
precisely to ensure that [the plaintiffs'] interests were taken care of ... He was
also alive to [the father]'s concern that his sons not have to personally guarantee
his debts.
[emphasis removed]
An objection to viewing Anwar as turning on the substantial purpose

condition being satisfied is this: given that the father gave a host of
instructions to the defendant solicitor in relation to the debt restructuring,
of which only one was to protect his sons from personal liability, how can
we say that a substantial purpose for the father entering into the retainer
was to protect his sons from personal liability?109 There are two possible
responses to this objection. First, a substantial purpose need not be the
(or even a) main purpose for the contract, so long as it is a non-trivial
purpose. Second, the above extracts from the judgment in Anwar show
that the father's desire to protect his sons from personal liability was not
a trivial purpose of the retainer.
47 The importance of the substantial purpose condition in Anwar

can also be seen from academic commentary that Anwar should have been
distinguished from the solicitor-disappointed-beneficiary cases on the
basis that (a) in Anwar the plaintiffs' interests were not fully aligned with
their father's (as the plaintiffs were offering properties as security for their
father's loan); whereas (b) in the solicitor-disappointed beneficiary cases,
the interests of the testator and the disappointed beneficiary were fully
107 The court also held that the defendant was liable under an implied retainer.
108 Anwar PatrickAdrian v Ng Chong& Hue LLC [2014] 3 SLR 761 at [146]-[148].
109 The author thanks the anonymous reviewer for this astute objection.
aligned."' Whether or not we agree with this comment is irrelevant. The

point is that this comment takes for granted that the substantial purpose
condition is a necessary condition for a duty to arise in a Category 2 case.
48 In Gorham, an insurer was held to have owed a duty to

disappointed beneficiaries not to give negligent advice to the customer
which adversely affected the disappointed beneficiaries' interests as the
customer intended them to be. Pill LJ (with whom Schiemann LJ agreed)
said:1
It is fundamental to the giving of advice upon a scheme for pension provision
and life insurance that the interests of the customer's dependants will arise for
consideration. In my judgment, practical justice requires that disappointed
beneficiaries should have a remedy against an insurance company in
circumstances such as the present. On the facts, [the insurer] can have been
in no doubt about his customer's concern for [the plaintiffs]. First amongst
[the customer]'s list of priorities was 'provision for family.' ... Advice was
expected and was directed not only to the interests of [the customer] but to the
interests of his dependants should he predecease them. The advice was given on
the assumption that their interests were involved. Moreover, the provision for
them was not merely a windfall in the sense that a legacy may be a windfall: it
was central to the purpose of the venture into insurance.
49 In Dean, a borrower's solicitor was held to have owed a duty to

the plaintiff lender to ensure the effectiveness of the security for the loan
(being a property owned by a business partner of the borrower). This was
because the borrower had instructed the defendant solicitor to ensure
that the plaintiff lender obtained effective security. As the court noted:
"the provision of effective security was of fundamental importance to
[the plaintiff], and there was on this point a sufficient identity of interest
between [the plaintiff] and [the defendant]".1 1 2 The substantial purpose
condition was thus fulfilled.
50 Conversely, where a third party contracted with the defendant

to perform a service which may only incidentally have benefitted the
plaintiff, the defendant does not owe a duty to the plaintiff to perform
that service carefully. In X (Minors) v Bedfordshire County Council,"3
the local authority in discharging its statutory functions engaged social
workers and psychiatrists who were then brought into contact with the
110 Leong Wai Kum, Alexander Loke & Burton Ong, "The Conceptual Basis of the
Solicitor's Liability to a Third Party Related to the Client: Reconstructing the White v
Jones Principle in Singapore" (2016) 32(1) Journal of Professional Negligence 30
at 35-37.
111 Gorham v British Telecommunicationsplc [2000] 1 WLR 2129 at 2141-2142.
112 Dean vAllin & Watts [2001] EWCA Civ 758 at [69].
113 [1995] 2 AC 633.
"
plaintiffs. A majority of the House of Lords held that the social workers
and psychiatrists owed no duty to the plaintiffs. The substantial purpose
condition was not fulfilled because the services of the social workers and
psychiatrists were performed primarily for the local authority and any
benefit that accrued to the plaintiffs was purely incidental. Lord Browne-
Wilkinson, with whom the other members of the House agreed, said: 1 4
The social workers and psychiatrists were retained by the local authority to
advise the local authority, not the plaintiffs. The subject matter of the advice and
activities of the professionals is the child. Moreover the tendering of any advice
will in many cases involve interviewing and, in the case of doctors, examining
the child. But the fact that the carrying out of the retainer involves contact with
and relationship with the child cannot alter the extent of duty owed by the
professionals under the retainer from the local authority. The Court of Appeal
drew a correct analogy with the doctor instructed by an insurance company to
examine an applicant for life insurance. The doctor does not, by examining the
applicant, come under any general duty of medical care to the applicant. He
is under a duty not to damage the applicant in the course of the examination:
but beyond that his duties are owed to the insurance company and not to
the applicant.
51 Although Lord Browne-Wilkinson's comments were with respect

to claims for physical damage suffered by the plaintiffs (child abuse), they
were subsequently applied in the PEL case of Kapfunde v Abbey National
plc.11 5 There, the plaintiff tried to obtain a permanent job with a company
and declared his pre-existing medical conditions on a standard
questionnaire to the defendant doctor, who was the company's chief
medical adviser in charge of medical screening of potential staff. The
doctor recommended that the plaintiff was unsuitable for employment
and the plaintiff claimed unsuccessfully against the doctor for PEL. It
was held that the defendant doctor owed no duty to the plaintiff. The
substantial purpose condition was not fulfilled since the doctor's position
was "plainly comparable with that of the social workers and doctors
in [the Bedfordshire case], or with that of a doctor examining for the
purposes of life insurance".'
114 X (Minors) v Bedfordshire County Council [1995] 2 AC 633 at 752-753.

