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MISLEADING APPEARANCES IN THE TORT OF DECEIT

Published online by Cambridge University Press:  05 July 2016

John Murphy
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Abstract

This article explores certain key features of the tort of deceit which, if looked at only superficially, are apt to mislead as to the gist, nature, and province of this tort. In particular, the article addresses three main issues. The first is the way in which the reliance test used in this tort comes apart from a simple (more familiar) test of causation, and why this has important theoretical ramifications. Secondly, the article seeks to reveal the true gist and province of this tort. In this regard, it is argued that it is a mistake – made by many – to suppose that the infliction of economic loss forms the gist of deceit. Instead, it is suggested that the tort is better seen as being rights-based and that, consequently, it ought not to be seen as a specifically economic tort, but rather as one which protects the victim's decision-making autonomy. Lastly, the article unearths the juristic explanation for the curious fact that, in the tort of deceit, the operation of the contributory negligence defence is excluded while the mitigation principle is applied openly. (The incoherence here inheres in the fact that both these principles are animated by the self-same concern: a desire to exclude the recovery of losses that are attributable to an unreasonable lack of self-regard on the part of the claimant.) The juristic explanation I unearth is then subjected to critical analysis in the course of which I suggest that we ought not to confuse explanation with justification. I conclude that there is no sound reason of principle to exclude the operation of the contributory negligence defence in this tort.

Keywords

reliancegist of the tortcontributory negligence and mitigationtort theory
Type
Articles
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The Cambridge Law Journal , Volume 75 , Issue 2 , July 2016 , pp. 301 - 332
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Copyright © Cambridge Law Journal and Contributors 2016 

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References

1 Most textbooks and treatises on the law of torts eschew analytical rigour in favour of only fairly cursory accounts of this tort. The notable exception is H. Carty, An Analysis of The Economic Torts (Oxford 2010), ch. 9.

2 In the three years prior to the writing of this article, there were over 20 reported cases revealed by a Westlaw search in which deceit was either relied on as the main, or as an alternative, cause of action. Furthermore, deceit remains relevant in some cases of causing loss by unlawful means even though the party actually deceived may be a mere unharmed intermediary (as in e.g. National Phonographic Co. Ltd. v Edison-Bell Consolidated Phonograph Co. Ltd. [1908] 1 Ch. 335).

3 Although there are important differences between various versions of rights-based theory, none of them is significant for present purposes. The treatment of deceit by some of the leading rights theorists is considered in Section IV of this article.

4 Arguably, it is not very helpful, perhaps even misleading, to set up a contrast between the reliance requirement in deceit and what I have chosen to call causation simpliciter. This is because tort law embraces a number of different conceptions of causation rather than one simple one. These varying conceptions include the well-known “but for”, and (more sophisticated) NESS tests as well as a number of other, policy-driven rules that have little to do with genuine cause and effect. Nonetheless, I think that there exists a link between each of these other approaches to causation which is signally absent in the case of deceit. It is this. Virtually all other tests of causation have as their primary point of focus what D did so as to bring about occurrence X. In deceit, however, the primary point of focus is what C did: namely rely to his detriment upon a false statement made by D. It is the fact that primary attention is ordinarily devoted to D's acts (rather than to C's acts in combination with, or subsequent to, D's acts) that is intended to be captured by my use of the term “causation simpliciter”. Admittedly, C's hypothetical conduct might occasionally play a part in the causation enquiry outside the province of deceit (see e.g. McWilliams v Arrol [1962] 1 W.L.R. 295) but, even here, C's hypothetical conduct can be distinguished from C's actual conduct (which is central to the reliance question in deceit).

For a thoroughgoing, reductive account of the various tests for causation in the law of torts in which the unifying thread is identified as being the “defendant's involvement” in the occurrence of a particular phenomenon, see Stapleton, J., “Choosing What We Mean by Causation in the Law” (2008) 73 Missouri L.Rev. 433Google Scholar, 474.

