Something Old Something New - The Remoteness Rule

The recoverability of damages for loss of revenue following a breach of a charter - and, indeed, the law relating to remoteness more generally - was thrust into uncertainty in July 2008, when the House of Lords handed down its judgment in The "ACHILLEAS"¹ substantially qualifying Hadley v Baxendale, the seminal contractual damages decision which had remained largely unadjusted for over 150 years. 

The recent decision in The "SYLVIA"² supports the most favoured view in Hadley v Baxendale on the recoverability of damages for loss of revenue following a breach of a charter, relegating The "ACHILLEAS" to extreme circumstances.

The "ACHILLEAS" Decision and the Orthodox Rule

The majority of the House of Lords asserted that, when assessing the recoverability of damages, the relevant question is whether the loss is of the kind or type for which the "contract breaker ought fairly to be taken to have accepted responsibility" according to the interpretation of the