115 [1999] ICR 1.
116 Kapfunde v Abbey National plc [1999] ICR 1 at 11. See also Briscoe v Lubrizol Ltd
[2000] ICR 694 (no duty owed by insurers underwriting the employer's scheme,
under which the employer was liable to the plaintiff employee if he became disabled,
when assessing the validity of the plaintiff employee's claim under the scheme); South
Pacific ManufacturingCo Ltd v New Zealand Security Consultants & Investigations
Ltd; Mortensen v Laing [1992] NZLR 282 (NZCA) (an investigator reporting on the
causes of a fire to an insurance company owed no duty of care to the insured whose
claim was rejected because of the allegedly inaccurate investigator's report).
52 The substantial purpose condition also helps explain why an

auditor generally does not owe a duty to persons other than the company
it is auditing with respect to the accuracy of the accounts. In such
cases, a third-party company contracted with the defendant auditor to
perform auditing services. The result of those services, audited accounts
(or accounts "blessed" by the auditor), benefitted other persons that deal
with the company. But this benefit was only incidental; in most cases the
company contracted with the auditor substantially for its own benefit.
Thus, the case law is replete with pronouncements that an auditor owed
no duty to (a) buyers of the company's shares;".. (b) the company's
creditors;118 (c) creditors of the company's related companies with the
company as guarantor; 119 and (d) the company's guarantors."
12
53 In conclusion, the cases show that where a third party contracted

with the defendant for the defendant to perform a service which if
performed with care would have benefitted the plaintiff, whether the
defendant owed a duty to the plaintiff turns on whether the substantial
purpose condition is fulfilled. If objectively a substantial (meaning
non-trivial) purpose for the third party contracting with the defendant
was to benefit the specific plaintiff, a duty arises. Conversely, if objectively
the third party entered into the contract mainly for reasons other than to
benefit the plaintiff, so that any benefit derived by the plaintiff would be
merely incidental, there is no duty.
D. Category 4
54 In Category 4 cases (also called relational economic loss cases),

the defendant damaged a third party's property and this led to the plaintiff
suffering PEL. In this type of case, the court's main concern is that
allowing the plaintiff's claim would result in liability to an indeterminate
class (which we will call the "indeterminacy problem").121
117 CaparoIndustries plc v Dickman [1990] 2 AC 605; James McNaughton PaperGroup

Ltd v Hicks Anderson & Co [1991] 2 QB 113.
118 Al-Saudi Banque v Clarke Pixley [1990] Ch 313; R Lowe Lippmann Figdor and
Franck v AGC (Advances) Ltd [1992] VicRp 93.
119 EsandaFinance CorporationLtd v Peat Marwick Hungerfords (1997) 188 CLR 241.
120 Ikumene SingaporePte Ltd v Leong Chee Leng [1993] 2 SLR(R) 480.
121 As noted in Spandeck Engineering(S) Pte Ltd v Defence Science & Technology Agency
[2007] 4 SLR(R) 100 at [66], PEL is not limited by the laws of nature, as a negligent
act can cause ripple-on economic losses through a complex web of human links.
In contrast, CEL is contingent on physical damage, which is subject to the laws of
nature. A negligently driven lorry's impact zone is always delimited by the laws
of physics; a negligently prepared financial report of a foreign-listed corporation
respects no such laws.
55 There is only one Singapore case in this category: NTUC. It tells

us that a duty may arise in a relational economic loss case only if the
indeterminacy problem is satisfactorily addressed. This problem will be
satisfactorily addressed (and thus a duty will arise) if (a) the third party's
property damage was caused by the defendant's powerful heavy vehicle;1 22
(b) the plaintiff's premises were within the theatre of operations of that
heavy vehicle; and (c) this theatre of operations was a very restricted area.
56 In NTUC, a driver carelessly drove his heavy vehicle into the

pillar of a third party's building (Changi Airport). The pillar supported
the floor of the plaintiff's cafe, which was in the airport lounge. The cafe
did not sustain any property damage but for safety reasons the public
authority ordered a temporary closure of the caf6. The Court of Appeal
held that the driver owed a duty to the cafe in respect of lost profits during
its closure.12 3 The court was willing to do so because on the facts of NTUC
a duty finding would not lead to liability to an indeterminate class in
future cases. This can be deduced for three reasons.
57 First, the court identified the indeterminacy problem as the main

issue in relational economic loss cases. It noted very early in the judgment
that "unlike physical damage, economic losses are not constrained by the
laws of nature: they often ripple out from a negligent act".1 24 Later on, the
court explained:12 5
The critical concern about indeterminacy ... is in relation to liability to an
indeterminate class.
The problem of liability to an indeterminate class arises where the basis on

which the law permits recovery for losses would entitle an unascertainable
class of parties to recover for their loss. The concern therefore does not arise if
the basis on which the law permits recovery restricts recovery to a reasonably
determinate class of victims.
58 Secondly, and following from the extracts above, the basis

on which the court allowed the plaintiff to recover demonstrated its
commitment to defining a reasonably determinate class of victims. As
noted above, 12 6 the court held that the driver in NTUC owed a duty
because of the presence of three proximity determinants - physical
122 In this article, "heavy vehicle" is used as shorthand for any massive property, ie, an
aircraft and a ship will be "heavy vehicles".
123 Given the driver's liability in negligence, the defendant in NTUC Foodfare
Co-operativeLtd v SIA EngineeringCo Ltd [2018] 2 SLR 588, as the driver's employer,
was vicariously liable.
124 NTUC Foodfare Co-operative Ltd v SIA EngineeringCo Ltd [2018] 2 SLR 588 at [2].
at [42]-[43].
proximity, causal proximity and knowledge. More specifically, a duty was

owed because (a) the driver was driving a powerful heavy vehicle (this
contributed to the finding of causal proximity and knowledge);12 7 (b) the
plaintiff's premises were within the driver's theatre of operations (this
contributed to the finding of physical proximity and knowledge); 12 and
(c) this theatre of operations was a very restricted area (this contributed
to the finding of physical proximity). 129 Thus, where a defendant damaged
a third party's property and this led to the plaintiff suffering PEL, the
defendant owed the plaintiff a duty with respect to the latter's PEL only if
these three conditions are fulfilled.
59 In relation to the significance of the driver driving a powerful

heavy vehicle, the court said:130
7 ... [The driver] operated airtugs for 'aircraft towing and pushback
operations'. It is important to note that these airtugs were heavy vehicles
powerful enough to move an aircraft....
[48] ... we reiterate that the Airtug was a heavy vehicle powerful enough to
move an aircraft ... It was the natural and direct consequence of such a vehicle
colliding into a structure supporting the floor of the Lounge that the floor or
part thereof would become unsafe for occupation....
[emphasis in original]
60 In relation to the plaintiff's premises being within the driver's