5 In the US, the action is generally labelled “fraud”, although the term “deceit” can be used as a synonym. In English law, fraud is not an appropriate synonym due to the existence of a sui generis form of action which has been judicially labelled “fraud” and which involves the bribing of agents so as to extract money from their principals. And this action “based on bribery is not a species of deceit … [since] there is no representation made to the principal of the agent, let alone reliance”: Petrotrade Inc. v Smith [2000] 1 Lloyd's Rep. 486, 490, per Steel J.

6 [2008] UKHL 19; [2008] 1 A.C. 1.

7 For treatment of some of these questions, see R. Bagshaw, “Lord Hoffmann and the Economic Torts” in P.S. Davies and J. Pila (eds.), The Jurisprudence of Lord Hoffmann (Oxford 2015).

8 In the wake of OBG v Allan, there would seem to be just two main economic torts: causing loss by unlawful means and inducing breach of contract. Neither is bilaterally structured as both require the involvement of an intermediary.

9 Carty brackets it with what she calls the “misrepresentation economic torts” (Carty, note 1 above).

10 See e.g. G. Williams, Joint Torts and Contributory Negligence: A Study of Concurrent Fault in Great Britain, Ireland and the Common-Law Dominions (London 1951), 281–82: “… the duty to mitigate is merely a species … of the broad doctrine of contributory negligence.” See also T. Weir, An Introduction to Tort Law (Oxford 2006), 128 (packaging the mitigation rule into the chapter on contributory negligence).

11 So central is it to the law of torts for some jurists that they either do or would afford it pride of place as the opening chapter in their textbook or treatise on the subject: see e.g. M. Jones (ed.), Clerk and Lindsell on Torts (London 2014); R. Stevens, Torts and Rights (Oxford 2007), 303. Legal philosophers, too, have long insisted on the fundamentality of causation within tort law: see e.g. H.L.A. Hart and T. Honoré, Causation in the Law (Oxford 1985), 1–129; W. Lucy, Philosophy of Private Law (Oxford 2007), ch. 5.

12 The oddity is not unique to deceit, however. Similar issues concerning detrimental reliance also arise in the context of negligent misstatements and the law governing misrepresentation.

13 AIC Ltd. v ITS Testing Services (UK) Ltd. [2006] EWCA Civ 1601; [2007] 1 Lloyds Rep. 555, at [251].

14 [1941] 2 All E.R. 205.

15 [1941] 2 All E.R. 205, 211.

16 (1837) M. & W. 519, 531.

17 Kaye v Robertson [1991] F.S.R. 62, 67, per Glidewell L.J.

18 See e.g. Warnink (Erven) BV v Townend and Sons Ltd. [1979] A.C. 731.

19 [1964] A.C. 1129.

20 It is arguably the case that intimidation involving just two parties and cases of conspiracy are two-party economic torts. However, such a claim is by no means uncontroversial. I, for example, have elsewhere shown two-party intimidation to be best understood as something other than an economic tort: see Murphy, J., “Understanding Intimidation” (2014) 77 M.L.R. 33CrossRefGoogle Scholar. Equally, it has been powerfully argued that unlawful means conspiracy is an otiose and anomalous cause of action given that where A and B combine to harm C by tortious means, they could perfectly well be dealt with under the rules of joint tortfeasance (see Stevens, note 11 above, pp. 248–49). The highly controversial decision in Total Network v Revenue and Customs Commissioners [2008] UKHL 19; [2008] 1 A.C. 1174 (allowing common law crimes to count as unlawful means) is the only obstacle to dealing with such cases in this way. Finally, lawful means conspiracy is anomalous because it renders tortious the doing of something by two or more people that would be a lawful thing to do by any one of them acting alone.

21 For the argument that the “defendant's involvement” is something like a golden thread running throughout all legal usage of the term causation, see Stapleton, note 4 above.

22 For discussion of reliance as a special form of causation, see Witting, C., “Duty of Care: An Analytical Approach” (2005) 25 O.J.L.S. 33Google Scholar, 56; Barker, K., “Unreliable Assumptions in the Modern Law of Negligence” (1993) 109 L.Q.R. 461Google Scholar, 480.

