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13 Ottawa L. Rev. 469 (1981)
Tort or Contract: The Question of Recovery for Economic Loss

handle is hein.journals/ottlr13 and id is 475 raw text is: TORT OR CONTRACT: THE QUESTION OF RECOVERY FOR ECONOMIC LOSS Peter B. A nnis * I. INTRODUCTION In the law of torts independent paths are being followed by two issues which are inextricably intertwined. The first issue, and of late the more prominent, is that of overlaying contract with the tort regime so as to allow recovery in tort, although the duty of care may spring from a contractual relationship. The second, and seemingly more complex question, is that of extending recovery in tort to allow claims in negligence for pure economic loss.' Both issues are topical and have received individual attention and comment.'-2 It is the purpose of this paper to determine whether there is an underlying connection between these two issues when both are raised in the same factual context. As will be seen, an analysis of these two issues when occurring together leads to the conclusion that in Canadian law * Of the Bar of Ontario. Economic loss or financial loss here refers to pure economic loss, which is to be distinguished from economic loss that is consequential upon physical damage. Pure economic loss is that loss which is unrelated to physical damage, be it to persons or property. The general rule is that the scheme of recover)' in tort law does not include claims in negligence for pure economic loss. On the other hand, economic loss claims that are consequential upon physical damage (e.g.. a wage loss claim in a personal injury action) are recoverable in tort if not too remote. This article is concerned only with pure economic loss. 2 On economic loss. see Atiyah. ,Vegligence (aid E'onomic Loss, 83 L.Q.R. 248 (1967): Harvey, Economic Losses and ,Vegligence: The Search ./or a Just Solution, 50 CAN. B. REV. 580 (1972): Stevens. Negligent Acts Cauing Pure Financial Los-%: Pohc% Factors at Work. 23 U. TORONTO L.J. 431 (1973): Solomon & Feldthusen, Recover% Jor Pure Economic Loss: The Exclusionarv Rule, in STUDIES IN CANADIAN TORT LAw 167 (L. Klar ed. 1977): Jolowicz. The Law of Tort and%,ion-Phstcal Loss. 12 J. Soc. Put:. T.L. 91 (1973): Alexander, The Law of Tort and Von-Ph vstcal Loss Insurance .-spects, 12 J. Soc. PUB. T.L. 119 (1973): Cane. PhyNsical Lo5s. Economic Loss and Pro hcts Liability. 95 L.Q.R. 117 (1979): Schwartz. Jurisprudential Developtnent tin tManufac- turers' Liability for Defective Products ll'here the Onli Danta'e is Economic Loss. 4 CAN. Bus. L.J. 164(1980). On tort or contract. see Poulton. Tort or Contract. 82 L.Q.R. 346 (1966); Considine. Some Implications Fron Recent Cases, on the Dlerences Between Tort and Contract. 12 U.B.C.L. REV. 85 (1978): Irvine. Contract and Tort Troubles ..Ihant the Border. 10 C.C.L.T. 281 (1980): Fridman. The Interaction of Tort and Contract. 93 L.Q.R. 422 (1977): Morgan. The Negligent Contract-Breaker. 58 CAN. B. REv. 299 (1980).