Onita Pacific Corp. v. Trustees of Bronson

UNIS, J.,

dissenting.

This court exercised its discretionary power to grant review in this case to resolve the confusion and conflict that exists among the trial bench and bar in this state as to (1) whether negligent misrepresentation is actionable in Oregon for economic (pecuniary) damages alone and, if so, (2) what is the scope of liability for the tort. Today the majority recognizes that negligent misrepresentation is actionable, 315 Or at 159-60, but does not define its scope. The majority discusses “whether, during the parties’ arm’s-length negotiations, in addition to a duty of honesty, defendants owed plaintiffs a duty to exercise reasonable care in communicating factual information to prevent economic losses to plaintiffs,” 315 Or at 160, and concludes that, “in arm’s-length negotiations, economic losses arising from a negligent misrepresentation are not actionable.” 315 Or at 161-62. More specifically, the majority states that, because “defendants and their representative did not owe any duty to plaintiffs during the negotiations by virtue of a contractual, professional, or employment relationship or as a result of any fiduciary or similar relationship implied in the law * * *, plaintiffs cannot maintain their claim for negligent misrepresentation against defendants.” 315 Or at 165.

I agree with the majority that negligent misrepresentation is actionable in Oregon for economic damages alone.1I *179would hold that the scope of liability for negligent misrepresentation extends to persons and groups of persons who were foreseen, either because the defendant intended the information for their benefit or because defendant knew that it would be used by them, and who, as a result of their actual and justifiable reliance on negligently-made representations, suffer economic loss. I would conclude that, on the facts of this case, plaintiffs have established a claim for negligent misrepresentation against defendants. I would, therefore, affirm the decision of the Court of Appeals, but in part for different reasons than those advanced by that court.

I. SCOPE OF LIABILITY FOR NEGLIGENT MISREPRESENTATION

While the majority recognizes that the tort of negligent misrepresentation exists in Oregon, the closest the majority comes to explaining what it involves is its statement that “[t]he rule stated in Restatement (Second) of Torts § 552 * * * is close to the mark.” 315 Or at 159. I believe that, in recognizing a new tort, the court should define it, that the majority misunderstands and misapplies the difference between duty and foreseeability, and that the majority incorrectly denies liability as a matter of law under the facts of this case.

Essentially three different standards, with variations, have been adopted by the American courts to define the scope of liability for the tort of negligent misrepresentation: (1) the Ultramares rule, which was stated in Ultramares v. Touche, 255 NY 170, 174 NE 441 (1931).2 The Ultramares rule extends liability for economic loss only to those persons with whom defendant is in a relationship akin to privity;3 (2) the Restatement (Second) of Torts § 552(2) (a) rule (Restatement rule), under which a defendant is liable for the economic loss suffered by “the person or one of a limited group of persons for whose benefit and guidance he intends to supply *180the information” or knows will receive and rely on the information;4 and (3) the foreseeability rule under which liability for negligent misrepresentation extends to include all reasonably foreseeable plaintiffs who, as a result of their actual and justifiable reliance on negligently made misrepresentations, suffer economic damages.5

The Ultramares rule is essentially based on the contract principle of privity. It defines and limits the scope of duty according to the defendant’s state of mind and the agreed-upon expectations of the parties to an underlying contractual relation.

In Martini v. Beaverton Ins. Agency, Inc., 314 Or 200, 838 P2d 1061 (1992), this court declined to apply contract principles to a negligence claim, recognizing that rules that may be proper for a contract action are not proper for a negligence action. The majority departs from this principle in its analysis of contract principles in this tort case. 315 Or at 160-63.

“Negligent misrepresentation is a separate and distinct tort, a species of the tort of deceit.” Bily v. Arthur Young and Co., 11 Cal Rptr 2d 51, 74, 834 P2d 745, 768 (1992). Where a person makes false statements, honestly believing that they are true, but without reasonable ground for such belief, I believe that the person should be liable, under certain circumstances, for negligent misrepresentation, a form of *181deceit. In contract law, liability is determined and limited by the knowledge and intention of the parties. Plaintiffs’ complaint in this case neither asserts a breach of contract nor attempts to enforce any promise made by defendants.