theatre of operations and that theatre being a very restricted area, the
court said: 31
[The driver] operated airtugs in close propinquity to the [plaintiff's premises]:
the [plaintiff's premises were] located directly above the UBHA, which formed
part of [the driver's] theatre of operations ... [The driver] carried out his
127 NTUC Foodfare Co-operativeLtd v SIA EngineeringCo Ltd [2018] 2 SLR 588 at [48a]
and [50].
128 NTUC Foodfare Co-operativeLtd v SIA Engineering Co Ltd [2018] 2 SLR 588 at [47]
and [50].
129 NTUC Foodfare Co-operativeLtd v SIA Engineering Co Ltd [2018] 2 SLR 588 at [47].
The finding of causal proximity was also justified at [49] on the basis that, although
it could be argued that the building authority's closure order instead of the accident
was the direct cause of the plaintiff's lost profits, it was eminently foreseeable and
a natural consequence of the accident that the building authority would issue
a closure order. This seems to suggest that causal proximity is not difficult to satisfy
in a Category 4 case.
130 NTUC Foodfare Co-operative Ltd v SIA Engineering Co Ltd [2018] 2 SLR 588 at [7]
and [48(a)].
See also NTUC Foodfare Co-operativeLtd v SIA EngineeringCo Ltd [2018] 2 SLR 588
at [71].
operations within a very restricted area, the airside area of Changi Airport. It
is essential to stress that we are not concerned with a case involving a driver
of a heavy vehicle negligently colliding into a pillar supporting the floor of
a shopping mall along a public road, causing tenants on that floor to suffer loss
of profits when the floor is closed. In such a case, there would be insufficient
physical proximity between the driver and the tenants, because the driver would
have been carrying out his operations over a much wider public area, unlike the
present case where [the driver] was operating within a much more restricted
area, giving rise to the requisite physical proximity between [the driver] and
the [plaintiff].
61 Thirdly, although the court categorised the above three conditions

under the proximity limb of the Spandeck test, 3 2 it is clear that the three
conditions were formulated in order to deal with the indeterminacy
problem. The court acknowledged as much when it said: 3
[T]he proximity requirement adequately addresses the concern of liability to an
indeterminate class. In this context, it ensures that [the driver] is only liable for
the pure economic loss suffered by a determinate class, namely, the operators of
businesses in the affected area of the Lounge.
62 In conclusion, we can say that in a Category 4 case, a duty will

arise if the indeterminacy problem is satisfactorily addressed. NTUC tells
us that this indeterminacy problem is satisfactorily addressed if the three
conditions are fulfilled.
E. Category 5
63 Category 5 cases are those that do not fall within Categories 1 to

4. This residual category contains several types of cases.
64 One type of Category 5 case concerns employment references.

Here, the court has to decide whether the defendant, who on request
by a third party provided a reference in respect of the plaintiff who was
formerly engaged by him as a member of his staff, is liable to the plaintiff
for PEL by reason of negligence in preparing the reference. This is not
a Category 2, 3 or 4 case for obvious reasons. It is also not a Category 1
case for at least two reasons. First, there is no "ask and response" - the
plaintiff does not ask the defendant for the reference; rather the "ask"
comes from a potential new employer of the plaintiff. Secondly, the
plaintiff does not change his position in reliance on the reference.
at [46]-[51].
65 Spring and Ramesh s/o Krishnan v AXA Life Insurance Singapore

Pte Ltd"4 ("Ramesh") are employment reference cases where the court
held that the defendant owed the plaintiff a duty. We have seen that the
court's proximity reasoning in Spring is sparse and unhelpful. 135 Indeed,
their Lordships focused on justifyingwhy a dutywould not be inconsistent
with defamation law,136 and occasionally observed that on the facts of
the case a carelessly prepared reference would irretrievably damage the
plaintiff's "entirefuture prosperity and happiness".13 1 In Ramesh, the court
acknowledged that the plaintiff did not change his position in reliance on
the reference. The court instead based its duty finding on the fact that the
plaintiff expected the defendant to take care in the circumstances of the
case, calling this "attenuated reliance", or reliance in a "broad and loose
sense".131
66 A second type of Category 5 case involves valuers or surveyors

of houses. Here, the court has to decide whether the defendant valuer or
surveyor, who valued a house for the purpose of a mortgage, owed a duty
to the plaintiff mortgagor in the absence of a contractual relationship
between themselves, the plaintiff having suffered PEL when it relied on
the overstated valuation in purchasing the house. The outcome of these
valuation cases turns on whether the plaintiff can show that most people
in his position would rely on the valuation without independent inquiry.
Thus, in Smith v Eric S Bush1 39 ("Eric Bush"), Lord Griffiths held that
a duty arose because the "overwhelming probability" was that the plaintiff
would rely on the valuation; in his Lordship's words, "the evidence was
that surveyors knew that approximately 90 per cent. of purchasers did
so":.14o Similarly, Lord Jauncey identified as critical to his duty finding the
fact that the defendant knew that the plaintiff would "probably rely on the
valuation ... in deciding whether to buy the house without obtaining an
independent valuation". 141
134 [2015] 4 SLR 1.

136 Spring v Guardian Assurance plc [1995] 2 AC 296 at 325, 334 and 350-351. Only
Lord Goff said that this case fell within the Hedley Byrne principle: Spring v Guardian
Assurance plc [1995] 2 AC 296 at 319.
137 Spring v Guardian Assurance plc [1995] 2 AC 296 at 326, per Lord Lowry and 342,
per Lord Woolf.
138 Ramesh s/o Krishnan v AXA Life Insurance Singapore Pte Ltd [2015] 4 SLR 1 at [251]
and [255]. The court also found that there was causal and circumstantial proximity
on the facts: Ramesh s/o Krishnan v AXA Life Insurance Singapore Pte Ltd [2015]
4 SLR 1 at [252]-[254].
139 [1990] 1 AC 831.
140 Smith v Eric S Bush [1990] 1 AC 831 at 865.
67 Although the House of Lords in Eric Bush also attached

