Chapter 1 – General Principles of Damages
I. Introduction
-purpose of an award of damages is to put the party complaining in the position that he or she would have occupied if the wrong had
not been done
-Livingstone v Rawyards Coal Co (1880): where any injury is to be compensated by damages, in settling the sum of money to be
given for reparation of damages you should as nearly as possible get at that sum of money which will put the party who has been
injured, or who has suffered, in the same position as he would have been in if he had not sustained the wrong for which he is now
getting his compensation or reparation -this principle is not self-applying
-The ‘Columbus’ (1849) (HC Admir): I apprehend the general rule of law is, that where an injury is committed by one individual to
another ... the party receiving the injury is entitled to an indemnity for the same. But although this is the general principle of law, all
Courts have found it necessary to adopt certain rules for the application of it; and it is utterly impossible, in all the various cases that
may arise, that the remedy which the law may give should always be the precise amount of the loss or injury sustained. In many cases it
will, of necessity, exceed, in others fall short of the precise amount
-*chief limiting principles are remoteness, uncertainty, and mitigation
-**the plaintiff must establish, on the balance of probabilities, that he has suffered a loss and that the loss has been caused by the
defendant’s wrong – but, if all such losses were to be compensated defendants would be liable for very unexpected consequences
-Vancouver’s Island Spar Lumber & Saw-Mill Co Ltd v Nettleship (1868) – where a man going to be married to an heiress,
his horse having cast a show on the journey, employed a blacksmith to replace it, who did the work so unskillfully that the
horse was lamed, and, the rider not arriving in time, the lady married another; and the blacksmith was held liable for the loss
of the marriage
-since the 19th century, it has been recognized that a limit is necessary, but it has not been easy to formulate the principle to explain and
predict which kinds of losses will be classified as legally too remote and which will not
II. Remoteness
-H Parsons (livestock) Ltd v Uttley Ingham & Co Ltd [1978] QB 791 (CA):
-facts: The defendant sold a hopper for storing pig food to the plaintiff for the plaintiff’s pigs. In installing the hopper, the defendant
failed to open a ventilator, with the result that the pignuts became mouldy, and the pigs were affected by the intestinal infection
-*found that the lack of top ventilation in the hopper caused the condition, but it is the defendants’ case that at the time of contract the
parties could not have reasonably contemplated that nuts, rendered moldy by lack of hopper ventilation, would cause serious illness
such as E. coli in the pigs that fed on them
-judge: found that there was a warranty—its existence is not disputed by the defendants—to the effect that the hopper should be
reasonably fit for the purpose of storing pignuts in a condition suitable for feeding to the plaintiffs’ pigs. He found that the hopper,
being unventilated, was not so fit; and this defect was a breach of the warranty, and that the pignuts were unfit by reason of the breach.
He found that the plaintiffs’ loss was caused by the breach of warranty.
The Law as to Remoteness
-C Czarnikow Ltd v Koufos (1969) HoL said, in remoteness of damage, there is a difference between contract and tort. In the case of a
breach of contract, the court has to consider whether the consequences were of such a kind that a reasonable man, at the time of
making the contract, would contemplate them as being a very substantial degree of probability
-in the case of a tort, the court has to consider whether the consequences were of such a kind that a reasonable man, at the time of the
tort committed, would foresee them as being of a much lower degree of probability.
-sufficent if the consequences are liable to happen in the most unusual case or in a very improbable case or that they may
happen as a result of the breach, however, unlikely it may be, unless it can be brushed aside as far fetched
-Berryman finds it difficult to apply those principles universally to all cases of contract or to all cases of tort; and to draw a distinction
between what a man contemplates and what he foresees
-to say nothing of the different degrees of probability—especially when the cause of action can be laid either in contract or in tort. I am
swept under by the conflicting currents. I go back with relief to the distinction drawn in legal theory by Professors Hart and Honore in
their book Causation in the Law. They distinguish between those cases in contract in which a man has suffered no damage to person or
property, but only economic loss, such as loss of profit or loss of opportunities for gain in some future transaction: and those in which
he claims damages for an injury actually done to his person or damage actually done to his property (including his livestock) or for
ensuing expense (damnum emergens) to which he has actually been put.
-In the law of tort, there is emerging a distinction between economic loss and physical damage: see Spartan Steel & Alloys Ltd. v.
Martin & Co. (Contractors) Ltd., [1973] QB 27. - any 'pure' economic loss suffered in addition to physical damage are unrecoverable as
either too remote, or outside the scope of the duty of care. However, economic losses consequential on the damage to the metal in the
melt (such as lost profits on the damaged metal) were recoverable.
