Suing for loss of profit

After reading what I wrote last week, the issue of damages should be dug a little bit deeper. Like how stupid people do what they find the region behind their nose, and above their neck, a hollow one. Somehow ‘thinking’ they actually might find something there.

Section 74 of the Contracts Act actually rooted from the case of Hadley v Baxendale.

The Millers had a mill that stopped functioning when the crankshaft broke and they employed Lem, who were carriers, to deliver the broken crankshaft to the manufacturer as a pattern, to make a new one.

Lem delivered the cranshaft late, which led to the unexpected continuous inoperation of the Miller’s mill. Meaning, instead of being inoperation for 2 months, because of the delay now the mill was out of operation for 6 months.

The Millers are now suing for the profits they could have made in that 4 months.

Court said,

NEHI.

The Millers could not sue for that 4 months because, the information communicated to Lem did not show that a delay in the delivery of the shaft, would cause a loss of profit. There is chance that the Millers have another shaft they could use, or that there might be other defects that may cause the mill to stop.

Had Lem been informed, or knew, that the mill could not operate with the shaft, he too would also know that for being a slow ass, that attitude would cause a loss of profit to the Millers.

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*The writer is a law graduate who failed Contract Law (Part 2) once. He writes for RA almost every Monday

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