A professional accountant named Adam Accurate had been independently retained by Heavy Machinery Corporation ("HMC") to prepare HMC's annual financial statement.While doing so, Adam failed to record expenses incurred during the last month of HMC's fiscal year.The board members of HMC were surprised at the unexpectedly large profit which was revealed by the financial statement.Yet, based on the strength of the statement, HMC's board ordered some expensive new equipment and paid a $60,000 deposit for the equipment.

Based on this financial statement, HMC had expected its bank to increase its line of credit sufficiently to cover the cost of the equipment that had been ordered.However, after reviewing the financial statement, the bank had doubts about its accuracy and asked HMC to check its figures.HMC then contacted Adam Accurate who rechecked the information previously provided to him and quickly found the error.The bank received a revised financial statement for HMC and then refused to increase HMC's line of credit, as the corporation was now only marginally profitable.

HMC was then compelled to cancel its order for the new equipment and in doing so breached its contract with the supplier.This breach meant that HMC then lost its $60,000 deposit by way of damages.

HMC now wants to sue Adam Accurate.What legal grounds would HMC have to sue Adam; what defences would be available to Adam; and what would the likely outcome of this case be?