Loss of Profit Cases
-the defaulting party is only liable for the consequences if they are such as, at the time of the contract, he ought reasonably to have
contemplated as a serious possibility or real danger. You must assume that, at the time of the contract, he had the very kind of breach in
1
,mind—such a breach as afterwards happened, as for instance, delay in transit—and then you must ask: ought he reasonably to have
contemplated that there was a serious possibility that such a breach would involve the plaintiff in loss of profit? If yes, the contractor is
liable for the loss unless he has taken care to exempt himself from it by a condition in the contract—as, of course, he is able to do if it
was the sort of thing which he could reasonably contemplate. The law on this class of case is now covered by the three leading cases of
Hadley v. Baxendale; Victoria Laundry (Windsor) Ltd. v. Newman Industries Ltd., [1949] 2 KB 528 (CA); and C. Czarnikow Ltd. v.
Koufos. These were all “loss of profit” cases: and the test of “reasonable contemplation” and “serious possibility” should, I suggest, be
kept to that type of loss or, at any rate, to economic loss.
Physical Damage Case
-the defaulting party is liable for any loss or expense which he ought reasonably to have foreseen at the time of the breach as a possible
consequence, even if it was only a slight possibility. You must assume that he was aware of his breach, and then you must ask: ought
he reasonably to have foreseen, at the time of the breach, that some-thing of this kind might happen in consequence of it? This is the
test which has been applied in cases of tort ever since The Wagon Mound cases, [1961] AC 388. But there is a long line of cases which
support a like test in cases of contract.
-Kienzle v Stringer (1981): sole issue at trial and on this appeal is the quantum of the plaintiff’s damages
-Berryman: it appears that in many of the cases, the damages amount to no more than the difference between the purchase price and
the market value of what is received, but I find no case binding on this court compelling the acceptance of such a measure as a RoL
-Berryman: in my view the law should not support a rule which gives exceptional protection to solicitors from the general principles of
damages which flow from either contractual or tortious responsibilities
-extent of recovery for damages from breach of contract is described in the words of Baron Alderson in Hadley v Baxendale (1854)**
-where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in
respect of such breach of contract should be such as may fairly and reasonably be considered either arising naturally
-Sir Robin Cooke “Remoteness of Damages and Judicial Discretion”: The purpose of the law is to ensure, that the plaintiff is in the
same position as he would have enjoyed if his rights had not been violated by the defendant. Any damage of which the defendant’s tort
or breach of contract is a substantial cause is prima facie recoverable. Nevertheless, as between the parties it may be just, on the facts of
any given case, to limit the damages by excluding certain heads; and in determining that question in any given case the court should
have regard to a range of considerations. The main relevant considerations have already emerged from the case law and are somewhat
as follows:
(i) The degree of likelihood that such damage, or damage of broadly the same kind, would be caused by such an act or
omission. In all cases this should be considered from the point of view of a reasonable man in the defendant’s position
immediately before the act or omission in question; but in contract an assessment as at the date of the contract will also be
relevant
(ii) The directness or otherwise of the causation and its potency. Intervening human action comes in under this head.
(iii) The nature of the damage—whether to person, property or purely economic interests.
(iv) The degree of the defendant’s culpability: for example, whether his action was deliberate or grossly negligent at the one
extreme or in venial breach of a minor but strict contractual duty on the other.
(v) Whether the defendant had a reasonable opportunity of limiting his liability by an agreed term
-*An avowed discretionary approach would not necessarily make the law any more certain, in the sense of making the results of cases
more predictable. But perhaps it would do something in that direction by reducing distraction and bringing into a more direct light the
kind of considerations which tend to sway decisions. It should have the definite advantage of making it easier for a court to do justice
without straining to fit the facts into old or new formulae. And it should also make decisions at first instance rather less vulnerable to
challenge. The ordinary principles governing appellate review of discretionary decisions, liberal enough at the present day, would
apply. A decision could be set aside if—but only if—it gave no or insufficient weight to relevant considerations or were shown to have
resulted in an injustice. Perhaps an appellate judge may be permitted to say that such limitations on the appellate court as are involved
in that proposition are not unhealthy.
