Banca Nazionale del Lavoro SPA v Playboy Club London Ltd & Ors [2018] UKSC 43 (26 July 2018)
Citation:Banca Nazionale del Lavoro SPA v Playboy Club London Ltd & Ors [2018] UKSC 43 (26 July 2018)
Rule of thumb:Where a contract between 2 people provides a report about a person, and a third party obtains this report and relies on it to their detriment because it was faulty, does the third party does not have a right against the original creator of the report? No, there is no proximate relationship between these parties and so the original creator does not have to pay damages.
Background facts:
.
Parties argued:
The bank argued that they did not even know who Playboy were and the privity of contract applied in this scenario.
Judgment:
The Court upheld the arguments of the bank. The bank did not know at the time they made this reference that it would be provided to Playboy - jus quaesitum tertio can only apply in situations like this if the third party are named, either directly or as a specific category, which was not done in this instance. If the party's name or precise category is not provided then there is no jus quasitum tertio and privity of contract applies instead. Playboy were not awarded any damages from the bank.
Ratio-decidendi:
'in the ordinary course where a statement is relied upon by B to whom A has passed it on, the representor owes no duty to B unless he knew that the statement was likely to be communicated to B. That concession was plainly justified. I would go further and say that the representor must not only know that the statement is likely to be communicated to and relied upon by B. It must also be part of the statement’s known purpose that it should be communicated and relied upon by B, if the representor is to be taken to assume responsibility to B... they had no reason to suppose that Burlington was acting for some one else, and they knew nothing of the Playboy Club. In those circumstances, it is plain that they did not voluntarily assume any responsibility to the Club', Lord Sumption.
'must not only know that the statement is likely to be communicated and relied upon ... it must be part of the statement's known purpose', Lord Sumption
Warning: This is not professional legal advice. This is not professional legal education advice. Please obtain professional guidance before embarking on any legal course of action. This is just an interpretation of a Judgment by persons of legal insight & varying levels of legal specialism, experience & expertise. Please read the Judgment yourself and form your own interpretation of it with professional assistance.