23 Goldberg, J.C.P., Sebok, A.J., and Zipursky, B.C., “The Place of Reliance in Fraud” (2006) 48 Arizona L.Rev. 1001Google Scholar.

24 At the same time, the intermediary who is lied to may suffer no harm and accordingly she, too, will have no available action in deceit: see e.g. National Phonographic Co. Ltd. v Edison-Bell Consolidated Phonograph Co. Ltd. [1908] 1 Ch. 335.

25 667 So. 2d 696 (Ala. 1995).

26 Describing the observation of Goldberg et al. as “limited” is probably unfair. After all, these authors (writing in 2006) never actually set out, and never could have set out, to consider the ramifications of the insistence upon reliance for the web of protection offered by English common law in the post-OBG v Allan era.

27 The interventionist conception of the economic torts sees their role as being “to provide a remedy for intentional economic harm caused by unacceptable means”: OBG v Allan [2008] UKHL 19; [2008] 1 A.C. 1, at [153], per Lord Nicholls. On this view, only a relatively low threshold need be crossed in order to invoke these torts. By contrast, minimalists think that aggressive, competitive, financially injurious commercial behaviour should ordinarily be tolerated and that protection should be available only on very narrowly defined grounds. Defences of minimalism can be found in the following: Carty, H., “Intentional Violation of Economic Interests: The Limits of Common Law Liability” (1988) 104 L.Q.R. 250Google Scholar and L. Hoffmann, “The Rise and Fall of the Economic Torts” in S. Degeling et al. (eds.), Torts in Commercial Law (Sydney 2001).

28 In saying this, and in line with the law of agency, I regard a misrepresentation made by D to C's agent, but duly passed on to C, as being a two-party case.

29 [1908] 1 Ch. 335.

30 894 F. 2d 28 (2d Cir. 1990).

31 [1908] 1 Ch. 335, 351–52, per Joyce J.

32 [2008] UKHL 19; [2008] 1 A.C. 1, at [47] (emphasis added).

33 Mere potential civil liability towards the intermediary fell within Lord Hoffmann's specific definition of unlawfulness in this context: OBG v Allan [2008] UKHL 19; [2008] 1 A.C. 1, at [49].

34 Another obstacle would be that the dealer almost certainly did not have the requisite intention to cause loss to Mrs. Lipson. On the need for such intention, see OBG v Allan [2008] UKHL 19; [2008] 1 A.C. 1, at [62], per Lord Hoffmann.

35 For this conception of tort law, and details of leading jurists who subscribe to it, see Cane, P., “Reforming Tort Law in Australia: A Personal Perspective” (2003) 27 Melb.Univ.L.Rev. 649Google Scholar, 671.

36 OBG v Allan [2008] UKHL 19; [2008] 1 A.C. 1, at [47]. For detailed analysis of this requirement, see Bagshaw, note 7 above.

37 The term belongs to Carty, note 1 above, p. 95.

38 For the argument that, historically, the “gloss” was not required and that the tort contained only three elements – i.e. intention, unlawful means, and resulting harm – see Stilitz, D. and Sales, P., “Intentional Infliction of Harm by Unlawful Means” (1999) 115 L.Q.R. 411Google Scholar, 436.

39 [2008] UKHL 19; [2008] 1 A.C. 1, at [129]–[136].

40 In view of this, we can dismiss the alternative “gloss” offered by Lord Nicholls in OBG v Allan along the lines that, in addition to the core requirements of (1) intention, (2) unlawful means, and (3) harm, C must also be able to show that he was harmed “through the instrumentality of a third party”: [2008] UKHL 19; [2008] 1 A.C. 1, at [159]. As Lord Walker pointed out, Lord Nicholls's approach would, contrary to authority, usher in a test of simple causation: see ibid., at [269].

41 [2008] UKHL 19; [2008] 1 A.C. 1, at [136].