significance to the fact that the plaintiff had paid (whether directly or
indirectly) for the valuation, 12 it was later shown in Scullion v Bank of
Scotland plc143 ("Scullion") that this is not essential to a duty finding.
The material facts of Scullion and Eric Bush are similar in all respects
but one - the plaintiff purchaser in Scullion was not a homeowner but
an investor who was buying to let. The plaintiff in Scullion also paid for
the valuation." Yet the Court of Appeal held that no duty arose because
(a) people who buy to let are "more likely to obtain, and more able to
afford, an independent valuation or survey";145 and (b) unlike Eric Bush,
"there was no evidence to support the proposition that anything like
90% of those people who bought to let in 2002 relied only on valuations
prepared by a valuer instructed by their mortgagees, rather than obtaining
their own valuation". 146 Indeed, judicial reluctance to impose a duty where
the plaintiff is wealthy is found in Eric Bush itself, with Lord Templeman
expressly reserving his position in respect of "valuations of quite different
types of property for mortgage purposes, such as industrial property,
large blocks of flats or very expensive houses", as "[w]ith very large sums
of money at stake prudence would seem to demand that the purchaser
obtain his own structural survey to guide him in his purchase".14 7
68 A third type of Category 5 case concerns a defendant who is

a certifier of works. Here, the court has to decide whether a certifier of
works performed for a third party owes a duty to the person performing
those works. Cases of this type include Spandeck, Pacific Associates
Inc v Baxter14 8 ("PacificAssociates") and Animal Concerns. They turn on
whether a duty finding would be inconsistent with the contractual matrix.
69 Spandeck and Pacific Associates both involved a defendant who

was appointed by a third party to supervise and certify work performed
by the plaintiff. The plaintiff performed that work (redevelopment of
a medical facility in Spandeck and dredging and reclamation work in
Pacific Associates) pursuant to a contract between the plaintiff and the
third party, and the contract specified that (a) the defendant's duties were
owed to the third party; and (b) any dispute between the plaintiff and
the third party as to the defendant's certification was to be resolved by
arbitration between the plaintiff and the third party. The plaintiff alleged
142 Smith v Eric S Bush [1990] 1 AC 831 at 848 and 852, per Lord Templeman; 865,
per Lord Griffiths and 871, per Lord Jauncey.
143 [2011] 1 WLR 3212; [2011] EWCA Civ 693.
144 Scullion v Bank of Scotlandplc [2011] 1 WLR 3212; [2011] EWCA Civ 693 at [16].
148 [1990] 1 QB 993.
that it suffered PEL arising from its work having been under-certified
by the defendant. In both cases, the court held that there was no duty
because (i) the plaintiff could have protected itself by contracting directly
with the defendant but did not do so; and (ii) imposing a duty would be
inconsistent with the plaintiff's contract with the third party.
70 In contrast with Spandeck and Pacific Associates, the Court of

Appeal reached a duty finding in Animal Concerns. Here, a contractor
was engaged by the plaintiff to construct an animal shelter. The contractor
appointed the defendant as the clerk of works (ie, site supervisor) for
the construction project. The contractor negligently used inferior
materials for backfilling, causing the plaintiff to suffer PEL to repair the
environmental damage. The plaintiff claimed successfully against the
defendant for negligent supervision of the contractor. Unlike in Spandeck
and Pacific Associates, there was nothing in the plaintiff-third party
contract to preclude the imposition of a duty.149
71 A fourth type of Category 5 case involves defendants who would

be in a conflict of interest position if the alleged duty were imposed.
Unsurprisingly, courts are reluctant to impose a duty on defendants if
that would cause them to be in a conflict of interest position,1 5 0 and this
intuition cuts across all duty cases, not just PEL cases. 151 Thus, a solicitor
owes a duty of care to the party for whom he is acting but generally owes
no duty to the opposite party in respect of PEL suffered by that other
party.15 2 The result in Animal Concerns can also be justified on the basis
that imposing a duty would not cause the defendant to be in a conflict of
interest position, because industry practice mandated that the defendant
advance the plaintiff's interests.153
at [71]-[74].
150 Tan Woo Thian v PricewaterhouseCoopers Advisory Services Pte Ltd [2021]
1 SLR 1166 at [17(a)].
151 See James-Bowen v Commissioner of Police for Metropolis [2018] UKSC 40
at [30]-[33] (Commissioner of Police did not owe a duty to her officers, in the
conduct of proceedings against her based on those officers' alleged misconduct,
to take reasonable care to protect them from reputational harm, because the
Commissioner's public duties were inconsistent with protecting the reputational
interests of her officers); and SXH v Crown Prosecution Service [2017] UKSC 30
at [38] (Crown Prosecution Service owed no duty to asylum seeker complaining of
excessive detention because such a duty would conflict with its public duty).
152 Steel v NRAM Ltd [2018] UKSC 13 at [25].
153 The Court of Appeal noted that a clerk of works would ordinarily owe a duty to
persons commissioning the construction works because "as a matter of industry
practice, ... [t]he clerk of works protects the interests of the [commissioner]
against the builder, by inspecting and supervising the works to ensure that they
conform to the [commissioner]'s budget, standards and specifications, and that
the [commissioner] is getting value for money and proper workmanship": Animal
(cont'd on the next page)
72 West Bromwich Albion FootballClub Ltd v El-Safty154 ("WBA") is

another conflict of interest case. The plaintiff football club suffered PEL
when its football player had to retire prematurely following a surgery
which the defendant consultant surgeon had recommended. The court
refused to impose a duty. It was concerned that a duty finding would
put the defendant in an impossible situation, since the interests of the
plaintiff may conflict with those of the player - the former may want the
player to be able to play again in the shortest possible time and this may
lead it to support medical decisions that may adversely affect the player's
long-term health.
VI. Reconceiving proximity: Defining the higher-order

principle y as "whether we can say that the plaintiff
should have protected himself through contract"
73 Recall that y is the higher-order principle that the proximity

determinants should point towards or "add up" to, so that we may
determine whether proximity is present in a particular PEL case. Recall
further that we need a new definition ofy because the current definition
ofy as "closeness/directness in the plaintiff-defendant relationship" does
not explain the cases. In this Part, we propose that y be reconceived: y
should be defined as "whether the plaintiff should have protected
himself through contract" ("Proposed Definition"). If the answer is yes,
proximity is absent. If the answer is no, proximity is present. In other
words, to continue the earlier example,155 a court can say that physical
proximity and control are insufficient to establish proximity in j case
because in j case the plaintiff should have protected himself through
contract. Conversely, a court can say that physical proximity and control
are sufficient to establish proximity in k case because in k case we cannot
say that the plaintiff should have protected himself through contract. How
did we arrive at the Proposed Definition as the higher-order principle y?
In other words, how does the Proposed Definition explain the cases?
74 First, we observe that the Proposed Definition explains why courts

