Remoteness Case Study

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The general rule is that innocent parties are designated to such damage as will put them in the stand they would have been in if the contract had been executed, but there are three restrictions, which will be considered under the headline of remoteness, mitigation and causation. However, only measure of damages in light of remoteness will be discussed here. The classic test for remoteness was restated in the case of Nikseng Development Sdn Bhd v Public Bank Berhad & Another Appeal (2011) by Clement Skinner JCA when his lordship held that the court must first ascertain whether the damage or loss which the innocent party alleges he suffered naturally arose in the usual course of things from the withdrawal or which the parties knew when they made…show more content…
In a claim for damages for breach of contract, the locus classicus on this principle of remoteness is the case of Hadley v Baxendale (1854) where the case supplies two tests for evaluating which damages are proximate and recoverable and which are too remote and therefore unrecoverable. The following tests are, do the damages arise naturally from the breach? Or were the damages reasonably considered by both parties when they made the contract as being a possible result of the breach? Damages are claimed to be proximate and that is not too remote and therefore recoverable, if the answer to any of these two questions is…show more content…
The purpose for granting damages is to assure the interest of the plaintiff. In the light of loss of profits or bargain, the basis for awarding damages is meant to put the plaintiff in the position he would have been in had the contract been performed as expected. This would be the monetary gains which the plaintiff would have expected to obtain if the contract had been fully performed by the defendant for the reward for loss of profit. In the light of wasted expenditure, the role of damages is to put the plaintiff back in the position he would have been had he not entered into the contract. This would include a claim for loss of capital expenditure, which is the money that had been tapped out by the plaintiff to perform the

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