42 Ibid., at para. [129].

43 Although his Lordship's speech is not crystal clear on the question of whether the liberty of C to deal with the Douglases was being used as a synonym for the more general requirement that there must be an economic interest on the part of C in D, it nonetheless seems the best interpretation of his Lordship having placed such weight upon it. This is because he made clear the fact that the unlawful means tort would not be available to anyone who merely suffered loss by virtue of “acts which may be unlawful against a third party but which do not affect his freedom to deal with the claimant”: [2008] UKHL 19; [2008] 1 A.C. 1, at [136]. Others who share this interpretation include Carty, note 1 above, pp. 96–98 and Deakin, S. and Randall, J., “Rethinking the Economic Torts” (2009) 72 M.L.R. 519CrossRefGoogle Scholar, 533.

44 [2008] UKHL 19; [2008] 1 A.C. 1, at [269]. Lord Hoffmann was at pains to explain that both RCA v Pollard [1983] Ch. 135 and Oren v Red Box Toy Factory Ltd. [1999] FSR 785 should be understood this way. In both cases, D caused loss to C via a wrong committed to an intermediary but only in a way that “did not interfere with the [intermediary's] liberty of action with respect to the plaintiff”: ibid., at para. [53].

45 [1990] 2 Q.B. 479. Lord Hoffmann specifically made clear that he saw this case as falling within the purview of the unlawful means tort in OBG v Allan [2008] UKHL 19; [2008] 1 A.C. 1, at [50].

46 Deakin and Randall, note 43 above, p. 532.

47 In Douglas itself, C did not ultimately go without a remedy since an action for breach of confidence was available.

48 These include E.J. Weinrib, The Idea of Private Law (Cambridge, Mass. 1995), 1–2; Stevens, note 11 above, p. 173; N.J. McBride and R. Bagshaw, Tort Law (London 2012), 9–13.

49 B.C. Zipursky, “Civil Recourse and the Plurality of Wrongs: Why Torts are Different” [2014] New Zealand L.Rev. 145, 149.

50 See e.g. Weinrib, note 48 above, pp. 12–14; A. Beever, Rediscovering the Law of Negligence (Oxford 2007), 24.

51 The loss suffered is typically of the economic variety; and there is no right to economic welfare generally recognised by tort law. Furthermore, the size of the gap must not be over-estimated. Lies designed to secure a competitive advantage over C, as in Lonrho v Fayed, might well result in liability for malicious falsehood: Wilts United Dairies v Robinson [1957] R.P.C. 220, 237.

52 For a powerful defence of this norm, see Goldberg, J.C.P. and Zipursky, B.C., “Torts as Wrongs” (2010) 88 Texas L.Rev. 917Google Scholar.

53 For a range of examples, see Murphy, J., “Rights, Reductionism and Tort Law” (2008) 28 O.J.L.S. 393Google Scholar; Goudkamp, J. and Murphy, J., “Tort Theories and Tort Statutes” (2014) 131 L.Q.R. 133Google Scholar, 147–49.

54 That there is, more generally, a need for relational wrongdoing in this area is in part borne out by the fact that an infringement of the Restrictive Trade Practices legislation does not ground an action for breach of statutory duty. The absence of such an action can be explained by reference to the fact that an infringement of the legislation does not involve the commission of a relational wrong towards someone else. Cf. Hazel Carty's explanation: that these regulatory (i.e. minor criminal law) wrongs afford no tort action because the economic torts are “simply [about] widening the parties to a civil action”; and because the economic torts are parasitic upon some other form of wrong “already recognized by the civil law” (Carty, note 1 above, p. 174). This explanation fails because it is circular. It presupposes the very thing in issue: whether the commission of a regulatory wrong can provide a basis for a claim in tort. On Carty's analysis, the reason why breach of the legislation does not ground a civil action is because the breach of the legislation does not ground a civil action.

55 For a wonderful, if brief, exploration of the extent to which tort law is rightly characterised as incoherent, see Goldberg, J.C.P., “Ten Half Truths About Tort Law” (2008) 42 Valparaiso U.L.Rev. 1221Google Scholar, 1222–24.

56 See D. Ibbetson, A Historical Introduction to the Law of Obligations (Oxford 1999), 84–85; Carty, note 1 above, p. 182.