generally reach a no-duty outcome in cases which involved a defendant
producer of property and a direct purchaser plaintiff or a downstream
purchaser plaintiff who later discovered that the property had latent
defects (ie, Category 2 cases). As shown in PT Bumi and Woolcock,
the court is reluctant to disturb the contractual allocation of risks for
latent defects as agreed by the plaintiff and the defendant, whether as
Concerns Research & Education Society v Tan Boon Kwee [2011] 2 SLR 146 at [51]
and [60].
154 [2005] EWHC 2866 (QB).
between themselves (where the plaintiff was a direct purchaser) or with

third parties (where the plaintiff was a downstream purchaser). Another
way of expressing this reluctance to disturb this risk allocation is to say
that the plaintiff should have protected himself through contract, ie, he
should have bargained for a more favourable risk allocation. Thus, we
can say that a court generally reaches a no-duty outcome in Category 2
cases, because it believes that Category 2 facts invite the rejoinder: "Why
are you suing the producer in negligence? You should have contracted for
more protection!"
75 Secondly, the exception to the no-duty outcome in Category 2

cases can be explained by the Proposed Definition. The exception,
following Woolcock and Brookfield, states that a duty may arise in
a Category 2 case if the court is satisfied that (a) the plaintiff was
unable to protect himself contractually; and (b) (where the plaintiff was
a downstream purchaser) doing so does not create a disconformity with
the defendant-first-purchaser contract. The Proposed Definition explains
why proximity is present when (a) and (b) are present. Regarding (a), the
plaintiff who is unable to protect himself contractually (vis-a-vis either
the defendant producer or the seller) should not be expected to protect
himself contractually. Regarding (b), if imposing a duty does not create
additional potential liability for the defendant than that already existing
under the defendant-first-purchaser contract, then we can reasonably
say that the plaintiff should not be expected to protect himself through
contract. Thus, we can say that a court may hold that a duty arises in
one type of Category 2 case, specifically where it cannot say that the
plaintiff should have protected himself through contract. It cannot say
so because (i) it was impossible for the plaintiff to protect himself (since
he was vulnerable); and (ii) if the plaintiff was a downstream purchaser,
the defendant was not assuming any liability other than that which it
had already assumed under the defendant-first-purchaser contract
(for otherwise the defendant would reasonably expect to be paid for
incurring that additional potential liability).
76 We now deal with two potential objections to the explanatory

power of the Proposed Definition in Category 2 cases. First, our courts
have held that developers and architects owed duties to management
corporations of condominiums with respect to latent defects in the
common property.156 How do we explain this duty being owed to
presumably non-vulnerable management corporations? The answer is
156 RSP Architects Planners& Engineers v Ocean FrontPte Ltd [ 1995] 3 SLR(R) 653; RSP
Architects Planners& Engineers v Management CorporationStrata Title Plan No 1075
[1999] 2 SLR(R) 134. A management corporation brings the claim on behalf of the
owners, since the owners collectively own the common property.
that a management corporation is actually vulnerable. A management

corporation has no ability to protect itself through contract because it
does not purchase the common property from the developer (let alone
the architect). Instead, it is a "successor to the developers with respect
to the common property". 157 As explained in RSP Architects Planners
Engineers v Ocean FrontPte Ltd:158
Under s 33(1) of the Strata Act the subsidiary proprietors from time to time of
the lots in a subdivided building comprised in a strata plan constitute the body
corporate, the management corporation. Hence, the management corporation
at the time of its creation was, in fact, the developers themselves who alone
constituted the management corporation. At that stage, the management
corporation was the developers' alter ego. It is only at a later stage as and when
the developers completed the sales of the various lots to purchasers that the
constitution ofthe management corporation changed and subsidiary proprietors
other than the developers then constituted the management corporation.
77 The second objection is: how do we explain the Canadian case

of Winnipeg Condominium Corporation No 36 v Bird Construction Co151
("Winnipeg")? Here, the defendant main contractor was engaged to build
an apartment by a developer. Later on, a section of cladding fell and
inspections revealed dangerous defects in the masonry work which the
defendant was responsible for. The Canadian Supreme Court held that
the defendant main contractor owed a duty to the plaintiff condominium
corporation160 in respect of work that was dangerously defective. The
court reasoned that if recovery was barred, the incentives facing the
plaintiff would be skewed: economically it would be preferable for the
plaintiff to wait till the dangerous defect caused physical injury (to person
or property) rather than fix the defect, because only in the former case
would it be able to claim damages. The court did not consider the plaintiff's
ability to protect itself through contract. But this can be explained - the
test for duty that was applied in Winnipeg did not contain a proximity
limb; instead, it contained only two limbs, foreseeability and policy.
78 We move on. The third reason in support of the Proposed

Definition is that it explains cases that fall within the Hedley Byrne
principle (ie, Category 1 cases) like Hedley Byrne and Go Dante Yap.
Recall that the full principle, which is distinct from an assumption of
responsibility, states that a duty arises if:
157 RSP Architects Planners & Engineers v Management Corporation Strata Title Plan
No 1075 [1999] 2 SLR(R) 134 at [38].
158 [1995] 3 SLR(R) 653 at [70].
159 [1995] 1 SCR 85.
160 The equivalent of our management corporation. The apartment was later converted
into a condominium.
&
(a) the defendant held out that he would perform a task

with care;
(b) the plaintiff (or another person acting for the plaintiff)
asked the defendant to perform the task;
(c) the defendant responded by performing the task,
whether pursuant to a contract with the plaintiff or gratuitously,
and with the actual knowledge or constructive knowledge of the
purpose, whether general or specific, of the plaintiff's ask;
(d) the plaintiff changed his position in reliance on the
defendant's response; and
(e) while it is not necessary that the plaintiff and defendant
communicated with each other directly, or that the plaintiff knew
the defendant's exact identity or vice versa, from the defendant's
perspective the plaintiff must be a least an identifiable (ie, not
necessarily identified) person or group of persons.
79 A duty arises in Category 1 cases because here we cannot say that

the plaintiff should have protected himself through contract. We cannot
say this because there should have been no need for a Category I plaintiff
to contract to protect himself The underlying rationale is that Category 1
facts point to the objective conclusion that the defendant should have
taken care not to have caused the plaintiff PEL, even if the plaintiff did
not pay him. Another way of putting it is that we expect the defendant
in Category 1 circumstances to have undertaken the task with care. As
Lord Devlin put it, a case that falls within the Hedley Byrne principle is
one where the plaintiff-defendant relationship is "equivalent to contract"
but for the absence of consideration. 161 In other words, the plaintiff in
a Category 1 case need not have contracted to protect himself because the
relationship is already almost contractual.
80 Indeed, in one of the earliest comments on Hedley Byrne, Tony

