Esso Petroleum Co Ltd v Mardon

Esso Petroleum Co Ltd v Mardon [1976] EWCA Civ 4 is an English contract law case, concerning misrepresentation.

Mr Mardon was buying a petrol station franchised by Esso Petroleum Co Ltd. Esso told him they had estimated that the throughput of a petrol station in Eastbank Street, Southport, would be 200,000 gallons a year; however, the local council had made a decision regarding planning permission which meant that there would be no direct access from the main street and therefore fewer customers.

From 1964, Mr Mardon negotiated a lower rent with Esso but was still losing money.

Lawson J held there was no contractual warranty and damages for negligent misstatement were limited to losses before 1964.

It was argued that when a contract resulted, there was no tort liability, relying on Clark v Kirby-Smith,[1] when Plowman J said a negligent solicitor was not liable in tort, only contract, based on Sir Wilfrid Greene MR in Groom v Crocker.

[3] There is a duty to negotiate with care, if a man, who has or professes to have special knowledge or skill, makes a representation by virtue thereof to another… with the intention of inducing him to enter into a contract with him, he is under a duty to use reasonable care to see that the representation is correct, and that the advice, information or opinion is reliable.'