III. Certainty and Causation
-Schrump v Koot (1977): **this case raised whether ‘possibilities’ as contrasted with ‘probabilities’ of future loss or damage resulting
from a present injury are to be taken into account in the assessment of a plaintiff’s damages
-The appellants had admitted liability for a motor vehicle collision which occurred on January 3, 1974. The respondent, a 61-
year-old housewife at the time of trial with a life expectancy of 20.5 years, suffered, in addition to less serious injuries, a
severe compression fracture of the 5th lumbar vertebra compressed to about one-half the normal height. The course of
hospitalization and treatment and the prolonged disability of the respondent are not in dispute at this stage of the litigation.
While the experts who gave evidence at trial were in agreement that the respondent suffers from a permanent, persistent
backache, they expressed differing prognoses on her future expectations
-it may be necessary for a plaintiff to prove, on the balance of probabilities, that the tortious act or omission was the effective cause of
the harm suffered, it is not necessary for him to prove, on the balance of probabilities, that future loss or damage will occur, but only
that there is a reasonable chance of such loss or damage occurring.
-The distinction is made clear in the following passages in 12 Hals., 4th ed., pp. 437, 483-4:
1137. Whilst issues of fact relating to liability must be decided on the balance of probability, the law of damages is concerned
with evaluating, in terms of money, future possibilities and chances. In assessing damages which depend on the court’s view
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, as to what will happen in the future, or would have happened in the future if something had not happened in the past, the court
must make an estimate as to what are the chances that a particular thing will happen or would have happened and reflect those
chances, whether they are more or less than even, in the amount of damages which it awards.
1199. Proof of damage. ... The plaintiff must prove his damage on a balance of probabilities. In many cases, however, the
court is called upon to evaluate chances, such as the chance of a plaintiff suffering further loss or damage in the future; in
these cases the plaintiff need only establish that he has a reasonable, as distinct from a speculative, chance of suffering such
loss or damage, and the court must then assess the value of that chance
-**This principle applies regardless of the percentage of possibility, as long as it is a substantial one, and regardless of whether the
possibility is favour-able or unfavourable. Thus, future contingencies which are less than probable are regarded as factors to be
considered, provided they are shown to be substantial and not speculative: may tend to increase or reduce the award in a proper case.
-proper test to be applied is discussed in Davies v Taylor [1974] AC 207 - This case involved an assessment of damages under fatal
accident legislation. It was held that the plaintiff, who had deserted her husband some time before his death, had to prove that there was
a significant prospect, as opposed to a mere speculative possibility, of a reconciliation with her husband if he had lived.
-Lord Reid observed: When the question is whether a certain thing is or is not true—whether a certain event did or did not
happen—then the court must decide one way or the other. There is no question of chance or probability. Either it did or it did
not happen. But the standard of civil proof is a balance of probabilities. If the evidence shows a balance in favour of it having
happened then it is proved that it did in fact happen.
-But here we are not and could not be seeking a decision either that the wife would or that she would not have returned to her
husband. You can prove that a past event happened, but you cannot prove that a future event will happen and I do not think
that the law is so foolish as to suppose that you can. All that you can do is to evaluate the chance.
-**If the balance of probability were the proper test what is to happen in the two cases which I have supposed of a 60 per cent and a
40 per cent probability. The 40 per cent. case will get nothing but what about the 60 per cent case. It would be almost absurd to say that
the 40 per cent case gets nothing while the 60 per cent case award is scaled down to that proportion of what the award would have been
if the spouses had been living together. That would be applying two different rules to the two cases. So I reject the balance of
probability test in this case
-*Kovats v. Ogilvie (1970), - Robertson JA is accurately summarized in the headnote [WWR]:
**In assessing damages for personal injuries the award may cover not only all injur-ies actually suffered and disabilities
proved as of the date of trial, but also the “risk” or “likelihood” of future developments attributable to such injuries. ; he may
be compensated if he proves in accordance with the degree of proof required in civil matters that there is a possibility or a
danger of some adverse future development.
-*Snell v Farrell [1990]: issue of law in this case is whether the plaintiff in a malpractice suit must prove causation in accordance with
traditional principles or whether recent developments in the law justify a finding of liability on the basis of some less onerous standard.
The practical effect of a determination of this issue will be whether the appellant was liable for the loss by the respondent of the vision
in her right eye.
-Facts: During surgery, there was a bleed behind the eyeball so the surgeon waited 30 minutes and proceeded. There was damage to the
optic nerve in the next 9 months, which resulted in blindness in that eye.
Issue: 1. Is the burden of proof of causation in a medical malpractice case on the plaintiff and, if so, how is it satisfied?
2. If the burden of proof of causation is on the plaintiff, did the trial judge infer causation in this case and, if not, ought he to
have done so
-Analysis: Damage to the optic nerve could have occurred naturally or been the result of continuing the operation.
