Assumption of Responsibility and Loss of Bargain in Tort Law

The author seeks to justify recovery in negligence law for loss of bargain, which is the pure economic loss incurred by a subsequent purchaser of a defective product or building structure in seeking to repair the defect. The difficulty is that the purchaser is not in a relationship of contractual privity with the manufacturer The conflicting approaches in Anglo-American tort law reveal confusion, owing to loss of bargain's dual implication of the law governing pure economic loss and products liability. These difficulties are overcome by drawing from Hedley Byrne's requirements of a defendant's assumption of responsibility and a plaintiff's reasonable reliance, and by casting the damaged interest as that of the plaintiff's own autonomy. In doing so, the doctrine of assumption of responsibility is encapsulated, and the case for its extension to loss of bargain cases is made with reference to early U.S. products liabilityjurisprudence.