The court considered an an application to strike out a claim for damages for the loss of profits which the claimant said he would have made if the bank had complied with its agreement to provide him with funds for a property development.
Held: Even on the assumption that the bank knew of the purpose for which the funds were required and that it was foreseeable that he would suffer loss of profit if he did not receive them, the damages were not recoverable. Sir Anthony Evans said: ‘The authorities to which we were referred . . demonstrate that the concept of reasonable foreseeability is not a complete guide to the circumstances in which damages are recoverable as a matter of law. Even if the loss was reasonably foreseeable as a consequence of the breach of duty in question (or of contract, for the same principles apply), it may nevertheless be regarded as ‘too remote a consequence’ or as not a consequence at all, and the damages claim is disallowed. In effect, the chain of consequences is cut off as a matter of law, either because it is regarded as unreasonable to impose liability for that consequence of the breach (The Pegase [1981] 1 Lloyd’s Rep 175 Robert Goff J), or because the scope of the duty is limited so as to exclude it (Banque Bruxelles SA v. Eagle Star [1997] AC 191), or because as a matter of commonsense the breach cannot be said to have caused the loss, although it may have provided the opportunity for it to occur . . ‘
Judges:
Sir Anthony Evans
Citations:
[2003] EWCA Civ 1112
Links:
Jurisdiction:
England and Wales
Cited by:
Cited – Transfield Shipping Inc v Mercator Shipping Inc (The Achilleas) HL 9-Jul-2008
The parties contracted to charter the Achileas. The charterer gave notice to terminate the hire, and the owner found a new charterer. Until the termination the charterers sub-chartered. That charter was not completed, delaying the ship for the . .
Lists of cited by and citing cases may be incomplete.
Litigation Practice
Updated: 20 November 2022; Ref: scu.185304