How a drink in a cafe affects your professional indemnity, 96 years later
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On St Andrew’s Day it seems apt to explore a famous legal case that relates to Scotland, the law of negligence, and my field of work in professional indemnity (PI) insurance.
Nearly 100 years ago (96, to be precise), a woman walked into a cafe. Little did she, or anyone else in this Renfrewshire establishment imagine she was about to create a new legal precedent that would still resonate almost a century later.
What happened?
May Donoghue and a friend were taking refreshments in Paisley, near Glasgow. Donoghue was served (and drank from) a bottle of ginger beer, ordered by a third party, her friend. The drink had been manufactured by D. Stevenson and served by the cafe’s owner. So far, so usual.
That was until the last of the liquid in the opaque brown bottle was decanted into a tumbler – along with the remains of a decomposing snail.
Donoghue reported suffering shock, nausea, and severe gastroenteritis (leading to hospitalisation) after consuming the tainted drink. So it’s perhaps no surprise she felt entitled to compensation for her injuries, and would fight for damages and costs, to the tune of £500.
Was there a negligence law back then?
Let’s look at the law of negligence before this case, and who was owed a duty of care. The important thing is Donoghue was served and supplied via a third party (her friend), and not directly.
Back then, a duty of care was only owed to parties involved in a contract of goods or services. For there to be negligence, one side must have suffered loss or harm caused by the other party.
The crux of the issue here was: how could Donoghue be owed a duty of care by the manufacturer, when there was no contract between them? Under the law at the time, only Donoghue’s friend was owed any duty of care, as she’d bought the drink. So suing without a contract, and for negligence? That was a tall order.
(While there were no rights for a third party without a contract with the party they were claiming against, there were two possible exceptions. These were if the article or product was dangerous in itself, or if the manufacturer knew it was in some way dangerous.)
Donoghue’s dogged determination
The case was first held at the Outer House of the Court of Session in Edinburgh, which deals with large civil claims. The pursuer (Donoghue) had originally won her case here.
However, she lost an appeal made by the manufacturer (Stevenson) at the Inner House of the Court of Session. This was on the basis of common law of negligence in Scotland, that the manufacturer had no duty to a consumer they had no contract with.
Donoghue, unhappy with this outcome and as determined as ever, took her case to the final Court of Appeal for civil matters under Scots law, the House of Lords (now the UK Supreme Court). Five judges reviewed the case (two, Lord MacMillan and Lord Thankerton, being Scottish).
Bear in mind this court also establishes points of law, where decisions reached bind all the courts below it. So it can make decisions on Scots law for civil matters, and on English law for civil and criminal law matters.
How this landmark case would ‘Scottify’ English law
Much of the decisions reached in Donoghue v Stevenson (1932)[1] referred to US and English case law. Macmillan flagged that the court needed to remember that this was a Scottish legal dispute. It was agreed that the decision reached in this case should be applied to Scots law and English law.
As a result, this case was seen as one of the most famous examples of the court having an opportunity for the ‘Scottification of English law’[2].
But the question still remained: how could they reach a decision on whether the defender owed a duty to the pursuer to take care in the eyes of the law, under the circumstances alleged?
The 'neighbour principle'
On this point one of the judges, Lord Atkin, established a neighbour principle. This was that reasonable care should be taken to ‘avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour.’ In law, neighbours were defined as ‘persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so affected’[3].
This meant the manufacturer should have taken reasonable care to avoid the likelihood of a snail getting inside the ginger beer bottle. It didn’t, so in line with the neighbour principle, Stevenson the maker was held to be negligent.
The final, groundbreaking verdict
Donoghue won her final appeal, being seen as closely and directly affected by the manufacturer’s lack of reasonable care in its manufacturing process.
It’s hard to overstate the importance of this case on negligence laws. These laws have continued to develop further over the years, with the assistance of Scottish civil disputes being heard on final appeal at the UK Supreme Court. And these in turn have helped shape how we build professional indemnity insurance today.
Your duty of care – and why PI matters
As a professional, you’ll know the importance of duty of care in your conduct, and acting with reasonable care and skill. Upholding these principles will be key if you need to defend any claim, and if the accuser has evidence supporting their position.
Another takeaway from this case is the importance of having comprehensive PI cover for your profession and services. This insurance protects you financially for claims for loss or damage by third parties that accuse you of negligent professional services or advice.
As devastating as receiving a claim may be, PI is designed to protect you for any errors or omissions you make. You’ll want the widest PI cover available for your profession and circumstances – and to know exactly what is and isn’t covered by your policy.
That’s where we can help. As an independent broker, we’ll answer any queries when you buy your cover, throughout your policy term, and at policy renewal time. We’ll also be on your side during any claims, ready to fight your corner and reach the quickest resolution possible.
(And perhaps one final takeaway: always drink from a glass.)
Latha Naomh Anndra Sona Dhut (Happy St Andrew’s Day).
[1] Scottish Council of Law Reporting, Donoghue v Stevenson.
[2] Lady Hale, Law Society of Scotland Annual Conference 2018, The Contribution of Scottish Cases to Developing United Kingdom.
[3] Lord Atkin, Page 2
Rhuari Noble
Rhuari is a Senior Risk Executive in the Financial Lines Group (Claims) team at Howden, and is based in Perth, Scotland.
