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The Heron Ii Notes

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The Heron Ii Revision

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THE HERON II FACTS By charterparty of October 15, 1960, the respondents chartered the appellant's vessel, Heron II , to proceed to Constanza, there to load a cargo of 3,000 tons of sugar; and to carry it to Basrah, or, in the charterer's option, to Jeddah. The vessel left Constanza on November 1, 1960. The option was not exercised and the vessel arrived at Basrah on December 2, 1960. The umpire has found that "a reasonably accurate prediction of the length of the voyage was twenty days." But the vessel had in breach of contract made deviations which caused a delay of nine days. It was the intention of the respondents to sell the sugar "promptly after arrival at Basrah and after inspection by merchants." The appellant did not know this, but he was aware of the fact that there was a market for sugar at Basrah. The sugar was in fact sold at Basrah in lots between December 12 and 22, 1960, but shortly before that time the market price had fallen, partly by reason of the arrival of another cargo of sugar. It was found by the umpire that if there had not been this delay of nine days the sugar would have fetched £32 10s. 0d. per ton. The actual price realised was only £31 2s. 9d. per ton. The respondents claim that they are entitled to recover the difference as damage for breach of contract. The appellant admits that he is liable to pay interest for nine days on the value of the sugar and certain minor expenses but denies that fall in market value can be taken into account in assessing damages in this case. HOLDING LORD REID Remoteness in Contract - "not unlikely" test So the question for decision is whether a plaintiff can recover as damages for breach of contract a loss of a kind which the defendant, when he made the contract, ought to have realised was not unlikely to result from a breach of contract causing delay in delivery. I use the words "not unlikely" as denoting a degree of probability considerably less than an even chance but nevertheless not very unusual and easily foreseeable. Interpretation of Hadley Alderson B. clearly did not and could not mean that it was not reasonably foreseeable that delay might stop the resumption of work in the mill. He merely said that in the great multitude - which I take to mean the great majority - of cases this would not happen. He was not distinguishing between results which were foreseeable or unforeseeable, but between results which were likely because

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