Description
The claimant had wanted to invest the proceeds of the sale of his home while he searched for a new property. He told his financial adviser that he wanted ready access to his money. He did not want any risk to his capital. He was advised to invest in an insurance-based bond on the basis that this was as safe as having cash in a deposit account. At first instance the judge found that the advice was negligent, but that the loss suffered on his capital arose out of unprecedented market turmoil which was unforeseeable and too remote to allow recovery in tort and nothing more than nominal damages in contract. The Court of Appeal overturned the decision finding that the loss of capital from market movements was foreseeable and a danger the investor had specifically wanted to guard against.
