Woolcock Street Investments Pty Ltd v CDG Pty Ltd

In Woolcock Street Investments Pty Ltd v CDG Pty Ltd, the High Court of Australia considered whether an engineer owed a duty of care to a subsequent purchaser of commercial premises to prevent pure economic loss arising from defects in the building's construction. The appellant, Woolcock Street Investments Pty Ltd, had purchased commercial premises and alleged that it suffered economic loss due to defects in the building's design and construction, for which the respondent, CDG Pty Ltd, was responsible.

The central legal issue before the Court was whether the principles established in *Bryan v Maloney*, which held that a builder owes a duty of care to a subsequent purchaser of a dwelling house to avoid reasonably foreseeable economic loss from latent defects, extended to commercial premises. The Court was required to determine if there was a difference in principle between residential and commercial buildings in the context of a builder's or designer's duty of care to subsequent purchasers.

The Court reasoned that while *Bryan v Maloney* established a duty of care in the context of residential dwellings, it did not extend this duty to commercial premises. The majority distinguished the factual context of the present case from *Bryan v Maloney*, noting that the principles applicable to negligently inflicted pure economic loss had evolved. They concluded that neither the principles applied in *Bryan v Maloney* nor subsequent developments supported the appellant's contention that the respondent owed it a duty of care. The Court found that foreseeability of economic loss was a necessary but not sufficient condition for recovery, and that additional factors such as vulnerability, assumption of responsibility, or known reliance were not present in a way that would establish a duty of care to a subsequent purchaser of commercial property.

The High Court dismissed the appeal with costs.