Pure economic

Pure economic in United States

Pure economic 

Pure economic loss has been defined as “damages for inadequate value, costs of repair and replacement of the defective product or consequent loss of profits–without any claim of personal injury or damages to other property . . . .” ‘ [Citations.]” (Sacramento Regional Transit Dist. v. Grumman Flxible (1984) 158 Cal. App. 3d 289, 294 [204 Cal. Rptr. 736].

In cases of strict products liability the tort feasor will be held liable for direct injuries to the person but not for purely economic injuries i.e. torts where there is no injury to the person. The difficult cases are where there is damage to corporeal property but no personal injury. There the line between contract (economic loss) and tort (material damage) proves hardest to draw. Decisions generally allow recovery for consequential corporeal property damage. Seely v. White Motor Co. (1965) 63 Cal. 2d 9 [45 Cal. Rptr. 17, 403 P.2d 145]

In negligent torts the liability of a manufacturer will be limited to physical injuries and possibly also property damage, i.e. corporeal damages. No recovery for purely economic losses is. Wyatt v. Cadillac Motor Car Division, 145 Cal. App. 2d 423, 426, 302 P.2d 665, disapproved on other grounds in Sabella v. Wisler, 59 Cal. 2d 21, 31, 27 Cal. Rptr. 689, 377 P.2d 889. (Dicta).

The difficult issue is whether property damage should be compensated and if so whether consequential damages arising out of property damage should be compensated.

The issue of consequential damages for a tort arises out of eight possible basic cases:

Strict       Negligence
Liability
I) Personal Injury
II) No Personal Injury
III) Corporeal Property Damage
IV) No corporeal property damage

Any of these eight cases can be litigated under a theory of tort or breach of contract. In theory purely economic losses will be recovered under a theory of warranty and personal injury or corporeal property damage will be remedied under a theory of tort. The confusion arises however – aside from the variety of possible fact patterns – in the case of consequential damages. The best guiding principle is that contractual losses are governed by the theory of contractual freedom: that parties to a contract can negotiate the terms thereof. Thus under a theory of contract a plaintiff would not be able to recover for their economic losses due to understimating the economic worth of their bargain. In contrast tort’s are predicated upon a non-consenting relationship. Thus where there is an injury to the person, and even to the persons property, they should be allowed the consequential damages flowing therefrom. However concerns over adequate compensation of plaintiffs and deterrence of defendants lurk behind these principles. The case law in this field is in fact contradictory, see e.g. J’Aire Corp. v. Gregory (1979) 24 Cal. 3d 799 [157 Cal. Rptr. 407, 598 P.2d 60].
Loss of Consortium : Verlust des Liebespartners

The right of a spouse to an award of damages for the loss of services and affection in cases where their spouse was the victim of a tort; Abgeleitete Anspruch des Ehemanns im Fall der Tötung oder Verletzung seiner Ehefrau.


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