Cooper v. Hobart, [2001] 3 S.C.R. 537, 2001 SCC 79, is a Supreme Court of Canada

Supreme Court of Canada

The Supreme Court of Canada is the highest court of Canada and is the final court of appeals in the Canadian justice system. The court grants permission to between 40 and 75 litigants each year to appeal decisions rendered by provincial, territorial and federal appellate courts, and its decisions...

 case that redefined the Anns test adopted in Kamloops v. Nielsen to establish a duty of care

Duty of care

In tort law, a duty of care is a legal obligation imposed on an individual requiring that they adhere to a standard of reasonable care while performing any acts that could foreseeably harm others. It is the first element that must be established to proceed with an action in negligence. The claimant...

 in civil tort

Tort

A tort, in common law jurisdictions, is a wrong that involves a breach of a civil duty owed to someone else. It is differentiated from a crime, which involves a breach of a duty owed to society in general...

 cases.

Background

Eron was a mortgage broker

Mortgage broker

A mortgage broker acts as an intermediary whose brokers mortgage loans on behalf of individuals or businesses.Traditionally, banks and other lending institutions have sold their own products. However as markets for mortgages have become more competitive, the role of the mortgage broker has become...

under the Mortgage Broker's Act. Cooper had advanced money to Eron. Eron’s mortgage license was suspended by Hobart acting in his official capacity as Mortgage Broker Registrar under the Act.

Cooper alleges that Hobart breached a duty of care that he allegedly owed to her and other investors because he had been aware of the serious violations of the Act committed by Eron, and not suspended its license soon enough. The Registrar of Mortgage Brokers had become aware of Eron on August of 1996 and did not suspend his licence until October of 1997.

At trial the Registrar was found to have owed a duty of care to the investors. In appeal, the Court overturned the verdict on grounds that there was no sufficient proximity.

Reasoning of the Court

McLachlin and Major found that if there is no existing category that would create a duty of care, the plaintiff must show proximity, a close and direct relationship with the defendant. In this case, the statute imposes no such duty on the Registrar. While the losses to the plaintiff were foreseeable, proceeding to a policy analysis is unnecessary.

Aftermath and precedence

This case concerns pure economic loss. It is an application of the Anns-Kamloops Test.