McLauchlan and Summers, ‘Mitigation and Causation of Benefits’

Abstract
This article examines mitigation and the causation of benefits in the assessment of damages for breach of contract, following the UK Supreme Court’s decision in The New Flamenco [2017] UKSC 43. It clarifies the meaning and scope of ‘speculation’ reasoning, according to which a benefit (or harm) is said to be ignored in the assessment of damages where it derived from a ‘commercial risk’ undertaken by the claimant. The authors argue that speculation reasoning properly applies where the claimant made a choice not to take steps that would have put it as nearly as possible in the same position as if the contract had been performed. They conclude that the correctness of the decision in The New Flamenco thus turns on whether the shipowners had such a choice, for example, to rehire the vessel under a series of shorter charters, instead of putting it up for sale.

McLauchlan, David and Summers, Andrew, Mitigation and Causation of Benefits (February 01, 2018). Forthcoming in Lloyd’s Maritime and Commercial Law Quarterly. ISSN 0306-2945.

First posted 2018-03-07 06:58:14

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