Negligence liability, on the other hand, is based on a paradigm which is fundamentally different than that on which contract liability is predicated. In negligence law, the scope of liability is not determined by a contractual relationship, but by the reasonably foreseeable6 consequences of one’s actions and by considerations of policy that at times limit the scope of the liability. “Tort obligations are in general obligations that are imposed by law on policy considerations to avoid some kind of loss to others. They are obligations imposed apart * * * from any manifested intention of parties to a contract or other bargaining transaction.” Prosser and Keeton, Torts 656, § 92 (5th ed 1984).

The majority states that “[o]ur precedents establish that a negligence claim for the recovery of economic losses caused by another must be predicated on some duty of the negligent actor to the injured party beyond the common law duty to exercise reasonable care to prevent foreseeable harm.” 315 Or at 159 (footnote omitted). The majority misunderstands and misapplies our precedents in two respects. First, the majority misunderstands the distinction between duty and foreseeability. Second, the majority misapplies the limitation on economic damages.

In Fazzolari v. Portland School Dist. No. 1J, 303 Or 1, 17, 734 P2d 1326 (1987), quoted and discussed by the majority in footnote 13, 315 Or at 165-66, this court stated:

“In short, unless the parties invoke a status, a relationship, or a particular standard of conduct that creates, defines, or limits the defendant’s duty, the issue of liability for harm actually resulting from the defendant’s conduct properly depends on whether that conduct unreasonably created a *182foreseeable risk to a protected interest of the kind of harm that befell the plaintiff.”

This language has become critical in understanding Oregon negligence principles. The majority claims that this language does not dictate a different result than that reached by the majority, but the majority’s analysis proceeds from the first part of the statement without regard for the last part of the statement. That is, the first part of the statement suggests that special relationships giving rise to a duty can create liability. Thus, the majority asserts that it must search for a special duty:

“Having recognized the existence of the tort, the central question in the present case becomes whether, during the parties’ arm’s-length negotiations, in addition to a duty of honesty, defendants owed plaintiffs a duty to exercise reasonable care in communicating factual information to prevent economic losses to plaintiffs.” 315 Or at 160.

Then the majority painstakingly discusses a series of cases involving duty, concluding that, “in arm’s-length negotiations, economic losses arising from a negligent misrepresentation are not actionable.” 315 Or at 161-62. However, all that the majority’s analysis has thus far established is that there is no special relationship or duty. But this is only the first part of the Fazzolari analysis, and the peripheral part at that.

Fazzolari stated that “unless” the parties invoke a relationship that “creates, defines, or limits defendant’s duty” (which the majority concludes they have not), “the issue of liability for harm actually resulting from defendant’s conduct properly depends on whether that conduct unreasonably created a foreseeable risk to a protected interest of the kind of harm that befell the plaintiff.” Fazzolari v. Portland School Dist. No. 1J, supra, 303 Or at 17. Thus, the majority has seized on the exception and ignored the rule. That rule suggests that foreseeability is the proper inquiry regarding negligence actions.

It is true that the rules of foreseeability have at times been subject to limitations in situations in which, for policy reasons, the damage is too remote to support liability. The Fazzolari opinion foreshadowed a more direct statement in Hale v. Groce, 304 Or 281, 744 P2d 1289 (1987), which was decided less than eight months after Fazzolari, when it *183stated, in the context of limiting harm which was foreseeable but remote, that one example of a predictable but remote harm limited by common-law negligence is solely economic harm. Fazzolari v. Portland School Dist. No. 1J, supra, 303 Or at 7.7 In Hale v. Groce, supra, 304 Or at 284, the court stated that, when economic loss alone is suffered, “[s]ome source of a duty outside the common law of negligence is required,” i.e., that foreseeability alone is not enough to establish liability. Apparently the majority seizes on its duty analysis because of statements like this which suggest that a duty is required when purely economic damages are involved. The majority fails to recognize that this extra “special duty” requirement arises in the context of economic damages which are, by definition, very remote, such that the special duty would create or expand liability. The precedents suggest a limitation on remote damages in the context where economic damages were remote, not a limitation on economic damages per se.

*184In Hale v. Groce, supra, the context was a claim against an attorney for negligence in drafting a will which failed to provide for a gift to plaintiff intended by the testator. The tort was only cognizable because of a duty arising from the plaintiffs status as the intended beneficiary of the defendant’s conduct. The court reasoned that, absent the contractual undertaking in that case, “plaintiffs tort claim would confront the rule that one ordinarily is not liable for negligently causing a stranger’s purely economic loss without injuring his person or property.” Id. at 284.

