Citizens Assurance Co Ltd. V. Evatt (1971) AC 793

The appeal case of Mutual Life and Citizens’ Assurance Co Ltd v Evatt (1971) AC 793 (Mutual Life) was allowed on the basis of three issues including if the appellant had the competency to give this advice, if innocent misrepresentation is negligent and if there was an element of reliance by the respondent on this information. The interpretation of these factors determined the appellant owed no duty of care and was not liable for the respondent’s monetary loss.
The first issue was if the appellant owed a duty of care in giving advice to the respondent. It was decided that as the appellant must have special skill or competence to owe a duty of care to another. Referring to Shiells v Blackburne (1789) 1 H.B1. 158, a person acted graciously and who, did not engage in the profession, did not have a duty to demonstrate competence. It similarly applied that the person must only demonstrate a degree of competence in relation of a duty of honesty. As the appellant was not a professional in giving investment advice and were giving gracious information, no duty of care arose. As the appellants did not have this competency, nor portrayed themselves as having such skill and confidence, they could not be reasonably expected to have knowledge that their advice would result in the plaintiff’s loss.
The fact that the innocent …show more content…
The council owed a duty of care because it had the competence and skill required, as it was the council for the area, and the only entity which would have access to this information, and was to provide this information to those who required it. In Mutual Life Evatt had no reason to believe that Mutual life had any skill in advising on