Victoria Laundry Argumentative Essay

Applying Hadley, in Victoria Laundry (Windsor) v Newman Industries claimants claim for the exceptional profits from some highly lucrative dying contracts but there was no way the defendant can reasonable foresee about this. Hence court of appeal disallowed this exceptional loss from failure to profit from highly lucrative dying contracts. Here, damages awarded does not put the claimants in the position they should have been had the contract been performed, which is without the delay as this exceptional loss of profits is held to be the same as the normal loss of profits. In Heron II , Victoria Laundry was criticised and where in order to separate between remoteness rule in tort and contract, courts consider remoteness based on whether

This is so because once non-breaching parties successfully taken steps to reduce losses, damages received are small amount of reliance losses, but if they do not take these steps, they may not get full compensation. This shows that contract law is being harsh towards non-breaching parties to limit claims of damages. In Payzu Ltd v Saunders, as defendants’ cheque for their first batch of silk was not received, the claimants breach the contract by claiming that they would not continue delivering silks unless claimants pay in cash. However, the claimants refused this suggestion and claim damages for difference of contracted and market price. It was held that the claimants should have mitigated their loss. They are only given damages consisting of their loss if they had accepted the defendants’ suggestions. This shows claimants being undercompensated because claimants seem to be forced to co-operate with breaching parties in mitigating defendants’ loss and get less compensation. A best example to show that mitigation principle prevents damages from giving non-breaching parties full compensation is where those expenditure unreasonably spent cannot be recovered. In Compania Financiera ‘Soleada’ SA v Hamoor Tanker Corpn Inc , where a loan with very high interest rate to release detained ship was not recoverable as it is unreasonably