57 See especially, Stevens, note 11 above; Goldberg and Zipursky, note 52 above. But note that there is a world of difference between (correctly) stating that that tort law is not best seen as being loss-based and (incorrectly) saying that there are no loss-based torts. For examples of certain loss-based torts, see Murphy, note 53 above.

58 Carty (note 1 above, p. 188) erroneously attributes this interpretation to the speech of Lord Blackburn in Smith v Chadwick (1884) 9 App. Cas. 187, 190. However, his Lordship – whose speech only begins at p. 192 – never actually said this. The closest that he came to such a remark was when he said “[w]hatever difficulties there may be as to defining what is fraud and deceit, I think no one will venture to dispute that the plaintiff cannot recover unless he proves damage”: ibid., at p. 195. The exact same mistaken attribution appears in Jones (ed.), note 11 above, p. 1311.

59 In the wholesale review of the economic torts undertaken in OBG v Allan, Lord Hoffmann reiterated that C must have suffered tangible loss before she will be able to invoke the tort of deceit: [2008] UKHL 19; [2008] 1 A.C. 1, at [49].

60 On this model, “the defendant should be liable where he is at fault for causing the claimant loss unless there is a good reason why not”: Stevens, note 11 above, p. 1.

61 Ibid., at p. 8.

62 Ibid., at p. 89.

63 Explicit recognition of this apparent floodgates problem can be found in Goldberg, J.C.P. and Zipursky, B.C., “The Fraud on the Market Tort” (2013) 66 Vanderbilt L. Rev. 101Google Scholar, 117–18.

64 Stevens, note 11 above, ch. 14.

65 Ibid.

66 [1897] 2 Q.B. 57.

67 Ibid., at p. 58.

68 The case also reinforces the point made earlier regarding the need for reliance rather than causation simpliciter since C's illness was directly caused by the substance of D's message rather than by her acting in reliance on what was said to her.

69 The action on the case itself evolved from the early law of covenant, but this is immaterial for present purposes.

70 See S.F.C. Milson, Historical Foundations of the Common Law (Oxford 1981), 300–05.

71 Goldberg, Sebok, and Zipursky, note 23 above, p. 1011. Although the talk here is of the “wrong of interfering with a particular interest of the victim”, it is clear from the authors' other work that they consider the wrongs of tort law to be rights infringements: see e.g. Goldberg and Zipursky, note 52 above.

72 In Derry v Peek (1889) 14 App. Cas. 337, 374, Lord Herschell laid down the test, still applied today, that only a misrepresentation that “has been made (1) knowingly, or (2) without belief in its truth, or (3) recklessly” will be caught by the tort.

73 Writing about exchange settings, the authors state that, “it is not obvious to us that this sort of case exhausts the domain of fraud”: Goldberg, Sebok, and Zipursky, note 23 above, p. 1011.

74 [1991] 2 All E.R. 733.

75 Ibid., at p. 467. Essentially the same reasoning underpins the decisions in Clef Acquitaine S.A.R.L. v Laporte Materials (Barrow) Ltd. [2001] Q.B. 488 and Parabola Investments Ltd. v Browallia Cal. Ltd. [2010] EWCA Civ 486; [2011] Q.B. 477.

76 Logical limits are one thing, while specifically stipulated limits are another. So, e.g. it has been suggested that in Australia deceit is specifically excluded from the matrimonial setting by virtue of the Family Law Act 1975 (Cth.), see Magill v Magill [2006] H.C.A. 51, at [87], per Gummow, Kirby, and Crennan JJ. It is clear, however, that no such exception exists in the matrimonial setting in either England or Canada: see Beyers v Green [1936] 1 All E.R. 613 and Graham v Saville [1945] 2 D.L.R. 489, respectively.

77 [1897] 2 Q.B. 57, 58 (emphasis added).

78 In Dobbs's view, it is “a stand-alone economic or commercial tort that causes financial harm without causing physical harm either to person or to property”: D.B. Dobbs, The Law of Torts (Minn. 2000), 1344.

79 E.g. in Dura Pharmaceuticals, Inc. v Broudo 544 US 336, 343 (2005), the court stated that “the common law has long insisted that a plaintiff … [must show] that he suffered actual economic loss”.