-Principles of causation: legal or ultimate burden of proof is determined by substantive law upon reasons of experience and fairness –
1) onus on person asserting proposition 2) where the subject matter of the allegation lies particularly within the knowledge of one party,
that party may be required to prove it. Legal burden lies with P, but in the absence of evidence to the contrary brought forward by D, an
inference of causation may be drawn although positive or scientific proof of causation has not been adduced. Not necessary for medical
experts to provide a firm opinion supporting P’s theory of causation – balance of probabilities. Trial judge erred in not appreciating that
you do not need a firm medical opinion.
-Holding: appeal dismissed – P wins.
Causation: Principles
- McGhee purports to depart from traditional principles in the law of torts that the plaintiff must prove on a balance of probabilities
that, but for the tortious conduct of the defendant, the plaintiff would not have sustained the injury complained of
-traditional approach to causation has come under attack in a number of cases in which there is concern that due to the complexities of
proof, the probable victim of tortious conduct will be deprived of relief. This concern is strongest in circumstances in which, on the
basis of some percentage of statistical probability, the plaintiff is the likely victim of the combined tortious conduct of a number of
defendants, but cannot prove causation against a specific defendant or defendants on the basis of particularized evidence in accordance
with traditional principles
-challenge to the traditional approach has manifested itself in cases dealing with non-traumatic injuries such as man-made diseases
resulting from the wide-spread diffusion of chemical products, including product liability cases in which a product which can cause
injury is widely manufactured and marketed by a large number of corporations.
3
, -legal or ultimate burden of proof is determined by the substantive law “upon broad reasons of experience and fairness”: J.H. Wigmore,
Evidence in Trials at Common Law. In a civil case, the two broad principles are:
1. that the onus is on the party who asserts a proposition, usually the plaintiff;
2. that where the subject-matter of the allegation lies particularly within the knowledge of one party, that party may be
required to prove it.
-**McGhee case and its influence on subsequent cases, particularly in the medical malpractice field
-question that this court must decide is whether the traditional approach to causation is no longer satisfactory in that plaintiffs in
malpractice cases are being deprived of compensation because they cannot prove causation where it in fact exists.
- Causation is an expression of the relationship that must be found to exist between the tortious act of the wrongdoer and the injury to
the victim in order to justify compensation of the latter out of the pocket of the former. Reversing the burden of proof may be justified
where two defendants negligently fire in the direction of the plaintiff and then by their tortious conduct destroy the means of proof at
his disposal. In such a case it is clear that the injury was not caused by neutral conduct. It is quite a different matter to compensate a
plaintiff by reversing the burden of proof for an injury that may very well be due to factors unconnected to the defendant and not the
fault of anyone.
-I am of the opinion that the dissatisfaction with the traditional approach to causation stems to a large extent from its too rigid
application by the courts in many cases. Causation need not be determined by scientific precision. It is, as stated by Lord Salmon in
Alphacell Ltd. v. Woodward, “... essentially a practical question of fact which can best be answered by ordinary common sense rather
than abstract metaphysical theory.” Furthermore, as I observed earlier, the allocation of the burden of proof is not immutable. Both the
burden and the standard of proof are flexible concepts.
-In many malpractice cases, the facts lie particularly within the knowledge of the defendant. In these circumstances, very little
affirmative evidence on the part of the plaintiff will justify the drawing of an inference of causation in the absence of evidence to the
contrary. This has been expressed in terms of shifting the burden of proof. ...
-The legal or ultimate burden remains with the plaintiff, but in the absence of evidence to the contrary adduced by the defendant, an
inference of causation may be drawn, although positive or scientific proof of causation has not been adduced. If some evidence to the
contrary is adduced by the defendant, the trial judge is entitled to take account of Lord Mansfield’s famous precept. This is, I believe,
what Lord Bridge had in mind in Wilsher when he referred to a “robust and pragmatic approach to the ... facts”.
-It is not essential that the medical experts provide a firm opinion supporting the plaintiff’s theory of causation. Medical experts
ordinarily determine causation in terms of certainties whereas a lesser standard is demanded by the law. As pointed out in D.W.
Louisell, the phrase “in your opinion with a reasonable degree of medical certainty,” which is the standard form of question to a
medical expert, is often misunderstood.
Causation in this case -trial judge found that the appellant was negligent in continuing with the operation when retrobulbar bleeding
occurred. This finding is not contested and is fully supported by the evidence. It was common ground that the respondent’s blindness
occurred due to atrophy or death of the optic nerve which was occasioned by a stroke. There were two possible causes of the stroke,
one of which was natural and the other due to continuing the operation.
