Hedley Byrne & Co Ltd v Heller & Partners Ltd [1963] UKHL 4 (28 May 1963)

HEDLEY BYRNE & CO LTD v HELLER & PARTNERS LTD [1963] UKHL 4; [1964] AC 465 House of Lords 28 May 1963

Judges: Lord Reid, Lord Morris of Borth-y-Gest, Lord Hodson, Lord Devlin, Lord Pearce

Facts

Hedley Byrne, advertising agents, asked their bank to obtain a credit reference on a client, Easipower, from Easipower's bank, Heller. Heller replied "without responsibility" that Easipower was respectable and good for its ordinary business engagements. Hedley Byrne relied on the reference, extended credit, and lost money when Easipower went into liquidation. They sued Heller for negligent misstatement.

Held

The House of Lords held that a duty of care could arise for negligent statements causing pure economic loss where there was a special relationship. On the facts, however, the disclaimer "without responsibility" meant that Heller had not assumed responsibility, and the claim failed.

Key Principles

1. A duty of care can arise for negligent misstatements causing pure economic loss.

2. The duty arises where there is a special relationship and an assumption of responsibility.

3. A clear disclaimer can prevent the assumption of responsibility.

4. The case opened the law of negligence to pure economic loss, subject to later limits.

Why It Matters in Sierra Leone

Hedley Byrne is persuasive authority in Sierra Leone on negligent misstatement, bankers' references, and the effect of disclaimers. It is cited in commercial and professional negligence claims where the loss is economic rather than physical.