X manufactured dodgy engines and their engines were sold by retailers to P. D bought X’s business. The dodgy engines caused economic loss to P who sued D for not warning them that the engines were dodgy, as D had discovered. CA held that neither a manufacturer nor a person who took over a manufacturer. The question is “whether there was a special relationship of proximity imposing a duty on the defendant to safeguard the plaintiffs from economic loss” (Tuckey LJ) and this was not the case here (the purchaser and manufacturer had no dealings with one another). In general manufacturers owe no duty to remote purchasers to avoid causing them economic loss. Only exceptionally could a manufacturer assume such a duty.