80 Many other leading textbooks on tort law also run the risk of creating the impression that deceit is an economic tort: C. Witting (Street on Torts (Oxford 2015), ch. 14), McBride and Bagshaw (note 48 above, ch. 24), and S. Deakin et al. (Tort Law (Oxford 2012) ch. 5) all present the tort of deceit under either the heading “economic torts” or “protection of economic interests”.

81 See e.g. Perrett v Collins [1998] 2 Lloyd's Rep. 255; Prescott v Lancashire United Transport Co. Ltd. [1953] 1 W.L.R. 232.

82 Allan v Ellis & Co. [1990] 11 E.G. 78.

83 Shelley v Paddock [1980] Q.B. 348.

84 Mafo v Adams [1970] 1 Q.B. 548.

85 See Murphy, note 20 above.

86 Although, leading textbooks generally package deceit alongside other, specifically economic torts, none of them make Dobbs's mistake of suggesting that the tort can only be invoked in connection with the protection of commercial interests. They all at some point acknowledge – though typically in the footnotes – that deceit is also capable of providing a remedy in respect of non-economic, consequential losses.

87 Stevens, note 11 above, p. 297. Carty, also, has engaged with the absence of any clear, unifying rationale behind the economic torts: see H. Carty, “The Modern Functions of the Economic Torts: Reviewing the English, Canadian, Australian and New Zealand Positions” [2015] C.L.J. 261.

88 Wedderburn, Lord, “Rocking the Torts” (1983) 46 M.L.R. 224Google Scholar, 229.

89 See e.g. Carty, note 87 above.

90 Like deceit, intimidation is (these days at least) a purely two-party tort. If D intimidates T so as to cause loss to C, C's action must now be framed in terms of the unlawful means tort: OBG v Allan [2008] UKHL 19; [2008] 1 A.C. 1, at [6]–[7], [47], per Lord Hoffmann.

91 As to the reasons why these two torts may fairly be considered anomalous, despite both standing on House of Lords authority, see note 20 above. And on the tension between them and the OBG v Allan tort, see Carty, note 87 above.

92 [1979] Q.B. 333, 349.

93 [1997] A.C. 254.

94 Standard Chartered Bank v Pakistan National Shipping Corp. & Others (Assessment of Damages) [2001] EWCA Civ 55; [2001] 1 All E.R. (Comm) 822, at [39], per Potter L.J.

95 The Liverpool (No 2) [1963] P. 64, 77–78.

96 Alliance & Leicester Building Society v Edgestop Ltd. [1993] 1 W.L.R. 1462; Standard Chartered Bank v Pakistan National Shipping Corp. (No. 2) [2002] UKHL 43; [2003] 1 A.C. 959.

97 See e.g. P. Cane, Atiyah's Accidents Compensation and the Law (Cambridge 2006), 53, note 40; J. Goudkamp, “Rethinking Contributory Negligence” in E. Chamberlain et al. (eds.), Challenging Orthodoxy in Tort Law (Oxford 2013).

98 In making this claim, I do not mean to suggest that the only difference between contributory negligence and the mitigation rule is a temporal one. For example, as Goudkamp (ibid., at p. 332) has observed, contributory negligence involves division of total loss whereas the mitigation rule involves subtraction of certain additional losses from the overall loss. Also, whereas acts of contributory negligence can only ever reduce the amount to which C is entitled by way of damages, acts of mitigation that cost C money can sometimes add to the recoverable loss in respect of which C claims: see Nolan, D., “Preventive Damages” (2016) 132 L.Q.R. 68Google Scholar, 71. Importantly, however, neither of these differences undermines the present point, which is simply that the rationale for both rules is identical: an objectively unreasonable lack of self-regard on the part of C which augments his losses ought for that reason to be borne by C.

99 The Act is often criticised on the basis that it does not specify precisely how apportionment must be undertaken, and because it fails to define the pivotal concept of contributory negligence. But for a more fundamental attack see R. Stevens, “Should Contributory Fault be Analogue or Digital?” in A. Dyson et al. (eds.), Defences in Tort (Oxford 2015).

