Does it Really Matter?

Continuing to follow the decision in Anns v Merton^[1441] has been detrimental to the development of non-paradigmatic^[1442] Canadian negligence law; notably negli­gent misrepresentation, relational economic loss, defective product/structure eco­nomic loss, and statutory public authority immunity cases.

Relying on the Hedley Byrne line of authority to develop the law governing relational economic loss was unnecessary and unhelpful. Some will criticise the Court for failing to have adopted a rights-based approach in support of the gen­eral exclusionary rule and exceptions for relational economic loss. However, while one might quibble about the exceptions to the exclusionary rule, the Supreme Court relying on policy arguments did reach the same answer as that suggested by a rights-based approach. Moreover, if there was ever an area of non-paradigmatic negligence law where the policy arguments were generally accepted as relevant and clear by lawyers, judges and academics, it is in the area of relational economic loss.

Relying on the Hedley Byrne line of authority to develop the law governing defective product/structure economic loss was also unnecessary and unhelpful. Again, some will criticise the Court for failing to have adopted a rights-based approach which supports denying recovery for such losses in negligence. With product/structure defects there is no consensus about whether the policy arguments in support of liability are appropriate, relevant and clear. There is no obviously objectively correct policy outcome, and liability is not supported by the rights-based approach. It might have been preferable for the Court to at least have considered, if not deferred to, the implications of the relevant contractual and statutory rules in play.

The Supreme Court was wrong to abandon Hedley Byrne in Hercules. There exists no stand-alone primary right to purely economic security and no appetite among philosophers or most jurists to create one. The right to sue for detrimental reliance loss in misrepresentation must be granted by the defendant's assump­tion of responsibility. The ‘end and aim' requirement is really a statement of what responsibility was assumed. Properly applied, it ensures that there will be no resid­ual policy concern about indeterminate liability.

An interesting question is whether the choice between a Hedley Byrne assump­tion of responsibility approach on the one hand, and a Hercules foreseeable reliance approach with an ‘end and aim' indeterminacy adjustment on the other, really matters?^[1443] The responsibility for the ‘end and aim' is nothing more or less than what responsibility was, on an objective determination, assumed. So either the assumption of responsibility approach or the Hercules approach should arrive at the same outcome. True, under the Anns approach, the onus of proof rests with the plaintiff to establish proximity, but on the defendant to establish policy rea­sons to negative a prima facie duty of care. This might lead to a small sample of different outcomes. Otherwise, what is the difference?

The case in which a different outcome would be possible is one in which the plaintiff foreseeably relied in the sense that the plaintiffs reasonably relied in Hercules, but potentially indeterminate liability did not arise on the facts. Hercules stands for the proposition that the defendant ought to be liable to anyone who foreseeably relies unless there is a practical problem. Given that Hercules has never been challenged on such grounds in over 15 years, this is probably not a major practical problem.

That low probability of objectionable outcomes under Hercules is not a suf­ficient justification for ignoring the error in Hercules. The message of Hercules is as follows: any foreseeable plaintiff may use without purchasing or negotiating permission another's commercial information or advice without the defendant's consent.