*Laferriere v Lawson [1991]
-Gontheir J: case deals with the legal consequences of a doctor’s failure to inform his patient of a cancerous condition and,
subsequently, to follow up on the patient’s health in the appropriate manner. The court is asked to consider whether an action can
succeed even where it is not proven that the patient’s fate would have been different absent the doctor’s fault. In particular, the court
must examine the theory of “perte de chance,” or loss of chance,
-Facts: L has breast cancer, diagnosed after a biopsy by Dr. Lawson, but he neglects to tell her. She dies after suffering. It is highly
unlikely that her death could have been prevented with the medical techniques available in 1971
-Issue: (1) Was Dr. Lawson responsible for L’s death? (2) was dr. Lawson responsible for injury to L?
-trial judge found no link between the Doctors fault and the death of L, no damages. CoA found cause for damages. Dr appealed
-Reasoning: Gontheir J: (1) Cancer would still have killed the victim had the doctor told her. There is thus no casual link between
negligence of the doctor and death
Dissent (La Forest) : agrees with the Court of appeal that ‘perte de chance’ is compensable. Appeal dismissed
-Holding: yes loss of chance, but rather moral damages and quality of life. $10,000 for moral damages, and $7,500 for quality of life
-ration: rejection of the loss of chance argument in Quebec civil law
Sunrise Co v Lake Winnipeg (The) [1991]
- On June 7, 1980, the “Kalliopi L,” while downbound on the St. Lawrence River, met but did not collide with, the upbound “Lake
Winnipeg.” Immediately after the meeting, the “Kalliopi L” went aground. The trial judge found that the “Lake Winnipeg” and her
owners were entirely responsible for this grounding. In proceeding to an anchorage area, the “Kalliopi L” again, though through no
fault of the “Lake Winnipeg,” went aground and suffered further damage. The second incident was unrelated to the first. Each
grounding alone would have required the “Kalliopi L” to proceed immediately to dry dock for repairs once her cargo had been
discharged. The time in dry dock necessitated by damage repairs occasioned by both incidents was 27 days. The detention in dry dock
for repairs from the first incident alone would have required the full 27 days. If, however, repairs relating to the second incident were
carried out separately, only 14 days in dry dock would have been necessary. Liability for the cost of repairs is not an issue in the
principal appeal as each party assumed responsibility for these costs. The loss in dispute is that resulting from the detention of the ship.
4
I. Introduction
-purpose of an award of damages is to put the party complaining in the position that he or she would have occupied if the wrong had
not been done
-Livingstone v Rawyards Coal Co (1880): where any injury is to be compensated by damages, in settling the sum of money to be
given for reparation of damages you should as nearly as possible get at that sum of money which will put the party who has been
injured, or who has suffered, in the same position as he would have been in if he had not sustained the wrong for which he is now
getting his compensation or reparation -this principle is not self-applying
-The ‘Columbus’ (1849) (HC Admir): I apprehend the general rule of law is, that where an injury is committed by one individual to
another ... the party receiving the injury is entitled to an indemnity for the same. But although this is the general principle of law, all
Courts have found it necessary to adopt certain rules for the application of it; and it is utterly impossible, in all the various cases that
may arise, that the remedy which the law may give should always be the precise amount of the loss or injury sustained. In many cases it
will, of necessity, exceed, in others fall short of the precise amount
-*chief limiting principles are remoteness, uncertainty, and mitigation
-**the plaintiff must establish, on the balance of probabilities, that he has suffered a loss and that the loss has been caused by the
defendant’s wrong – but, if all such losses were to be compensated defendants would be liable for very unexpected consequences
-Vancouver’s Island Spar Lumber & Saw-Mill Co Ltd v Nettleship (1868) – where a man going to be married to an heiress,
his horse having cast a show on the journey, employed a blacksmith to replace it, who did the work so unskillfully that the
horse was lamed, and, the rider not arriving in time, the lady married another; and the blacksmith was held liable for the loss
of the marriage
-since the 19th century, it has been recognized that a limit is necessary, but it has not been easy to formulate the principle to explain and
predict which kinds of losses will be classified as legally too remote and which will not
II. Remoteness
-H Parsons (livestock) Ltd v Uttley Ingham & Co Ltd [1978] QB 791 (CA):
-facts: The defendant sold a hopper for storing pig food to the plaintiff for the plaintiff’s pigs. In installing the hopper, the defendant
failed to open a ventilator, with the result that the pignuts became mouldy, and the pigs were affected by the intestinal infection
-*found that the lack of top ventilation in the hopper caused the condition, but it is the defendants’ case that at the time of contract the
parties could not have reasonably contemplated that nuts, rendered moldy by lack of hopper ventilation, would cause serious illness
such as E. coli in the pigs that fed on them
-judge: found that there was a warranty—its existence is not disputed by the defendants—to the effect that the hopper should be
reasonably fit for the purpose of storing pignuts in a condition suitable for feeding to the plaintiffs’ pigs. He found that the hopper,
being unventilated, was not so fit; and this defect was a breach of the warranty, and that the pignuts were unfit by reason of the breach.
