Henderson v Merrett Syndicates [1995] 2 AC 145

Members of Lloyd's insurance syndicates, known as Names, alleged negligent underwriting management by agents responsible for the syndicates' business. The contractual arrangements differed: some members dealt directly with managing agents, while others participated through intermediate agents. Those differences raised questions about whether tort duties existed alongside the contracts and extended to members without a direct contract with a particular managing agent. The proceedings concerned responsibility for professional services and economic loss, rather than merely the careless drafting of a single contract. The scope of the agents' undertaking was central to the duty question.

• The issue in the case was, inter alia, whether a duty of care was owed by the managing agents in tort

The House of Lords held that the managing agents owed duties in tort to both direct and indirect members of the syndicates. Their professional undertaking and assumption of responsibility supported a duty concerning the performance of the underwriting services. Contractual arrangements did not automatically exclude the parallel tort duty, and the absence of a direct contract did not automatically prevent it. The actual terms and allocation of responsibility nevertheless remained relevant: a claimant could not use tort simply to contradict contractual limitations. The decision therefore recognised concurrent responsibility in the relationships before the court, rather than an unrestricted choice to disregard contracts whenever a negligence claim seems more advantageous.

A professional's assumption of responsibility for services can create a tort duty concerning economic loss, including where contractual relationships also exist. Concurrent tort liability is possible but must respect the actual contractual allocation of responsibility and cannot simply contradict it.

Henderson extends Hedley Byrne beyond statements to the provision of services and rejects a rigid division between contract and tort. It is useful where several professional relationships overlap and some claimants lack a direct contract with the defendant. The decision does not permit a claimant to ignore contractual limitations which define or exclude responsibility. An examination answer should identify the undertaking, the claimant to whom it was owed and the effect of the contractual structure.