The basis for the rule stated in Hale v. Groce that “one ordinarily is not liable for negligently causing a stranger’s purely economic loss without injuring his person or property” was not a distinction between economic loss and injury to person or property. Rather, the basis for the rule, alluded to in Fazzolari v. Portland School Dist. No. 1J, supra, 303 Or at 7, was a distinction between direct and remote harm; where the direct harm is to the person or property of one person, resulting economic harm to a third person is too remote, as a policy matter, to be cognizable in negligence. Hale v. Groce, supra, 304 Or at 284, cited two cases to support this proposition. In Ore-Ida Foods v. Indian Head, 290 Or 909, 627 P2d 469 (1981), which involved a claim by decedent’s employer against the person accused of causing decedent’s death and thus of causing harm to employer who then had to pay death benefits, this court stated:

“We believe that the denial by other courts of claims for economic loss arising from injury to third persons, although phrased in terms of lack of foreseeability, duty and proximate cause, actually reflects their policy decision to limit recovery of such damages. The number of economic interests which could be damaged from an act are, in some cases, practically limitless * * Id. at 917.

In the other case, Snow v. West, 250 Or 114, 440 P2d 864 (1968), this court did not allow an employer to recover lost profits based on the loss of services of his employees caused by defendant, whose negligent driving caused an accident, killing one and injuring six employees. Likewise, in Hale v. Groce, the basis for statement of the rule preventing the recovery of economic damages alone was the remoteness of the economic injury to a third person, which in that case was overridden by plaintiff s contractual status as a third party beneficiary.

*185Thus, in these cases involving economic harm, foreseeability was not enough to establish liability: “It does not suffice that the harm is a foreseeable consequence of negligent conduct that may make one liable to someone else * * *. ” Hale v. Groce, supra, 304 Or at 284. The majority fails to recognize that this was true not because the harm alleged was economic, but because it was too remote. As such, the majority’s discussion of duty, 315 Or at 160-61, is applicable to a case involving economic damage to secondary, remote plaintiffs, but that is not this case.8

Thus, economic damage to a third party based on some other underlying injury, while it is foreseeable, is too remote to be actionable as a general rule. Where the underlying injury is itself economic, however, the same rationale supports liability for direct economic harm, with limitations for more remote economic harm.

Those principles are consistent with the recognition of the tort of negligent misrepresentation for economic loss alone where that economic harm is the primary harm caused by defendant’s negligence, and is foreseen, either because the defendant intended the information for their benefit or because defendant knew that it would be used by them, and who, as a result of their actual and justifiable reliance on negligently-made representations, suffer economic loss. The damage is not so remote as to prevent a claim for negligent misrepresentation when a person represents something to be true and actually foresees, or even expects, that identifiable persons will rely on the statement or information (to their detriment if the information is wrong, which is another way of saying that the reliance on the statement caused harm because the statement was false). If the situation is such that the plaintiffs reliance is not only reasonably foreseen by defendant, but is also justified, defendant should be liable to *186plaintiff if he fails to use reasonable care in imparting information, i.e., if he does so negligently. Defendant’s failure to meet the standard should give rise to liability for plaintiffs harm even if the harm is economic where the harm is not remote.

I believe that this standard is consistent with the Restatement (Second) of Torts § 552:

“(1) One who, in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.
“(2) Except as stated in Subsection (3), the liability stated in Subsection (1) is limited to loss suffered
“(a) by the person or one of a limited group of persons for whose benefit and guidance he intends to supply the information or knows that the recipient intends to supply it; and
“(b) through reliance upon it in a transaction that he intends the information to influence or knows that the recipient so intends or in a substantially similar transaction.
. “(3) The liability of one who is under a public duty to give the information extends to loss suffered by any of the class of persons for whose benefit the duty is created, in any of the transactions in which it is intended to protect them.”