He found that the plaintiffs’ loss was caused by the breach of warranty.
The Law as to Remoteness
-C Czarnikow Ltd v Koufos (1969) HoL said, in remoteness of damage, there is a difference between contract and tort. In the case of a
breach of contract, the court has to consider whether the consequences were of such a kind that a reasonable man, at the time of
making the contract, would contemplate them as being a very substantial degree of probability
-in the case of a tort, the court has to consider whether the consequences were of such a kind that a reasonable man, at the time of the
tort committed, would foresee them as being of a much lower degree of probability.
-sufficent if the consequences are liable to happen in the most unusual case or in a very improbable case or that they may
happen as a result of the breach, however, unlikely it may be, unless it can be brushed aside as far fetched
-Berryman finds it difficult to apply those principles universally to all cases of contract or to all cases of tort; and to draw a distinction
between what a man contemplates and what he foresees
-to say nothing of the different degrees of probability—especially when the cause of action can be laid either in contract or in tort. I am
swept under by the conflicting currents. I go back with relief to the distinction drawn in legal theory by Professors Hart and Honore in
their book Causation in the Law. They distinguish between those cases in contract in which a man has suffered no damage to person or
property, but only economic loss, such as loss of profit or loss of opportunities for gain in some future transaction: and those in which
he claims damages for an injury actually done to his person or damage actually done to his property (including his livestock) or for
ensuing expense (damnum emergens) to which he has actually been put.
-In the law of tort, there is emerging a distinction between economic loss and physical damage: see Spartan Steel & Alloys Ltd. v.
Martin & Co. (Contractors) Ltd., [1973] QB 27. - any 'pure' economic loss suffered in addition to physical damage are unrecoverable as
either too remote, or outside the scope of the duty of care. However, economic losses consequential on the damage to the metal in the
melt (such as lost profits on the damaged metal) were recoverable.
Loss of Profit Cases
-the defaulting party is only liable for the consequences if they are such as, at the time of the contract, he ought reasonably to have
contemplated as a serious possibility or real danger. You must assume that, at the time of the contract, he had the very kind of breach in
1
,mind—such a breach as afterwards happened, as for instance, delay in transit—and then you must ask: ought he reasonably to have
contemplated that there was a serious possibility that such a breach would involve the plaintiff in loss of profit? If yes, the contractor is
liable for the loss unless he has taken care to exempt himself from it by a condition in the contract—as, of course, he is able to do if it
was the sort of thing which he could reasonably contemplate. The law on this class of case is now covered by the three leading cases of
Hadley v. Baxendale; Victoria Laundry (Windsor) Ltd. v. Newman Industries Ltd., [1949] 2 KB 528 (CA); and C. Czarnikow Ltd. v.
Koufos. These were all “loss of profit” cases: and the test of “reasonable contemplation” and “serious possibility” should, I suggest, be
kept to that type of loss or, at any rate, to economic loss.
Physical Damage Case
-the defaulting party is liable for any loss or expense which he ought reasonably to have foreseen at the time of the breach as a possible
consequence, even if it was only a slight possibility. You must assume that he was aware of his breach, and then you must ask: ought
he reasonably to have foreseen, at the time of the breach, that some-thing of this kind might happen in consequence of it? This is the
test which has been applied in cases of tort ever since The Wagon Mound cases, [1961] AC 388. But there is a long line of cases which
support a like test in cases of contract.
