ABSTRACT
The distinction between consequential and pure economic loss is illustrated by the case of Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd. In this case, the defendant’s employees negligently damaged a power cable when digging up the road, cutting off the electricity supply to the claimant’s foundry. Where property is damaged by negligence, it is only the owner of the property, or someone with a right to possess the property, that can claim for the physical damage and the consequential economic loss. Pure economic loss can only be compensated in specific circumstances: usually, where the defendant has assumed responsibility and has a duty to protect the claimant from economic loss. Consequential economic loss is loss which is caused by the personal injury or damage to property, and can be recovered as damages in a personal injury or damage to property claim in negligence.