That is, the liability under the Restatement rule extends not to all persons who could rely on the information, but to only those persons, or groups of persons, who were foreseen, either because the defendant intended the information for their benefit or because the defendant knew that it would be used by them. Restatement (Second) of Torts § 552(2)(a). Under the Restatement rule, liability is imposed on the supplier of information to a person or to third persons who are intended recipients of the information. The scope of the tort of negligent misrepresentation should be limited in one other significant respect: The pecuniary loss must be *187caused by justifiable reliance on the information. Restatement (Second) of Torts § 552(1). It may be that, in a particular arm’s-length transaction between sophisticated parties, reliance on the information provided by the other party or on the other party’s interpretation of contract language is not justified. Normally this is a question for the jury. In this case, the jury answered it, and I would not disturb their finding.

The majority suggests that its analysis is consistent with the Restatement (Second) of Torts § 552.315 Or at 164.1 disagree. First, the majority states its rule with respect to “nongratuitous suppliers of information” to “clients or employers orto intended third-party beneficiaries.” 315 Or at 165. The Restatement is not so limited, however, and is not based solely on a contractual relationship. Rather, the Restatement is based on negligence principles of foreseeability, limited to exclude remote plaintiffs, and does not require compensation giving rise to a contractual obligation:9

‘ ‘ [Liability is limited to loss suffered] by the person or one of a limited group of persons for whose benefit and guidance he intends to supply the information or knows that the recipient intends to supply it * * *.” Restatement (Second) of Torts § 552(2)(a).

I believe that the facts of this case present a prime example of the type of relationship in a commercial transaction contemplated by the Restatement rule. Plaintiffs are the persons for whose benefit and guidance defendants intended to supply the information in order to secure a monetary gain through plaintiffs’ reliance on that information. Plaintiffs *188purchased from defendants real estate parcels with the intent of subdividing them and reselling the parcels at a profit. As previously stated, the scope of liability for tort should not be determined by contract principles.

Second, the majority suggests that liability for negligent misrepresentation can only arise in “relationships other than the relationship between persons negotiating at arm’s length.” 315 Or at 164.10 While it may be that, in practice, some courts have not extended liability based on § 552 to parties in an adversarial negotiating relationship, as some authorities cited by the majority suggest, neither those courts nor those authorities have suggested that such a result is a per se rule based on the language of § 552.1 believe that the majority has misconstrued § 552 to per se prohibit liability arising from an adversarial negotiating relationship.

Rather, the proper inquiry under § 552(1) is whether plaintiffs’ reliance on defendants’ representation was foreseen by defendants and whether such reliance was justified. That should be a factual question. Perhaps as between some sophisticated adversaries with equal access to the critical information, a party would not be justified to rely on a representation from the adversary. It is not clear whether this is the situation contemplated by the majority’s reference to persons negotiating at “arm’s length,” or whether that term encompasses more. Having failed to define the components of arm’s-length negotiations, it is unclear how the majority can summarily decide that the parties to this transaction were negotiating at arm’s length. Perhaps they were, but we are not told how that is to be determined.

I believe that, rather than introducing the extraneous concept of arm’s-length negotiations to determine the applicability of § 552, we should examine the terms of § 552.

For reasons stated above, I disagree with the majority’s restrictive view of the scope of liability for the tort of negligent misrepresentation. Under the majority’s rule, there would be no liability in an action based on the tort of negligent misrepresentation unless “defendants and their *189representative * * * owe[d a] * * * duty to'plaintiffs during the negotiations by virtue of a contractual, professional, or employment relationship or as a result of any fiduciary or similar relationship implied in the law.” 315 Or at 165.

In sum, I would hold that negligent misrepresentation liability extends to persons or groups of persons who were foreseen either because the supplier of the information intended the information for -their benefit or because the supplier of the information knew it would be used by them, and who, as a result of their actual and justifiable reliance on negligently-made representations, suffer economic loss.