Weir expressed the view that the plaintiff in that case should have
protected himself by contract. In Weir's memorable words: 16 2
They [the claimants] made bad business deals, having taken only a free opinion
before hazarding their wealth in the hope of profit, no part of which, had it
eventuated, would they have transferred to the honest person whom they now
seek to saddle with their loss.... [T]he plaintiffs here could have found a credit
investigation agency; had they done so, the system would have afforded them
a remedy, through the appropriately commercial institution of contract, against
such of their advisers as were careless; the risk on the adviser would be justified
161 Hedley Byrne & Co Ltd v Heller & PartnersLtd [1964] AC 465 at 529 and 530.
162 A J Weir, "Liability for Syntax" [1963] CLJ 216 at 218-219.
by the fee ... A free tip is relevantly distinguishable from a remunerated

opinion, as social practice shows; the guest thanks the hostess, but the hostess
chides the cook.
81 The point is that very early on, it was recognised that whether
a duty arises turns on whether the plaintiff should have protected himself
through contract. Weir disagreed with the House of Lords as to the
answer, but he recognised that that was the correct question. Similarly,
courts may disagree as to the answer to the question "should the plaintiff
have protected himself through contract", but they would be asking the
correct question.
82 The fourth reason for adopting the Proposed Definition is that

it explains the Category 3 "lacuna" cases like White and Anwar. These
cases show that where a third party contracted with the defendant for
the defendant to perform a service which if performed with care would
have benefitted the plaintiff, whether the defendant owed a duty to the
plaintiff turns on whether the substantial purpose condition is fulfilled.
If objectively a substantial (meaning non-trivial) purpose for the third
party contracting with the defendant was to benefit the specific plaintiff,
a duty arises because there is objectively no need for the plaintiff to have
contracted to protect himself; somebody else (the third party) had already
contracted for his protection. Conversely, no duty arises if objectively the
third party contracted with the defendant mainly for reasons other than
to benefit the plaintiff, so that any benefit derived by the plaintiff was
merely incidental. In this instance, the plaintiff should have protected
himself by contract.
83 The fifth reason for adopting the Proposed Definition is

that it explains why proximity is satisfied in relational economic loss
(ie, Category 4) cases: it is generally difficult for a plaintiff to have
contracted to protect himself under Category 4 circumstances. There
is an infinite number of potential defendants (any driver, ship master,
pilot, etc) who could have damaged a third party's property leading to the
plaintiff suffering PEL. It is generally difficult for any Category 4 plaintiff
to have protected himself through contract. Thus, a prima facie duty
arises, unless it is negatived by policy. And NTUC shows that the policy
issue here is the indeterminacy problem (ie, the concern that allowing
the plaintiff's claim would result in liability to an indeterminate class).
Recall that to deal with the indeterminacy problem, the court in NTUC
devised three conditions for a duty to arise: (a) the third party's property
damage must be caused by the defendant's powerful heavy vehicle; (b) the
plaintiff's premises must be within the theatre of operations of that heavy
vehicle; and (c) this theatre of operations must be a very restricted area.
84 A potential objection: NTUC did not explicitly say that

proximity is satisfied in relational economic loss cases. NTUC actually
fashioned the three conditions under the proximity and not the policy
limb of the Spandeck test. This means that, contrary to what was stated
in the immediately preceding paragraph, not all plaintiffs in relational
economic loss cases can fulfil proximity; only those who fulfil the three
conditions can.
85 The answer to the above objection is that the three conditions

can more properly be understood as going towards policy and not
proximity. Recall that policy is concerned with considerations that lie
outside the parties like public morality, social philosophy and economics,
while proximity is concerned with doing interpersonal justice as between
the plaintiff and the defendant and nobody else. The three conditions are
not sensitive to considerations of interpersonal justice. As a matter of
interpersonal justice, it is difficult to see why the hypothetical shopping
mall tenant mentioned in NTUC has a less deserving claim than the
plaintiff in NTUC. 163 The tenant would be understandably aggrieved
at not being able to claim because the defendant (a) was not driving
a powerful or heavy enough vehicle; and/or (b) was not driving within
his theatre of operations when the accident occurred; and/or (c) had
a wide theatre of operations. The fact that the three conditions operate
almost arbitrarily in treating differently the hypothetical shopping mall
tenant and the plaintiff in NTUC supports the conclusion that they reflect
considerations outside the parties, ie, policy considerations. Further,
as shown above, 164 the three conditions were fashioned to resolve the
indeterminacy problem, and since indeterminacy is a policy problem,
the three conditions should be categorised under the policy limb. After
all, another way to state the indeterminacy problem is to say that the
court needs to draw clear boundaries, however arbitrary, to avoid a flood
of litigation. Clearly, this is a consideration that lies outside the parties.
It has nothing to do with interpersonal justice as between the plaintiff
and defendant. For the above reasons, the three conditions go towards
policy rather than proximity, and we should recognise them as such, as
Spandeck exhorts us to.165

164 See paras 57-61 above.
4 SLR(R) 100 at [85]: "If there is truly a pertinent and relevant policy consideration
involving value judgments which reflect differential weighing and balancing of
competing moral claims and broad social welfare goals, we feel that it would be
better if the courts were to articulate these concerns under the requirement of
policy considerations, rather than subsume those concerns within the proximity
requirement ... ".
86 The sixth reason for adopting the Proposed Definition is that it

explains the residual (Category 5) cases. The duty findings in the employer
reference cases are justified because in those cases we cannot say that
the plaintiff should have protected himself through contract. Given
(a) the "irretrievable damage" to the plaintiff's "entire future prosperity
and happiness" that may result from a negligently prepared reference; 166
and (b) the fact that the plaintiff is often vulnerable (ie, unable to protect
himself from a negligently prepared reference after his employment with
the defendant had ended), it should be taken as understood that the
defendant would exercise care in preparing the reference. Ramesh comes
close to saying the exact same thing when it held that a duty arose because
on thefacts the plaintiffexpected the defendant to take care.167 Indeed, three
of their Lordships in Spring also held that the plaintiff succeeded based
on an implied term in the employment contractthat reasonable care would
be taken by the defendant in giving references to potential employers. 168
87 Regarding the mortgage valuation cases, they can be explained as

