Defendant hired a boat from Plaintiff but breached the contract by returning it 4 years before the charter was set to end. 14 months later, the Gulf war broke out, which would have entitled Defendant to end the contract anyway.
Plaintiff claimed for 4 years of damages.
HL ruled that only 14 months worth of damages were payable since the aim was to put the claimant in the position that they would have been in had the contractual performance been fulfilled, and in doing this it couldn’t shut its eyes to future events.
He applies the dictum of Parke B and hence says that what loss is actually caused is the relevant factor. Otherwise the courts would be giving people awards beyond their loss i.e. overcompensating.
Points in response to Lord Scott:
To make people pay for the full amount is a deterrent to breach of contract;
Certainty is important in business, so that if there is a breach, Plaintiff must be able to work out, before entering the contract, what he will be entitled to.
These are detailed case summaries (excerpts from cases - not paraphrase...
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