"Liability for breach of contract is distinguished from liability in tort in that: i) the duties are primarily fixed by law, while on contract they are fixed by the parties themselves; and ii) in tort the duty is towards persons generally while in contract is towards a specific person or persons" (Winfield). Discuss. Is it still viable today to maintain a distinction between contract law and tort? A difficulty lies in locating the law of contract within the spectrum of civil obligations. Contract law is in essence based upon the expectation of a binding promise between individuals, on the basis that these expectations should be fulfilled.
Conversely, tort law reflects the principle that a person should be redressed for harm wrongfully inflicted upon them. Current law maintains a distinction between tort and contract as being separate entities with their own criteria, procedures and remedies, although recent case law and statutory provisions are continually eroding the boundary. Tort and contract law would seem to stray into each other's jurisdiction by virtue of restitution. An individual may bring an action from a contractual arrangement between parties of which he is not one, and where the loss is not strictly as a result of breach of contract, e.
g. a mistake of fact; no contractual obligation exists between parties and yet no tort has been committed either. The effect of separating an analysis of the law of obligations into the strands of contract and tort is to create distinctions of duties. The overriding feature of contract that separates it from tort is that such obligations are voluntary agreed by specific persons, whereas civil obligations are overall imposed on people generally by the rule of law. Therefore, the main difference is the idea that formation of a contract requires mutual assent; this concept of agreement has no place in tort.
Professional responsibility is an example which illustrates the above principle. A claim is actionable as a consequence of a specific contract, but also following a general tortious obligation. In Ross -v- Caunters1, the defendant, who was a solicitor, failed to inform a testator that attestation of a will be the spouse of a beneficiary would invalidate any gift to that beneficiary. The plaintiff, whose husband had signed the will, sued the defendant in negligence for her loss under the will.. It can be seen that an individual practicing a chosen profession must do so responsibly, and with due care.
In this sense, the nature of an obligation in contract is to take reasonable care whilst carrying out the terms of that contract. If there is no precedent, courts will generally consider what is good public policy in relation to a proposed duty of care before imposing it upon a defendant. In terms of contract, there is less scope for them to do this – the terms and conditions of the contract define and bind. Obviously, it is in the public interest to enforce a contract where it is just and reasonable to do so, but courts have traditionally had greater difficulty in imposing a duty of care in tort.
In English law, it has been established that it is perfectly possible for a defendant to owe concurrent duties in contract and tort, although a claimant will not receive damages twice over. This is not to say that he will be denied a remedy in tort if he cannot establish a breach of contract, for although duty in tort is owed to persons generally, duty in contract is to specific persons, and so the presence of breach of contract does not entail a breach of a general duty of care.
A duty not to commit tortious acts (after Donoghue -v- Stevenson2) cannot be analogous with a duty not to breach a contract, so it follows that other factors must be considered, such as privity, proximity and reasonable foreseeability. A persuasive judgment on this issue was handed down by Le Dain J in Central Trust Co. -v- Rafuse3: "… a concurrent or alternative liability in tort will not be admitted if its effect would be to permit the plaintiff to circumvent or escape exclusion of limitation of liability for an act or omission which would constitute a tort.
" The House of Lords decided this was the case in Henderson -v- Merrett Syndicates Ltd. 4 where Lloyd's names were able to bring action in tort against member's agents for negligence, although a contract also existed between the parties. It can therefore be shown that the duty to take care in tort law is of the same standard required in performing a contract carefully, although tort implies a much wider scope of duty than may be stipulated in contract. This represents a swing in precedence in favour of claimants, totally contrary to Lord Scarman's decision in Tai Hing Cotton Mill Ltd.
-v- Liu Chong Hing Bank Ltd5. where there was "… no advantage in searching for liability in tort where the parties are in a contractual relationship. " In deciding whether bringing action in tort or contract is likely to be the most successful, the claimant must consider the necessary criteria to satisfy each. To establish a basis for contractual remedies, it must be shown that the defendant breached the express or implied terms of the contract, and the claimant suffered loss as a result.
The most obvious obstacle with this course of action is establishing the existence of a contract; if none can be found, there can be no duty and hence no breach of that duty. However, due to the express terms of a contract, liability may be easier to prove on the balance of probabilities than in tort. In some circumstances, more success may be found by bringing action in tort. The necessary requirements are the claimant's showing they were owed a duty by the defendant, that the defendant failed to fulfil the required standard of care, and that this failure caused loss or damage to the claimant.