P’s cargo was loaded onto a ship which, after inspection by a Surveying Society’s inspector, was allowed to put to sea and sank. In addition to settling with the ship-owners, they sued the inspector for negligence. HL dismissed the claim. It held that in deciding whether to impose a duty of care, it had to consider the elements of foreseeability and proximity and whether it was fair, just and reasonable to impose a duty of care on the defendant. In this case the society undertook, for free, an expense that would otherwise have to be taken on by states and therefore it would be unfair, unjust and unreasonable to impose the duty of care on it.
Lord Steyn (with majority): He says that although there is no evidence to support a charitable society having a general immunity from prosecution, it’s public benefit should make one hesitant about imposing duties on it. Liability would expose societies to too great a risk. Furthermore, since it was the ship-owner’s who decided to use the society to comply with rules on protecting the cargo and NOT the stock-owners (who had no idea of the involvement of the society initially), it would be unfair to make the society liable to P.