II. PLAINTIFFS ESTABLISHED THEIR NEGLIGENT MISREPRESENTATION CLAIM

Plaintiffs obtained a jury verdict on their negligent misrepresentation claim. The facts, therefore, are construed in the light most favorable to plaintiffs. Brown v. J. C. Penney Co., 297 Or 695, 705, 688 P2d 811 (1984). The majority’s statement of the factual background concerning plaintiffs’ negligent misrepresentation claim is in accord with that principle. Additional facts are summarized in the Court of Appeals opinion. Onita Pacific Corp. v. Trustees of Bronson, 104 Or App 696, 803 P2d 756 (1990). I wish to emphasize certain facts which are central to plaintiffs’ negligent misrepresentation claim and which demonstrate that in this case plaintiffs did establish enough for a jury to conclude that their negligent misrepresentation claim was valid. Those facts are: Warde Erwin represented that deeds could be released on the payment into escrow of a specified sum. Lawrence Erwin, defendants’ attorney, represented that deeds could be released and that $200,000 payment would result in the release to plaintiffs of lots worth $200,000. Lawrence Erwin represented that if escrow were moved, the escrow instructions would remain the same and that if the $200,000 were processed through his (Lawrence Erwin’s) trust account, deeds would be released on the same terms as if the $200,000 had been processed through the title company escrow. However, once the $200,000 was paid and processed through Lawrence Erwin’s trust account, defendants refused to release any deeds. Defendants insisted that the deeds could be released only on the sale of a lot to a third party. Defendants also issued new instructions that prevented plaintiffs from *190obtaining the release of the lots from the new title company escrow based on the payment that plaintiffs had made. As a result of defendants’ refusal to release the deeds, plaintiffs were unable to obtain financing to develop the lots for resale, and they defaulted on their obligation to Compton. Compton then foreclosed on the security that plaintiffs had pledged, viz, plaintiffs’ interests as assignees of the Hatch contract, as well as certain other property.

In the language of § 552(1), liability is limited to situations in which reliance is justified. In this case the jury found that plaintiffs’ reliance on defendants’ misrepresentation was justified. Plaintiffs were foreseen, intended recipients of defendants’ conduct. We should not disturb that finding by conclusory references to the extraneous concept of arm’s-length negotiating, even if it is true that in some circumstances an adversarial negotiating relationship would make reliance unjustified. There is ample evidence in the record of this case to support a finding that plaintiffs have established their negligent misrepresentation claim against defendants.

III. CONCLUSION

In conclusion, I agree that negligent misrepresentation is actionable in Oregon, but I would define the tort and hold that plaintiffs have established their claim against defendants for that tort. I would, therefore, affirm the decision of the Cóurt of Appeals, but for different reasons than those advanced by that court. I, therefore, respectfully dissent.

I am pleased to see that the majority has asserted its common-law authority to recognize a new tort without considering its self-imposed methodology of judicial restraint outlined in G.L. v. Kaiser Foundation Hospitals, Inc., 306 Or 54, 59, 757 P2d 1347 (1988), and recently applied in Hammond v. Central Lane Communications Center, 312 Or 17, 816 P2d 593 (1991), and Keltner v. Washington County, 310 Or 499, 800 P2d 752 (1990). I have expressed my disagreement with those restraints in Hammond, 312 Or at 28 (Unis, J., dissenting), and in Keltner, 310 Or at 510 (Unis, J., dissenting). In fact, the majority now is determined to exercise its common-law authority on a case-by-case basis in developing the tort of negligent misrepresentation. 315 Or at 159.

For a recent summary of those jurisdictions which purport to follow the Ultramares rule in one form or another, see Bily v. Arthur Young and Co., 3 Cal 4th 370, 11 Cal Rptr 2d 51, 834 P2d 745, 752-55 (1992).

In Credit Alliance Corp. v. Arthur Andersen & Co., 65 NY 2d 536, 493 NYS 2d 435, 483 NE2d 110 (1985), the New York.court reaffirmed the Ultramares rule, but extended it to relationships which are practically equivalent to privity.

Restatement (Second) of Torts § 552(1) (1977) reads:

“One who, in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.”
“[T]he Restatement rule * * * has somewhat more support than the privity of relationship rule * * *. At least seventeen state and federal decisions have endorsed the [Restatement] rule * * *.” Bily v. Arthur Young and Co., 11 Cal Rptr 2d 51, 834 P2d 745, 758-59 (1992) (listing those jurisdictions at note 9).

At least three states have endorsed the reasonable foreseeability rule. See Rosenblum v. Adler, 93 NJ 324, 461 A2d 138 (1983); Citizens State Bank v. Timm, Schmidt & Co., 113 Wis 2d 376, 335 NW2d 361 (1983); Touche Ross & Co. v. Commercial Union Ins., 514 So2d 315 (Miss 1987) (all recognizingthis rule). See also Wiener, Common Law Liability of the Certified Public Accountant for Negligent Misrepresentation, 20 San Diego L Rev 233 (1983) (advocating rejection of Ultra-mares rule and adoption of foreseeability rule).