100 Co-operative Group (CWS) Ltd. v Pritchard [2011] EWCA Civ 329; [2012] Q.B. 320, at [29]–[32].

101 If the whole of C's loss is attributable to C's foolhardy, post-tort conduct, C's conduct is appropriately characterised as a novus actus interveniens rather than as a failure to mitigate loss: see e.g. McKew v Holland and Hannen and Cubitts (Scotland) Ltd. [1969] 3 All E.R. 1621.

102 G. Williams, Joint Torts and Contributory Negligence (London 1951), 198.

103 Alliance & Leicester Building Society v Edgestop Ltd. [1993] 1 W.L.R. 1462, at 1474, per Mummery J.

104 Goudkamp, J., “Contributory Negligence and Trespass to the Person” (2011) 127 L.Q.R. 519Google Scholar, 520.

105 For a comprehensive destruction of Williams's reasoning in these respects, see Goudkamp, ibid., at pp. 520–21. Only Goudkamp's most devastating arguments are invoked here and applied to the tort of deceit.

106 [1964] A.C. 1129. The exemplary damages riposte is further undermined, in the modern era, by the fact that the 1945 Act has no purchase with respect to exemplary damages: it applies only to the parties' respective shares in the “responsibility for the damage”. And since the damage suffered can only ever be cashed out in terms compensatory, not punitive, damages, it follows that 1945 Act cannot be applied to exemplary damages.

107 Williams, note 102 above, p. 198. This argument is obviously similar to, yet subtly different from, the historically grounded argument about D not being entitled to a defence where D acted deliberately and C had only negligently contributed to his own loss. In that context, however, the principal objection was anchored to D having a complete defence.

108 Corr v IBC Vehicles Ltd. [2008] UKHL 13; [2008] 1 A.C. 884.

109 See Goudkamp, note 104 above, p. 521.

110 This is the Hegelian view of deceit, supported by Beever, Allan in his “The Structure of Aggravated and Exemplary Damages” (2003) 23 O.J.L.S. 87Google Scholar, 89.

111 Derry v Peek (1889) 14 App. Cas. 337, 376, per Lord Herschell.

112 Authorities to this effect include Pilmoore v Hood (1838) Bing. N.C. 97; Redgrave v Hurd (1881) 20 Ch. D. 1; Dobell v Stevens (1825) 3 B. & C. 623. In one Australian case, it was even held that C was entitled to sue despite knowing that D's statement was not entirely true: see Gipps v Gipps [1978] 1 N.S.W.L.R. 454.

113 See Gran Gelato Ltd. v Richclif (Group) Ltd. [1992] Ch. 560, 574, per Sir Donald Nicholls V.-C.

114 Were this not so, D would have no need of a defence.

115 If the hypothetical in the text is thought rather fanciful, it is noteworthy that one need only modify slightly the facts of Schneider v Heath (1813) 3 Camp. 506 in order to see another such example. In that case, D floated a ship in order to conceal faults that existed below the waterline. If C bought the ship, ignorant of the defects, and then (although not obliged or induced to do so) foolishly put the ship to commercial use without checking its seaworthiness with the result that the ship sank, there would presumably be a good case for arguing that C's contributory negligence caused the additional loss.

116 In Standard Chartered Bank v Pakistan National Shipping Corp. (No. 2) [2002] UKHL 43; [2003] 1 A.C. 959, the House of Lords specifically confirmed the reason given in the text for the non-applicability of the 1945 Act to deceit cases.

117 For details of these cases, and for a set of pragmatic arguments about how best the doctrine should be confined in its extension to the intentional torts, see McNicholls, W.J., “Should Comparative Responsibility Ever Apply to Intentional Torts?” (1984) 37 Oklahoma L.Rev. 641Google Scholar, 644–45.

118 The need to show reliance, recall, ensures that deceit conforms to the structural norm of tort law. Abandoning the reliance component would therefore come at high cost in terms of tort law's coherence. I doubt whether this is a cost worth paying in order to plug a small, remedial gap in the common law.