Was this the most important court decision of the 20th Century?

Today, May 26 2012, is the 80th anniversary of what (to me) is the most important judgment to the insurance industry delivered in the 20th Century.  While this case is introduced in the most basic of law studies, many fail to appreciate the momentous change that the decision heralded.

While five Law Lords of the English House of Lords decided the case, the ruling by one, an Australian by birth, is what, in effect, changed the law on negligence so dramatically.

The case itself was over such as a humble matter involving a claim for only £500. It was brought by an impoverished single mother, and part-time shop assistant, who did not have £5 to her name outside her clothes and the action itself. In other words, a pauper in the eyes of the law.

Background

On the 26th August 1928, Mrs May Donoghue (nee McAllister), who resided at the time with her brother in Kent Street Glasgow, was invited by a female friend to a night out at the Wellmeadow Cafe, Paisley.

Mrs Donoghue’s host ordered the popular ginger beer floater. This was a large tumbler with 2 or 3 scoops of ice cream. The owner, Mr Francis Minchella, then filled the glass of ice cream with ginger beer from a black glass bottle supplied by the nearby drink maker, D. Stevenson. Stevenson’s factory was only 600 metres from the café in Glen Lane, Paisley.

The ever-attendant owner of the café, Mr Minchella, returned and topped up the glass and as he tipped up the bottle (what is described as) a decomposed snail fell into the glass.

The best known photograph of the Wellmeadow Café.

Mrs Donoghue was extremely upset and later complained of stomach pain and 3 days later she visited her doctor who diagnosed her as having gastroenteritis and being in a state of severe shock. She later attended the Glasgow hospital as she did not fully recover from the initial visit to her doctor.

How the snail got into the bottle is not explained in the court documents but in his submission, the lawyer acting for Mrs Donoghue, states that snails and the tracks of snails can be seen at the factory operated by Stevenson. I would expect that the snail has got into the empty bottle while it was sitting the yard waiting to be filled.

The Law at this Time

Up until this point in time, the law was such that only where there was a contract between the manufacturer and consumer. In fact, only 3 weeks before, the same lawyer, Walter Leechman of W G Leechman & Co, situated less than 1 mile from Mrs Donoghue’s brother’s home, who ultimately agreed to take on Mrs Donoghue’s case had failed in two similar cases where it was alleged that a mouse was found in a bottle of a fizzy drink. These were Mullen v. Barr & Co. Ltd.  & M’Gowan v. Barr & Co. Ltd. ([1929] S.C. 461).

The man who believed in social justice, lawyer Walter Leechman

Lord Norman acted as trial counsel for Mr David Stevenson and asked that the matter be thrown out of the courts on the grounds that it showed no course of action. In the Court of Session (the first court to hear the matter) the Lord Ordinary, Lord Moncrieff, disagreed and found in favour of May Donoghue. But, on appeal,  Stevenson  won 3 – 1 in the Second Division with the majority of judges following their own decision in Barr judgments. In effect, they reaffirmed their earlier position that that the manufacturer of the soft drink owed no duty of care to the end consumer; only to the person such as the café owner or shop keeper. Interestingly, in both cases the single judge in the first instance found in favour of the claimants.

With consumer protection laws the way they are today, it staggers me that this was the position in the United Kingdom, Australia, New Zealand, Canada and the United States at the time that my own father was born.

For the law to have been challenged toward the consumer during the great depression is equally of interest and demonstrates the depth of feeling of Leechman for social justice.

The Legal Obstacle to Overcome

In summary:

  • Although there was a contractual  relationship between the café owner and  Ms Donoghue’s friend, the friend had not been harmed by the ginger beer.
  • No contract existed between café owner and Ms Donoghue.
  • Ms Donoghue had to prove negligence
  • Café owner Minchella was not negligent, he did not manufacture the drink nor did he fill the bottle
  • Ms Donoghue would have to prove negligence against the manufacturer David Stevenson to obtain any compensation.

What Unfolded

Believing the existing law to be an unjust state of affairs, lawyer Leechman, who must have had a heightened regard for social justice, decided to test the position in the House of Lords.

Despite the importance of the House of Lords, the petition shows McAllister spelt incorrectly!

The document signed by Ms Donoghue stating she is a pauper.

