Facts
- Accountants negligently prepared a report for a company. The company showed that report to a third party, who subsequently invested and lost money
Issue
- Could the accountants be liable for the negligent preparation to the third party for their loss
Decision
- No liability
Reasoning
- No contract therefore no duty
- Lord Denning dissented, saying there could be a duty if the accountants knew of the transaction (investing) which would result from their statement; in this case they were as they were present at the time the defendant decided to invest
