Duty of Care by Assumption of Responsibility in Statutory Resource Allocation

Introduction

Barlow & Ors v The Minister for Communications, Marine & Natural Resources & Ors ([2025] IESC 14) is a landmark Supreme Court of Ireland decision delivered on 11 April 2025. It arose from claims by Irish mussel fishermen and aquaculture investors (the “plaintiffs”) that the State (through the Minister and related agencies) negligently managed access to and allocation of the mussel seed resource in Ireland’s territorial waters. Between 2002 and 2004 the plaintiffs invested €14.25 million in new mussel-dredging vessels (60 percent of the vessels’ cost) after encouragement and grant aid from the State and the EU. They built or upgraded vessels purely to dredge mussel seed for on-growing at State-licensed aquaculture sites. From 2005 on, yields collapsed—coinciding with the admission, under a misunderstood “voisinage” arrangement, of large numbers of Northern Ireland–registered vessels to fish the same resource. The plaintiffs lost their businesses and sued for damages on multiple grounds but chiefly in negligence, alleging the State assumed a responsibility to manage the resource with care and allocate seed rationally so as to protect their investments.

Summary of the Judgment

The Supreme Court allowed the plaintiffs’ appeal in principle. It held that public authorities exercising statutory discretions may, in some circumstances, assume a private-law duty of care to specific persons relying on them—creating liability for pure economic loss. The key features were:

• The State actively solicited and enabled private investment in the mussel industry;
• The plaintiffs committed large resources, knew their viability depended on mussel-seed allocations, and the State knew this;
• No express contracts governed allocation, but by their dealings the State implicitly assumed responsibility to manage the resource and allocate seed with care;
• Where a public body assumes such responsibility, a private duty of care can arise even though the power is statutory, subject to it being just and reasonable and not inconsistent with the public law scheme;
• The appropriate standard is whether the authority’s allocation decisions were so irrational as to fall outside the scope of reasonable discretion (mirroring administrative law’s “Wednesbury” unreasonableness standard);
• The plaintiffs may recover “investment losses” (monies expended on vessels, plant and sites) if they prove causation, but not pure lost profits in perpetuity.

The case was remitted to the High Court to determine (1) whether disclaimers in grant offers negated the assumed responsibility, (2) the extent of the plaintiffs’ knowledge of the Northern Ireland arrangements, (3) the precise quantum of investment losses, (4) whether allocations were irrational, and (5) causation between negligent allocations and those losses.

Analysis

Precedents Cited

• Siney v Dublin Corporation [1980] IR 400 – statutory housing inspections created proximity and duty of care to tenants;
• Ward v McMaster [1985] IR 29 – local authority loan-valuation duties led to liability when surveyor’s negligent report caused financial loss;
• Glencar Exploration plc v Mayo County Council [2002] 1 IR 84 – mere exercise of public power for the public benefit does not automatically create private-law duty; proximity and legitimate expectation needed;
• Cromane Seafoods Ltd v Minister for Agriculture [2016] IESC 6 – no duty of care in negligence for adverse administrative closures of fisheries affecting many without special relationship;
• Figary Water Sports Development Company [2015] IESC 74 – negligent processing of a grant application gave rise to duty of care;
• Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465 – duty for negligent misstatement where there is an “assumption of responsibility”;
• Donoghue v Stevenson [1932] AC 562 – seed case for modern negligence principles of foreseeability and proximity;
• Caparo Industries Plc v Dickman [1990] 2 AC 605 – tripartite test of foreseeability, proximity and whether it is fair, just and reasonable to impose a duty;
• Robinson v Chief Constable of West Yorkshire Police [2018] UKSC 4 – affirmed equal treatment of public and private defendants for negligent acts causing personal injury;
• Poole Borough Council v GN [2019] UKSC 25 – public authorities can owe duties if private analogues exist unless expressly excluded by statute.

Legal Reasoning

1. Duty of Care Framework
By analogy to private law, a duty of care arises only if (a) damage was reasonably foreseeable, (b) there was sufficient proximity, and (c) it is fair, just and reasonable to impose such a duty. In “novel” cases not covered by binding precedent, courts develop liability incrementally by analogy, with policy constraints informing the “fair, just and reasonable” limb.

2. Assumption of Responsibility
Where a defendant voluntarily undertakes a task (expressly or implicitly), and knows another will rely on its exercising care, a private duty of care arises for pure economic loss. EU grant-aid application processes, ministerial encouragement, and exclusive control over the mussel-seed resource established a special relationship akin to contract – a “voluntary assumption of responsibility.”

3. Statutory Discretion and Public-Law Limits
Although the allocation power was conferred by statute for the public benefit, the State may assume private duties to particular persons reliant on them, unless that duty conflicts with public-law obligations or inhibits statutory functions. The “just and reasonable” inquiry rejects any immunity for public bodies but requires that imposing a private duty must not curtail lawful public-law discretion.

4. Standard of Care
In cases of purely discretionary decisions, the standard is akin to administrative law’s “irrationality” or “Wednesbury” test: conduct is negligent only if it is so unreasonable (perverse, illogical, or defying common sense) as to be outside the range of choices a reasonable authority could make. Routine professional standards (Bolam) or the reasonable-man test apply to other negligent acts.

Impact

• Expansion of Public Authority Liability – Confirms that public bodies can incur private duties of care by assumption of responsibility even when exercising statutory discretion, subject to reasonableness and public-law limits.
• Clarity on “Pure Economic Loss” – Clarifies recoverable losses: investment outlays can be claimed where a defendant assumed responsibility, but perpetual profit forecasts cannot.
• Guidance on Standard of Care – Adopts administrative law’s irrationality standard for discretionary allocation decisions, aligning public-law and private-law remediation.
• Future Adjudication – Courts must examine disclaimers, bilateral dealings, knowledge of parties, and rational basis of decisions when assessing negligence in resource-management contexts.
• Broader Administrative Context – Encourages public bodies to formalize risk allocation in grant letters and allow clarity on obligations to avoid later tort claims.

Complex Concepts Simplified

• Assumption of Responsibility
  When a public body (or private person) implicitly promises to handle a task with care—e.g. licensing or grant processing—it may owe a duty of care for economic loss if someone relies on that handling.
• Pure Economic Loss
  Money lost without any physical injury or property damage—for example, investment outlays not recouped. Recoverable where a special relationship exists and carelessly exercised tasks cause predictable losses.
• Proximity & Foreseeability
  Two core ingredients of negligence: the defendant knew (or should have known) the plaintiff would rely on them (proximity) and that failing would cause harm (foreseeability).
• Justiciability vs. Public Law
  Public-law rules address a decision’s legality (judicial review), binding on everyone. Tort law addresses damage to a specific claimant. A decision can be lawful yet negligent if a private duty of care exists.
• Statutory Discretion and “Wednesbury” Reasonableness
  When a public body has wide legal discretion, negligence claims must show the decision was irrational—so unreasonable no reasonable authority could make it.

Conclusion

The Supreme Court’s decision in Barlow & Ors v Minister marks a major step in Irish tort law: it confirms that public authorities exercising statutory powers can incur private-law duties of care by assumption of responsibility where they actively solicit investment and know others will rely on their careful exercise of those powers. It dispels any notion of blanket immunity for administrative discretion, while respecting public-law limits by importing the established standard of unreasonableness. Investors and agencies must now carefully define and, if necessary, disclaim their obligations in grant and licensing arrangements. Future negligence claims against public authorities will hinge on the bilateral relationships formed, the clarity of any risk allocation, and whether contested decisions fall within the rational range of statutory discretion.