It is my belief that he did not run either the Mullen or M’Gowan matters even though they were similar events as it would have meant the plaintiff would have had to stump up a sizeable amount of funds as security to cover the legal fees of Barr and Co. Ltd. should the appeal fail. By selecting Ms Donoghue’s case and petitioning the court that she be permitted to prosecute her “Appeal in forma  pauperis” [Latin, In the character or manner of a pauper] the need to put up the security was avoided.

Leechman took Donoghue’s case to the House of Lords less than four weeks after he had failed in his attempt to, in his eye right the law, with the two cases against Barr & Co. Ltd. He himself did the case pro-bono and located barristers who also agreed to prosecute the appeal at no cost to Donoghue.

The petition to hear the case was granted by the House of Lords and it went to trial on 9th September 1931. Five Law Lords heard the case. They were Lords Buckmaster, Atkin, Tomlin, Thankerton, and Macmillan. It is Brisbane born Lord Atkin whose judgement changed so dramatically the law of tort.

The Law Lords that heard Donahue v Stevenson. I have circled Brisbane born Lord Atkin

Leechman ran a very narrow argument setting out his belief that a manufacturer that puts a product on the market (in a fashion that it is to be served in the container in which it is sold) has a duty to ensure that it is fit for human consumption (i.e. that it is fit for purpose).

I am not sure if Leechman was aware of it, but Lord Atkin had delivered a paper approximately 5 months before in which he set out his position on English Law.

In his talk, Lord Atkin stated that in his opinion: “It has always been the position in English Law that it has ingrained in it the moral sense, that it lays down standards of honesty and plain dealing between man and man.”

He went on to say that: “He is not to injure his neighbour by acts of negligence and that certainly covers a very wide field of the law. I doubt if the whole of the law of tort could not be comprised in the golden maxim to do unto your neighbour as you would have him do unto you’.

The paper that Lord Atkin delivered 5 months before his famous decision in Donoghue v Stevenson

Many believe that Lord Atkin drew his inspiration for this from the Christian parable of the Good Samaritan and this may be correct. The fact is, however, that statements that mirror the do unto others approach to society can be found in virtually every religion. As such, it does have extremely wide appeal.

The Important Ruling

In his written judgment in the Donoghue v Stevenson case, which as I said at the start of this post, he delivered on 26 May 1932 , Lord Atkin started with a summary of the existing law:

If one man is near to another or near to the property of another a duty lies on him not to do that which may cause a personal injury to that other or that may injure his property. “

Lord Atkin, using the concepts that he had outlined in his speech at King’s College London, then merged these with the current legal position and espoused that neighbourhood was a mental rather than a physical state and that those like David Stevenson must have those who use your product in your mind when manufacturing a product.

If one man is near to another or near to the property of another, a duty lies on him not to do that which may cause a personal injury to that other or that may injure his property.”

 He then went on and outlined his famous neighbour principle.

You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour.”

These words have a very broad meaning. For example, a large supermarket opening next to a general store or a large warehouse-style hardware store opening in the same town as a much smaller hardware store will cause the smaller store an “injury”. I return to this point shortly but I would make the point at this time that Lord Atkin’s words state that not only “acts” that can be brought to account but also “omissions” to act. (I started to go off here and explain the difference between nonfeasance and misfeasance but will safe that for next week.)

Nineteen pages later in the ruling written in beautiful English prose, Lord Atkin explained who your neighbour is when it came to exercising reasonable care to protect them.  In this regard, he stated:

Persons work are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so effected when I am directing my mind to the acts of omissions which are called into question.”

 The test was not on the extent of the damage, but whether there was a sufficient proximate relationship to the person suffering a financial loss. Another way of looking at this is that it moved the position of a neighbour from someone who is physically close to you to someone who is or ought to be in your mind.

Significance

The significance of the judgement is that in this one ruling Lord Atkin swept up all the existing torts (a tort being a civil wrong) such as the Tort of Nuisance, the Tort of Trespass, the Tort of Conversation and others and taking what most accept is the great noble idea not to injure your neighbour and created a new general law within English law of the Tort of Negligence. A principle that could be used in any case subject to limits.