follows. A duty arose in Eric Bush because the plaintiff adduced evidence
that most people in his position would not have protected themselves
through contract (ie, they would have relied on the defendant's valuation
without independent inquiry). In other words, proximity was present
in Eric Bush because the homeowner plaintiff should not be expected
to protect himself through contract, and he should not be expected to
protect himself through contract because as a matter offact most people in
his position would not have done so. Conversely, the no-duty finding in
Scullion is justified because the plaintiff in that case did not adduce similar
evidence, and this left the way open for the court to say that no duty arose
because the investor plaintiff should have obtained his own valuation.
88 The Proposed Definition also explains the cases that involved

the defendant as a certifier of works. We have seen that these cases turn
on whether a duty finding would be inconsistent with the contractual
matrix. To say that the alleged duty is inconsistent with the contractual
matrix, ie, because the plaintiff's contract with the third party stipulated
that disagreements regarding the defendant's certification should be
settled by arbitration as in Spandeck and Pacific Associates, necessarily
implies that the plaintiff should have contracted with the defendant to
protect himself.

167 Ramesh s/o Krishnan v AXA Life InsuranceSingaporePte Ltd [2015] 4 SLR 1 at [255].
168 Spring v Guardian Assurance plc [1995] 2 AC 296 at 320, per Lord Goff; 340,
perLord Slynn and 353-354, per Lord Woolf.
89 Further, the Proposed Definition explains the conflict of interest

cases like WBA. Obviously, if the defendant maybe in a position of conflict
as between benefitting the plaintiff or a third party, there is an even greater
need for contracts to clearly demarcate where the defendant's obligations
begin and end. Specifically, this would entail the plaintiff contracting with
the defendant to advance the plaintiff's interests, possibly at the expense
of the third party's interests.
90 Lastly, the Proposed Definition should be adopted because it

reflects a general community expectation that one should contract to
protect oneself from monetary loss. Community expectations are highly
relevant to proximity; indeed, proximity has been described as a conduit
for the application of the community's expectations about responsibility.16 9
In Tame v New South Wales; Annetts v Australian Stations Pty Ltd,"0 the
High Court of Australia noted that reasonableness is judged in light
of current community standards."' In Bryan, Mason CJ, Deane J and
Gaudron J said: 2
Inevitably, the policy considerations which are legitimately taken into account
in determining whether sufficient proximity exists in a novel category will be
influenced by the courts' assessment of community standards and demands.
91 So community expectations are highly relevant to proximity.

And in relation to PEL, one could make the case that the community
expectation is that the plaintiff who wants to protect himself from PEL
should do so contractually. Our common experience is that wealth is
generally lost when something is done with money. This means that the
plaintiff could have paid someone, around the time he did that something,
to minimise his risk of losing money. Since the plaintiff could have
reduced the risk of losing money through contracting, the community
expectation is that he should have protected himself through contract,
and so no duty arises, unless the plaintiff had a good reason for not
contracting (ie, there was no need for him to do so, or it was impossible
for him to do so, as shown above.) Indeed, it was noted in Spandeck that
169 See generally Adam Kramer, "Proximity as Principles: Directness, Community

Norms and the Tort of Negligence" (2003) 11 Tort L Rev 70. Cristina Tilley also
observed that tort is a vehicle through which a community perpetually considers,
reconsiders and communicates its values: Cristina Carmody Tilley, "Tort Law Inside
Out" (2017) 126 Yale LJ 1321.
170 [2002] HCA 35.
171 Tame v New South Wales; Annetts v Australian Stations Pty Ltd [2002] HCA 35
at [14].
172 Bryan v Maloney (1995) 182 CLR 609 at 618.
negligence law does not readily allow claims for PEL because plaintiffs
have a greater opportunity to use contracts to protect against PEL. 13
92 For the reasons above, proximity should be reconceived; y

should be defined as "whether the plaintiff should have protected himself
through contract" We can thus say:
In all PEL cases, proximity poses the question of whether the plaintiff should
have protected himself through contract; if yes, proximity is absent and no duty
arises; if no, proximity is present and a duty arises unless negatived by policy.
Proximity determinants are meant to answer this question; they point towards
or 'add up to' the answer. In some cases, we need proximity determinant x
to be present before we can answer 'no, and so x is a necessary and sufficient
condition to establish duty in those cases. In other cases, although x is absent,
we can answer 'no' if other proximity determinants are present; thus, in q case,
we can answer 'no' if m and n proximity determinants are present, while in r
case, we can answer 'no' if s, t and u proximity determinants are present.
VII. Two clarifications 14
93 A clarification is in order regarding whether the Proposed

Definition takes insurance into account. The availability of protection
through insurance was recognised as a duty of care factor in Tan Juay
Pah v Kimly Construction Pte Ltd.175 Although this recognition was as
a factor going towards the policy stage of the Spandeck test for duty and not
as a factor going towards proximity, 176 proximity and policy sometimes
overlap, as the Court of Appeal in Animal Concerns noted.177 It should
thus be open to a court in an appropriate case to consider insurance at the
proximity stage. Therefore, when we ask whether the plaintiff should have
protected himself through contract, it may also be relevant to consider
the plaintiff's insurance position, if protection through insurance is
a reasonable option for the plaintiff. This is analogous to considering
4 SLR(R) 100 at [66]. Conversely, this issue does not arise for CEL: we do not
generally have the opportunity to obtain contractual protection from physical
damage. People and their property are generally free to move around our person and
property. Accompanying this freedom is the risk of negligently-inflicted physical
damage to our person and property.
174 The author thanks the anonymous reviewer for these two insights.
175 [2012] 2 SLR 549.
176 Tan Juay Pah v Kimly Construction Pte Ltd [2012] 2 SLR 549 at [84]-[87]. See
also NTUC Foodfare Co-operative Ltd v SIA Engineering Co Ltd [2018] 2 SLR 588
at [55]-[56] and Resource Piling Pte Ltd v Geospecs Pte Ltd [2014] 1 SLR 485
at [88]-[92].
at [66]-[68].
whether the plaintiffs in Eric Bush and Scullion should reasonably have
obtained an independent valuation to protect themselves.
94 Another clarification relates to the relationship between the

