THE EVOLVING CONCEPT OF GROSS NEGLIGENCE
The concept of ‘gross negligence’, if not necessarily the meaning, is familiar to lawyers. Transactional lawyers regularly come across the term in contracts, often in the context of an exclusion clause (and normally, as a carve out from the exclusion) or indemnity provisions.
Equally, disputes lawyers are often asked to advise on liability for potential gross negligence claims arising out of contracts. Commonly, the concept of gross negligence will not be defined in the agreement itself, no doubt in part because it is difficult to particularise the full gamut of potentially gross negligent scenarios which could arise.
In the absence of a contractual definition, parties must rely on courts to provide guidance on how to interpret the term.
So what is gross negligence? It is clearly more serious than ordinary negligence, but what is the threshold that elevates negligence to it being ‘gross’ and what other considerations may be relevant? While it is fair to say that ‘gross negligence’ has been somewhat of a nebulous concept, the recent High Court decision of Federal Republic of Nigeria v JP Morgan Chase Bank (2022) provides further guidance on the approach the courts will take when interpreting this term.
The court’s attempts to articulate ‘gross negligence’
Any discussion of this topic usually starts by noting that there is no concept of gross negligence in English law distinct from negligence, as reflected in the oft-cited 1843 decision in Wilson v Brett, which concluded that gross negligence is simply negligence with a “vituperative epithet”. This differs from the position in other jurisdictions, such as Germany, which distinguish between negligence and gross negligence.
Oct-Dec 2022 issue
Humphries Kerstetter