Going back to the issue of the opening of a new larger store next to or in the vicinity of a smaller one. There is nothing in Lord Atkin’s judgment that limits a right for damages to only those involving physical damage or injury. Some argued that it applied to pure economic losses as well. The big struggle that continues to this day is to find ways within reason to limit claims for pure economic loss such as the store opening situation and yet provide protection where it is appropriate, for example a dredge digging up an under-sea cable as occurred in the Australian matter of Caltex Oil (Australia) Pty Ltd v The Dredge ‘Willemstad’ [1976] 136 CLR 529 or where a auditor has failed in their duty as was found in Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465.

On the other hand, in our capitalist society you cannot expect people to gratutously not develop new ideas, produce new products, open new factories or shops just because it may hurt a competitor. The bulk of society and the economy would suffer as a result of Lord Atkin’s decision was taken to the extreme.

Initially, in the Anns v Merton London Borough Council [1978] A.C. 728 the House of Lords established a broad test for determining the existence of a duty of care in the tort of negligence and this became known as the Anns test or sometimes the two-stage test. The High Court of Australia disagreed with this approach and would not adopt it. In Canada they did agree with it.

However, in the years that followed the Anns case, the House of Lords backed away from the Anns approach and instead decided on a more category-based reasoning. The test was finally put to rest in the United Kingdom with the case of Murphy v Brentwood District Council [1991] 1 AC 398.

The Canadians, rightly or wrongly, are still relying on the Anns approach.

Lord Macmillians agreed with Atkin and added, as part of his reasons for finding in favour of Donoghue as well, that:

The categories of negligence are never closed.”

With these words, he deserves his share of the credit for changing the law so dramatically and for the ongoing struggle to place reasonable limits – in particular, in cases of pure economic loss.

While Mrs Donoghue was awarded damages, the amount is a pittance compared to the billions of dollars that have since been awarded where the plaintiff has been successful in proving that their someone owed them a duty of care; that the person has breached that duty of care and as a result of that breach they have suffered injury or damage.

Tribute to the Importance of Donoghue v Stevenson

So much has developed from this one case such as the concept of consumerism that in 1990, a Memorial to the case was, unveiled by Lord Mackay of Clashfern in front of legal figures from around the Commonwealth who travelled to the site of Mr Minchella’s cafe.

What I like is that in the park bench beside the memorial, the designers have incorporated bottles.

In yet another twist of fate that threads itself right through this case is the fact that in the Thomas Coates Memorial Church directly across the road from the memorial is a marble monument to the parable to the Good Samaritan that inspired Lord Atkin in the first place.

The fact that I remembered that it is the 80th anniversary of Lord Aitkin’s decision is due to my reviewing this and many other cases in preparation for one of the introductory subjects in the Master of Insurance Law and Practice degree that I am the course director of that will commence in July this year. To learn more of the course, please go to: http://www.vu.edu.au/courses/graduate-certificate-in-insurance-law-and-practice-btip.

Lord Atkin

Baron Atkin in 1939 near the end of his life.

I finish with a quick biography of Lord Atkin. He was born James Richard Atkin on 28 November 1867 of Welsh-born parents in Brisbane.
His father, Robert, with his wife, Mary, came to Australia to operate a sheep station. Atkin’s father was injured in a horse riding accident about one year into the venture and they moved to Brisbane where James and two younger brothers were born.

In 1871, his mother left his father and returned to the Wales with the young Atkin and his two siblings. Atkins father died in Brisbane within a year.

Atkin is regarded as one of two great English judges of the 20th Century (Lord Denning being the other). When I first read Lord Atkin’s judgement in Donoghue v Stevenson (1932) All ER Rep 1 back in my twenties, I immediately understand why he was so rated.

While he only lived in Australia for the first few years of his life, I claim him as ours!

Was the change of law really necessary?

As I was reading all the material on the case, I went to Google Maps and looked at the location of the Bethany Café in Wellmeadow Place, Paisley and also at the location of D. Stevenson’s factory in Glen Lane, Paisley. As the crow flies, they are less than 600 metres apart. The question then raises itself, was not the Bethany Café, and all who visited the establishment, neighbours of Mr Stevenson. If so, the matter should have succeeded under the existing law. In view of the ramifications that Donoghue v Stevenson brought I am glad Lord Atkin did not have access to the internet in his day.

The humble snail that changed the law

 

3 responses to “Was this the most important court decision of the 20th Century?”

  1. Debbie says:

    Very interesting read, thanks Allan.

    Regards,
    Deb

  2. Bob Prescott says:

    Very soon this web site will be famous and getting even more readers due to it”s top rate content.

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