-Kienzle v Stringer (1981): sole issue at trial and on this appeal is the quantum of the plaintiff’s damages
-Berryman: it appears that in many of the cases, the damages amount to no more than the difference between the purchase price and
the market value of what is received, but I find no case binding on this court compelling the acceptance of such a measure as a RoL
-Berryman: in my view the law should not support a rule which gives exceptional protection to solicitors from the general principles of
damages which flow from either contractual or tortious responsibilities
-extent of recovery for damages from breach of contract is described in the words of Baron Alderson in Hadley v Baxendale (1854)**
-where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in
respect of such breach of contract should be such as may fairly and reasonably be considered either arising naturally
-Sir Robin Cooke “Remoteness of Damages and Judicial Discretion”: The purpose of the law is to ensure, that the plaintiff is in the
same position as he would have enjoyed if his rights had not been violated by the defendant. Any damage of which the defendant’s tort
or breach of contract is a substantial cause is prima facie recoverable. Nevertheless, as between the parties it may be just, on the facts of
any given case, to limit the damages by excluding certain heads; and in determining that question in any given case the court should
have regard to a range of considerations. The main relevant considerations have already emerged from the case law and are somewhat
as follows:
(i) The degree of likelihood that such damage, or damage of broadly the same kind, would be caused by such an act or
omission. In all cases this should be considered from the point of view of a reasonable man in the defendant’s position
immediately before the act or omission in question; but in contract an assessment as at the date of the contract will also be
relevant
(ii) The directness or otherwise of the causation and its potency. Intervening human action comes in under this head.
(iii) The nature of the damage—whether to person, property or purely economic interests.
(iv) The degree of the defendant’s culpability: for example, whether his action was deliberate or grossly negligent at the one
extreme or in venial breach of a minor but strict contractual duty on the other.
(v) Whether the defendant had a reasonable opportunity of limiting his liability by an agreed term
-*An avowed discretionary approach would not necessarily make the law any more certain, in the sense of making the results of cases
more predictable. But perhaps it would do something in that direction by reducing distraction and bringing into a more direct light the
kind of considerations which tend to sway decisions. It should have the definite advantage of making it easier for a court to do justice
without straining to fit the facts into old or new formulae. And it should also make decisions at first instance rather less vulnerable to
challenge. The ordinary principles governing appellate review of discretionary decisions, liberal enough at the present day, would
apply. A decision could be set aside if—but only if—it gave no or insufficient weight to relevant considerations or were shown to have
resulted in an injustice. Perhaps an appellate judge may be permitted to say that such limitations on the appellate court as are involved
in that proposition are not unhealthy.
III. Certainty and Causation
-Schrump v Koot (1977): **this case raised whether ‘possibilities’ as contrasted with ‘probabilities’ of future loss or damage resulting
from a present injury are to be taken into account in the assessment of a plaintiff’s damages
-The appellants had admitted liability for a motor vehicle collision which occurred on January 3, 1974. The respondent, a 61-
year-old housewife at the time of trial with a life expectancy of 20.5 years, suffered, in addition to less serious injuries, a
severe compression fracture of the 5th lumbar vertebra compressed to about one-half the normal height. The course of
hospitalization and treatment and the prolonged disability of the respondent are not in dispute at this stage of the litigation.
While the experts who gave evidence at trial were in agreement that the respondent suffers from a permanent, persistent
backache, they expressed differing prognoses on her future expectations
-it may be necessary for a plaintiff to prove, on the balance of probabilities, that the tortious act or omission was the effective cause of
the harm suffered, it is not necessary for him to prove, on the balance of probabilities, that future loss or damage will occur, but only
that there is a reasonable chance of such loss or damage occurring.
-The distinction is made clear in the following passages in 12 Hals., 4th ed., pp. 437, 483-4:
1137. Whilst issues of fact relating to liability must be decided on the balance of probability, the law of damages is concerned
with evaluating, in terms of money, future possibilities and chances. In assessing damages which depend on the court’s view
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, as to what will happen in the future, or would have happened in the future if something had not happened in the past, the court
must make an estimate as to what are the chances that a particular thing will happen or would have happened and reflect those
chances, whether they are more or less than even, in the amount of damages which it awards.
1199. Proof of damage. ... The plaintiff must prove his damage on a balance of probabilities. In many cases, however, the
court is called upon to evaluate chances, such as the chance of a plaintiff suffering further loss or damage in the future; in
these cases the plaintiff need only establish that he has a reasonable, as distinct from a speculative, chance of suffering such
loss or damage, and the court must then assess the value of that chance
-**This principle applies regardless of the percentage of possibility, as long as it is a substantial one, and regardless of whether the
possibility is favour-able or unfavourable. Thus, future contingencies which are less than probable are regarded as factors to be
considered, provided they are shown to be substantial and not speculative: may tend to increase or reduce the award in a proper case.
