Pure economic loss

In Malaysia, the Federal Court in Majlis Perbandaran Ampang v Steven Phoa Cheng Loon [2006] 2 AMR 563 followed the decision in Caparo Industries v Dickman [1990] UKHL 2 where it held; pure economic loss is claimable if 1) the damage was foreseeable, 2) the relationship between the parties was one of sufficient proximity, and 3) it is fair, just and reasonable to impose a duty of care on the defendant.

In the case of Tenaga Nasional Malaysia v Batu Kemas Industri Sdn Bhd & Anor Appeal [2018] 6 CLJ 683, the Federal Court has reaffirmed the position of the Caparo's three-fold test.

[20] The product liability form of the rule (i.e., that there is no recovery for pure economic loss under a theory of strict product liability) can be traced back to Roger Traynor's decision in the California case Seely v. White Motor Co. (1965), which was later adopted by the Supreme Court of the United States in East River Steamship Corp v. Transamerica Delaval Inc.

[24] The general rule of tort liability under German law is supplied by section 823 of the Bürgerliches Gesetzbuch (BGB), which does not provide for damages for pure economic loss.

[25] However, the courts have interpreted BGB provisions imposing liability for harms caused by actions contrary to public policy or statute to allow for pure economic loss damages.

[29] However, in more recent decades, some Swedish court decisions have allowed damages for pure economic loss in exceptional circumstances even when there is no underlying crime.