Concurrent Liability in Tort and Contract

A negligent breach of contract may give rise to concurrent liability: a claim in contract or a claim in tort. Undertake an evaluation of this statement using related case law.

The breach of contractual duty between the parties involved gives rise to liability from such breach. The doctrine of privity of contract, which is between specified parties, makes the nature of contractual liability in personam. In consequence, such breach of contractual duty gives rise to certain remedies, including specific performance of contract, liquidated damages and even unliquidated damages. Liability in tort arises from different principles of law. Liability from tort does not require a contract between the parties, but it arises from a breach of a duty fixed primarily by law. Such duty is towards persons in general and thus makes the nature of tortuous liability in rem. Breach of duty in torts generally gives rise to certain remedies such as injunctions, unliquidated damages, etc. As one can see here, liability in contract and in tort are from different principles of law. The next paragraphs will discuss the scope of concurrent liability in tort and contract by demonstrating the differences between tortious and contractual liability, the nature of concurrent liability, and the situations where liability in tort can arise in a case where the parties are in a contractual relationship. For students grappling with understanding all these intricacies, seeking law dissertation help can provide clarity and guidance in navigating all the complex legal concepts.

Liabilities in tort and in contract do not generally overlap as they are from different principles of law, there are cases or situations where the liability in tort and contract do overlap. When they do, it is leads to concurrent liability. Thus, a cause of action may arise in both law of tort and law of contractual. Review of doctrine of concurrent liability should have some logical structure to begin with. In this context, it is essential to establish the existence of a legal duty and its content in order to assess the consequence. The correlative of a ‘duty’ is a ‘right’. A person to whom a legal duty is owed is entitled to an enforceable right against the person who owes such duty to act to the duty. The words ‘tortious’ and ‘contractual’ are adjectives. They attribute to an origin and a normative foundation to a duty. In regard to tortuous liabilities, the law arising from the relationship between the parties imposes tortious duties. Such duties are justified by the legal intention of protecting the obligee's rights, including rights to bodily integrity, property, etc. In regard to contractual liability, a legally recognised agreement or promise arises from a contractual duty. Such duty is normatively justified by the agreement or promise. The landmark case of Donahue v Stevenson is one classic example that demonstrates such an interplay or overlap between principles and liabilities of contract and

---

1. A Best and D Barnes, Tort Law: Cases, Statutes, and Problems (New York: Aspen Publishers 2007).
2. Percy H. Winfield, The Province of the Law of Tort (Cambridge University Press 2013).
3. Aaron Taylor, ‘Concurrent Duties’ (2019) 82 (1) The Modern Law Review 17-45.
4. R. Stevens, Torts and Rights (Oxford: Oxford University Press, 2007).
5. S. Smith, Contract Theory (Oxford: Oxford University Press 2004).

tort. The court in this case held the manufacturer of ginger beer liable for its negligence after one of its customers fell ill after finding a dead snail in the beer bottle that she had drunk out of. The court asked the manufacturer to pay damages to this customer. It is also interesting to point this out that that the actual contract was not between the supplier and the victim but was between the supplier and a friend of the victim. In order to apply the principle of tort, the House of Lord articulated the neighbor principle to ensure tortious liability by a party to another in the absence of a contract. This case may not be a direct example of concurrent liability, but it surely shows how liability in tort could be applied in the absence of a contract.

Concurrent liability generally arises in cases of negligence. For instance, where there is sale of unsafe products, the buyer and seller have a contract. Action will arise by reference to this contract and also due to sale of unsafe product, action for negligence will also arise in tort in the event of a damage or loss suffered by the buyer. Under the principle of concurrent liability, a victim in such situation could bring either or both take up contractual and tortious actions against the seller. Under the law of tort, as was seen in the case of Donahue v Stevenson, an action for negligence can be filed. Therefore, concurrent liability arises in such situations and the seller is liable for the faulty product in the law of tort and also contractually liable due to its breach of the contract between the seller and the buyer. The existence of contractual relation entitled the buyer to even utilise breach of warranty or condition in order to enforce liability for faulty product. However, the buyer may choose to sue under the law of tort as it gives the buyer an opportunity to claim unliquidated damages. This reasoning is expressed in the statement of Lord Goff in the case of Henderson v Merrett Syndicates Ltd:

[G]iven that the tortious duty is imposed by the general law, and the contractual duty is attributable to the will of the parties, I do not find it objectionable that the claimant may be able to take advantage of the remedy which is most advantageous to him, subject only to ascertaining whether the tortious duty is so inconsistent with the applicable contract that, in accordance with ordinary principle, the parties must be taken to have agreed that the tortious remedy is to be limited or excluded.

Principles of concurrent liability could be seen in contracts for professional services. In solicitor’s services, the solicitor could be held liable due to the existence of a contractual

---

6. Donahue v Stevenson [1932] UKHL 100.
7. WAD Miller and S Rukawina, ‘Canada' in Christian Campbell, International Product Liability (Lulu.com 2009) 97-103.
8. Donahue v Stevenson [1932] UKHL 100.
9. Henderson v Merrett Syndicates Ltd [1995] 2 AC 145 (HL).

relation and also be held liable in tort due to the existence of duty to take care, in case there is a violation of some negligent act or misstatement of the solicitor. It is important to note that a person cannot use the availability of concurrent liability to circumvent his/her contractual liability,even if the concurrent liability was discussed in respect to professional relationships and the concurrent liability is an acceptable feature in English law. In Sumitomo Bank v Bank Bruxelles Lambert SA, it was held that tortious liability may be considered more onerous than the contractual one. Despite the existence of contractual relationship between parties, the tortious liability for misstatements may arise irrespective. In this context, court can establish a duty of care where the contractual relationship between the parties serves sufficient proximity to establish such a duty of care in case of misstatements.