1 believe that negligence law should provide liability for reasonably foreseeable consequences, not for any foreseeable consequences. See Forell, Replacing Pragmatism and Policy With Analysis and Analogy: Justice Linde’s Contribution to Oregon Tort Law, 70 Or L Rev 815, 829-32 (1991) (suggesting that this court describes the test as a factual “foreseeability” test where in practice it applies a “reasonably foreseeable” test).

The majority mistakenly takes this language in Fazzolari v. Portland School Dist. No. 1J, 303 Or 1, 734 P2d 1326 (1987), to suggest a rule against recovery for purely economic damages solely because they are economic, 315 Or at 165-66 n 13; Fazzolari clearly referred to economic damages in the context of remoteness because in normal negligence the direct harm is physical injury and economic harm is secondary:

“[T]he ‘duty’ concept was retained in negligence law. Bounds ofliabilitymustbe stated somehow if the law was not to make one insure the world at large against all harm from one’s negligent conduct. Although negligent conduct caused harm in fact, the law might deny liability if this harm did not seem ‘natural’ and ‘proximate’ but ‘remote,’ words which again focused on foreseeability in a factual setting. * * * But because common-law negligence traditionally has excluded some categories of quite predictable injuries and claimants (familiar illustrations include solely economic or psychic injuries, injuries due to a bystander’s failure to rescue and injuries to trespassers), courts still find lack of a ‘duty’ a convenient label for these categorical rulings.” Fazzolari v. Portland School Dist. No. 1J, supra, 303 Or at 6-7 (footnotes omitted).

The majority’s parenthetical description of Norwest v. Presbyterian Intercommunity Hosp., 293 Or 543, 561, 652 P2d 318 (1982), involving psychic injuries itself demonstrates that the rationale is not the type of injury (here, psychic but non-economic) but the remoteness of the injury. The majority’s parenthetical described the case as “denying recovery to child for foreseeable damages sustained as a result of mother’s bodily injury, in part because general negligence law in Oregon does not recognize the recovery of damages for psychic injuries suffered by one not directly injured by the negligent conduct.” 315 Or at 165-66 n 13 (some emphasis added). Cf. Hammond v. Central Lane Communications Center, supra, 312 Or at 28-32 (Unis, J., concurring in part, dissenting in part); Note, Hammond v. Central Lane Communications Center: Oregon Rejects Negligent Infliction of Severe Emotional Distress Through the Back-Door Policymaking ofJudicial Restraint, 71 Or L Rev 219 (1992).

Indeed, the majority’s focus on whether the injury is economic produces perplexing results in the context of the majority’s recognition of the tort of negligent misrepresentation. Imagine that a party receives the gratuitous advice of a contractor, who negligently misrepresents that a house is structurally sound when it is not, and from an accountant, who negligently misrepresents that a company’s books are sound when they are not. The person enters the house, which collapses, causing him serious bodily injury, and buys stock in the company, which collapses, causing him serious economic loss. Apparently the majority would distinguish between these two situations based on the type of injury which befell plaintiff, which makes no sense at all. Both injuries were equally direct.

The focus of Restatement (Second) Torts §552(1) is on whether a defendant had a pecuniary interest in the transaction, not on whether the information was provided gratuitously. Comment c, in explaining the pecuniary interest language, states: “If a [defendant] has no pecuniary interest and the information is given purely gratuitously, he is under no duty to exercise reasonable care and competence in giving it.” Comment d explains:

“The defendant’s pecuniary interest in supplying the information will normally lie in a consideration paid to him for it or paid in a transaction in the course of and as a part of which it is supplied. It may, however, be of a more indirect character. Thus the officers of a corporation, although they receive no personal consideration for giving information concerning its affairs, may have a pecuniary interest in its transactions, since they stand to profit indirectly from them, and an agent who expects to receive a commission on a sale may have such an interest in it although he sells nothing.”

See also Restatement (Second) Torts § 552, comments g & h and illustrations 4-11.

Thus, the majority is saying that the duty must necessarily arise from a contractual relationship (i.e., be nongratuitous), but cannot arise between parties to a contract.