The claimants purchased a licence to promote three films, but the defendant lost the film prints and CCC could not therefore promote them. After their claim for loss of profit failed in the absence of evidence, they claimed for the expenditure they had wasted.
Held: The plaintiff has a full discretion to pursue either a loss of profit or for wasted expenditure after a breach of contract by the defendant. He need not provide evidence before making that election. Where the defendant prevented the fulfilment of the contract the onus lay on him to prove it if he asserted that the plaintiff would not have managed to recoup at least his expenditure from profits. It would be fair to impose the onus of proof on the defendant at least in the following cases: ‘where the plaintiff’s decision to base his claim on abortive expenditure was dictated by the practical impossibility of proving loss of profit rather than by unfettered choice, any other rule would largely, if not entirely, defeat the object of allowing this alternative method of formulating the claim. This is because, notwithstanding the distinction to which I have drawn attention between proving a loss of net profit and proving in general terms the probability of sufficient returns to cover expenditure, in the majority of contested cases impossibility of proof of the first would probably involve like impossibility in the case of the second. It appears to me to be eminently fair that in such cases where the plaintiff has by the defendant’s breach been prevented from exploiting the chattel or the right contracted for and, therefore, putting to the test the question of whether he would have recouped his expenditure, the general rule as to the onus of proof of damage should be modified in this manner’.
Judges:
Hutchison J
Citations:
[1985] 1 QB 16, [1984] 3 WLR 245
Jurisdiction:
England and Wales
Cited by:
Not applied – Parker and Another v SJ Berwin and Co and Another QBD 17-Dec-2008
The claimants sought damages from their former solicitors. They set out to purchase a football club, expending substantial sums for the purpose, relying on the defendants’ promised provision of service in finding and arranging the funding. They said . .
Cited – Omak Maritime Ltd v Mamola Challenger Shipping Co Ltd ComC 4-Aug-2010
Lost Expenses as Damages for Contract Breach
The court was asked as to the basis in law of the principle allowing a contracting party to claim, as damages for breach, expenditure which has been wasted as a result of a breach. The charterer had been in breach of the contract but the owner had . .
Lists of cited by and citing cases may be incomplete.
Contract, Damages
Updated: 05 May 2022; Ref: scu.278874