The discussion so far demonstrates the existence of two duties structure based on the principle that tortious liability and contractual liability proceed from different principles and hence liability may arise both in contract and in tort. In this structure, there is an ‘assumption of responsibility’ duties that are assumed to be independent non‐contractual duties. However, there is another structure that could consider duties as part of the law of contract and not a part of law of negligence. This structure could be considered as a flaw of the principle of concurrent liability. There is a contractual nature attached to duty assumed in cases ‘akin to contract’; however, the courts were constrained against finding an actual contract because of the requirement of consideration. The assumption of duty predated categoristation into contract and tort, and therefore it cannot sensibly be forced into either category. There are restrictions on the permissive rule of concurrent claim, for instance the recovery for economic loss is limited to contract claim and that the right of a plaintiff to tort claim for only economic loss is limited. Another instance is the tort liability arising out of bad faith breach of contract is mostly limited to relationship in insurance contract. An exculpatory clause or contractual term of liquidated damages can exclude tortuous duty of care. Any duty of care inconsistent with the agreed terms in a contract can also be excluded. The test of remoteness applied in breach of contract can be applied in the tort claims in order to limit the

---

10. Sir Fred Phillips, Ethics of the Legal Profession (Oxon: Routledge 2016).
11. Central Trust Co v Rafuse (1986) 31 DLR (4th) 481 , 1986).
12. Hendersen v Merrett Syndicate (1994) 3 All ER 506, 1994.
13. Sumitomo Bank v Bank Bruxelles Lambert SA (1997) 1 Lloyds Rep 487, 1997.
14. Ibid.
15. Hedley Byrne & Co Ltd v Heller & Partners Ltd, [1964] AC 465, 1964.
16. R. Stevens, ‘Hedley Byrne v Heller: Judicial Creativity and Doctrinal Possibility’ (1964) 27 MLR 121, 155‐160.
17. N. McBride, Key Ideas in Contract Law (Oxford: Hart Publishing 2017).
18. P. Winfield, The Province of the Law of Tort (Cambridge: Cambridge University Press 1931).

scope of recoverable damages in concurrent tort claim. Such a restrictive approach is aimed at protecting expectations of parties and not much to do with deterring any wrongful conduct. The limitation in concurrent liability could also be shown by referring to Sections 5 and 2 of the Limitation Act 1980, according to which limitation period for contract or tort action is “six years from the date on which the cause of action accrued”. Here, the accrual dates can be different. In contract, the accrual date for breach will be when, for example the solicitor failed to take reasonable care and provide wrongful advice. In tort, it is different and the accrual date is the date of damage or when there is damage for relying on advice. There is a practical implication of such difference that could significantly impact the expiry of limitation in a number of cases.

Concurrent liabilities depend on case to case and relevant principles have to be applied to determine duties and relevant liabilities considering the legal elements involved.

---

19. Phutchaya Numngern, ‘The Concurrent Liability in Contract and Tort Under US and English Law: To What Extent Plaintiff Is Entitled to Recover for Damages Under Tort Claim?.’ (2017) Indiana University Maurer School of Law.
20. Bolt Burdon Kemp, The interplay between concurrent liability in tort and contract: a claimant’s perspective’ (2015) accessed .

Cases

Central Trust Co v Rafuse (1986) 31 DLR (4th) 481 , 1986).

Donahue v Stevenson [1932] UKHL 100.

Hedley Byrne & Co Ltd v Heller & Partners Ltd, [1964] AC 465, 1964.

Henderson v Merrett Syndicates Ltd [1995] 2 AC 145 (HL).

Hendersen v Merrett Syndicate (1994) 3 All ER 506, 1994.

Sumitomo Bank v Bank Bruxelles Lambert SA (1997) 1 Lloyds Rep 487, 1997.

Books

Best A and Barnes D, Tort Law: Cases, Statutes, and Problems (New York: Aspen Publishers 2007).

McBride N, Key Ideas in Contract Law (Oxford: Hart Publishing 2017).

Miller W and Rukawina S, ‘Canada' in Christian Campbell, International Product Liability (Lulu.com 2009) 97-103.

Phillips F, Ethics of the Legal Profession (Oxon: Routledge 2016).

Taylor A, ‘Concurrent Duties’ (2019) 82 (1) The Modern Law Review 17-45.

Smith S, Contract Theory (Oxford: Oxford University Press 2004).

Stevens R, Torts and Rights (Oxford: Oxford University Press, 2007).

Winfield PH, The Province of the Law of Tort (Cambridge University Press 2013).

Winfield P, The Province of the Law of Tort (Cambridge: Cambridge University Press 1931).

Journals

Phutchaya Numngern, ‘The Concurrent Liability in Contract and Tort Under US and English Law: To What Extent Plaintiff Is Entitled to Recover for Damages Under Tort Claim?.’ (2017) Indiana University Maurer School of Law.

R. Stevens, ‘Hedley Byrne v Heller: Judicial Creativity and Doctrinal Possibility’ (1964) 27 MLR 121, 155‐160.

Others

Bolt Burdon Kemp, The interplay between concurrent liability in tort and contract: a claimant’s perspective’ (2015) accessed .

Dig deeper into Challenging Conviction: A Comprehensive Examination of Concerns with our selection of articles.