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Crunching Concepts: Peering into Pure Economic Loss

12 July 2023 | CaseSnappy Team

A large number of British £5 and £20 notes spread across a flat surface.


In this edition of our “Crunching Concepts” series, CaseSnappy explores the intricate world of Pure Economic Loss. Often a contentious topic in the realm of tort law, the concept of Pure Economic Loss helps navigate economic harm resulting from negligence, without any accompanying physical injury or property damage.

What is Pure Economic Loss?

Pure Economic Loss is a legal term that focuses on financial detriment suffered due to a defendant's negligence, isolated from any tangible damage. The challenge facing claimants seeking damages for pure economic loss lies in the fact that, within UK tort law, this type of harm is guarded against more rigorously, with Courts adopting a more cautious approach to avoid exposing defendants to unlimited liability.

Why is Pure Economic Loss Important?

Pure Economic Loss is essential to grasp for several reasons:

1. It aids in determining the scope of damages in negligence claims that do not involve any physical injury or property damage.

2. It underscores the boundaries of tort law in awarding compensation, indicating scenarios when remedies under contract law might be more fitting.

3. Comprehension of this concept assists in identifying the circumstances when Courts may allow compensation for pure economic loss, such as cases of negligent misrepresentation or faulty provision of services.

4. The approach to pure economic loss enforces the principle of a certain level of closeness and predictability between the defendant's actions and the claimant's damage, in forming a duty of care.

CaseSnappy: Your Legal Toolkit

Developing an understanding of the facets and implications of Pure Economic Loss, along with other significant legal concepts, is crucial for law students and professionals. CaseSnappy is here to elucidate these complex principles with straightforward summaries, steering you through the labyrinth of law.

Eager to enrich your legal acumen? Join CaseSnappy for free today and promptly access summaries of essential legal concepts. Stay tuned for the next post in our "Crunching Concepts" series!

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