Proposed Definition and vulnerability. We may make the argument: by
asking whether the plaintiff should have protected himself by contract,
are we not merely asking whether the plaintiff is vulnerable? And if so,
the Proposed Definition is superfluous, because vulnerability is already
a proximity determinant, and so it is already accounted for in the proximity
analysis. The response: asking whether the plaintiff should have protected
himself by contract encompasses and includes asking whether the plaintiff
is vulnerable, but it is also more than that. We answer "no" to "should
the plaintiff have protected himself through contract" (and so proximity
is present) in two situations. The first situation is where the plaintiff is
unable to protect himself through contract (ie, where the plaintiff is
vulnerable). A case that falls within the exception to Category 2, like
Bryan, is a first situation case.1' So is a Category 4 (relational economic
loss) case like NTUC. The second situation is where the plaintiff need not
have protected himself through contract, because the factual matrix gives
rise to the expectation that the defendant will take care of the plaintiff's
economic interest notwithstanding there being no contract between the
two. This logic explains the Category 1 "Hedley Byrne principle" cases,
the Category 3 cases that fulfil the substantial purpose condition, and
also why a duty is found in some but not all of the Category 5 "residual"
cases. Vulnerability is unable to explain all these cases; the Proposed
Definition is.
VIII. Conclusion
95 This article identifies a problem with the current definition

of proximity in PEL cases: proximity as closeness/directness in the
plaintiff-defendant relationship is like having a compass (the proximity
determinants) without knowing our destination. In a PEL case, we need
the proximity determinants to point towards or "add up" to a higher-order
principle y so that we can say "proximity is present in this case because
y is present" or "proximity is absent in that case because y is absent". The
current definition of y as "closeness/directness in the plaintiff-defendant
178 As discussed at para 75 above, where the plaintiff is a downstream purchaser,

vulnerability alone is insufficient to found proximity. In that scenario another
condition must be satisfied: the alleged duty cannot create a disconformity with the
defendant-first-purchasercontract. The presence ofthis condition tracks the Proposed
Definition: the plaintiff should not be expected to protect himself contractually if the
alleged duty does not create additional potential liability for the defendant than that
which already exists under the defendant-first-purchaser contract.
relationship" is unhelpful. It only begs a host of questions like "what is

closeness/directness in the plaintiff-defendant relationship?" and "how
much closeness/directness is required?"
96 This article suggests that the higher-order principle y should

be reconceived in the form of the question: "should the plaintiff have
protected himself through contract?" If the answer to this question is yes,
proximity is absent and no duty arises. If the answer to this question is
no, proximity is present, and a duty arises unless policy negatives it. In
other words, the correct proximity question in a PEL case is not "is there
closeness/directness in the plaintiff-defendant relationship?"; rather,
the proximity question should be: "should the plaintiff have protected
himself by contract?" This new conception of proximity can serve as the
destination for which our compass of proximity determinants may be
deployed in service of.

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RECONCEIVING PROXIMITY IN THE DUTY TO AVOID

Should the Plaintiff have Protected Himself Through Contract?

Proximity defined as "closeness/directness in the plaintiff-

1 Proximity is a necessary condition for finding that the defendant

2 Since (a) the proximity determinants are meant to tell us

to point towards or "add up" to a higher-order principle y so that we can

3 The structure of this article is as follows. Part II defines PEL.

II. What is pure economic loss?

3 See paras 4-5.

person or property.10 It is distinguished from consequential economic loss

5 By way of illustration, consider Spartan Steel and Alloys Ltd v

III. Proximity - What it is and its function in the duty of

6 Lord Denning MR famously said that the function of the duty

7 Proximity is the closeness/directness in the relationship between

8 The difference between proximity and policy is that the former

IV. The problem: Proximity as "closeness/directness in the

9 We have seen that proximity is the closeness/directness in the

reliance, 30 control,31 knowledge32 and vulnerability/dependence.33 The

10 We need the proximity determinants to point towards or

up" to a higher-order principle y so that we can say "proximity is present

11 The problem can be illustrated with some cases. In Spandeck,

is that proximity as closeness/directness in the plaintiff-defendant

12 So we need the proximity determinants to point towards or "add

13 We could state the problem in another way. Suppose in

14 Lord Bingharn's "test or principle which identifies the legally

15 Perhaps the English cases can help us find a new definition of y?

16 Although their Lordships unanimously held that the bank did

17 Lord Walker equated proximity with the policy concern of

amount for an indeterminate time to an indeterminate class".49 The other

V. Searching for a new definition of the higher-order

19 We have identified the problem with proximity in PEL cases: the

20 After studying the PEL cases, we can group them into

22 This statement was cited with approval by the Court of Appeal

23 The original Hedley Byrne principle was broadened in

24 Post-Henderson, then, we can restate the Hedley Byrne principle

25 Five clarifications on the Hedley Byrne principle. First, although

assumption of responsibility (although we think such terminology

26 Secondly, the Hedley Byrne principle covers situations where the

27 The Hedley Byrne principle also covers situations where the

69 Anwar PatrickAdrian v Ng Chong& Hue LLC [2014] 3 SLR 761 at [70].

28 Thirdly, to fall within the Hedley Byrne principle, it is not

29 Fourthly, to fall within the Hedley Byrne principle, the defendant

32 In Category 2 cases, the defendant produced property which was

34 Where the plaintiff is a direct purchaser, the contract between

35 The same concern applies where the plaintiff is a downstream

36 The court's unwillingness to disturb the risk allocation bargained

37 By way of illustration, consider first the case of Man B&W

38 The plaintiff in PT Bumi was a sophisticated commercial party

latent defects in the house. 89 As later noted in Woolcock Street Investments

39 Plaintiff vulnerability alone may be sufficient to justify imposing

40 In conclusion, the cases show that a defendant producer of

41 In Category 3 cases, a third party contracted with the defendant

42 In this type of case, this article contends that the court's

43 By way of illustration, consider the solicitor-disappointed-

44 Implicit in Lord Goff's lacuna reasoning is the substantial purpose

45 That Category 3 cases turn on whether the substantial

46 In Anwar, the defendant solicitor was engaged to help a father

101 White v Jones at [1995] 2 AC 207 at 260.

An objection to viewing Anwar as turning on the substantial purpose

47 The importance of the substantial purpose condition in Anwar

aligned."' Whether or not we agree with this comment is irrelevant. The

48 In Gorham, an insurer was held to have owed a duty to

49 In Dean, a borrower's solicitor was held to have owed a duty to

50 Conversely, where a third party contracted with the defendant

51 Although Lord Browne-Wilkinson's comments were with respect

114 X (Minors) v Bedfordshire County Council [1995] 2 AC 633 at 752-753.