-proper test to be applied is discussed in Davies v Taylor [1974] AC 207 - This case involved an assessment of damages under fatal
accident legislation. It was held that the plaintiff, who had deserted her husband some time before his death, had to prove that there was
a significant prospect, as opposed to a mere speculative possibility, of a reconciliation with her husband if he had lived.
-Lord Reid observed: When the question is whether a certain thing is or is not true—whether a certain event did or did not
happen—then the court must decide one way or the other. There is no question of chance or probability. Either it did or it did
not happen. But the standard of civil proof is a balance of probabilities. If the evidence shows a balance in favour of it having
happened then it is proved that it did in fact happen.
-But here we are not and could not be seeking a decision either that the wife would or that she would not have returned to her
husband. You can prove that a past event happened, but you cannot prove that a future event will happen and I do not think
that the law is so foolish as to suppose that you can. All that you can do is to evaluate the chance.
-**If the balance of probability were the proper test what is to happen in the two cases which I have supposed of a 60 per cent and a
40 per cent probability. The 40 per cent. case will get nothing but what about the 60 per cent case. It would be almost absurd to say that
the 40 per cent case gets nothing while the 60 per cent case award is scaled down to that proportion of what the award would have been
if the spouses had been living together. That would be applying two different rules to the two cases. So I reject the balance of
probability test in this case
-*Kovats v. Ogilvie (1970), - Robertson JA is accurately summarized in the headnote [WWR]:
**In assessing damages for personal injuries the award may cover not only all injur-ies actually suffered and disabilities
proved as of the date of trial, but also the “risk” or “likelihood” of future developments attributable to such injuries. ; he may
be compensated if he proves in accordance with the degree of proof required in civil matters that there is a possibility or a
danger of some adverse future development.
-*Snell v Farrell [1990]: issue of law in this case is whether the plaintiff in a malpractice suit must prove causation in accordance with
traditional principles or whether recent developments in the law justify a finding of liability on the basis of some less onerous standard.
The practical effect of a determination of this issue will be whether the appellant was liable for the loss by the respondent of the vision
in her right eye.
-Facts: During surgery, there was a bleed behind the eyeball so the surgeon waited 30 minutes and proceeded. There was damage to the
optic nerve in the next 9 months, which resulted in blindness in that eye.
Issue: 1. Is the burden of proof of causation in a medical malpractice case on the plaintiff and, if so, how is it satisfied?
2. If the burden of proof of causation is on the plaintiff, did the trial judge infer causation in this case and, if not, ought he to
have done so
-Analysis: Damage to the optic nerve could have occurred naturally or been the result of continuing the operation.
-Principles of causation: legal or ultimate burden of proof is determined by substantive law upon reasons of experience and fairness –
1) onus on person asserting proposition 2) where the subject matter of the allegation lies particularly within the knowledge of one party,
that party may be required to prove it. Legal burden lies with P, but in the absence of evidence to the contrary brought forward by D, an
inference of causation may be drawn although positive or scientific proof of causation has not been adduced. Not necessary for medical
experts to provide a firm opinion supporting P’s theory of causation – balance of probabilities. Trial judge erred in not appreciating that
you do not need a firm medical opinion.
-Holding: appeal dismissed – P wins.
Causation: Principles
- McGhee purports to depart from traditional principles in the law of torts that the plaintiff must prove on a balance of probabilities
that, but for the tortious conduct of the defendant, the plaintiff would not have sustained the injury complained of
-traditional approach to causation has come under attack in a number of cases in which there is concern that due to the complexities of
proof, the probable victim of tortious conduct will be deprived of relief. This concern is strongest in circumstances in which, on the
basis of some percentage of statistical probability, the plaintiff is the likely victim of the combined tortious conduct of a number of
defendants, but cannot prove causation against a specific defendant or defendants on the basis of particularized evidence in accordance
with traditional principles
-challenge to the traditional approach has manifested itself in cases dealing with non-traumatic injuries such as man-made diseases
resulting from the wide-spread diffusion of chemical products, including product liability cases in which a product which can cause
injury is widely manufactured and marketed by a large number of corporations.
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, -legal or ultimate burden of proof is determined by the substantive law “upon broad reasons of experience and fairness”: J.H. Wigmore,
Evidence in Trials at Common Law. In a civil case, the two broad principles are:
1. that the onus is on the party who asserts a proposition, usually the plaintiff;
2. that where the subject-matter of the allegation lies particularly within the knowledge of one party, that party may be
required to prove it.
-**McGhee case and its influence on subsequent cases, particularly in the medical malpractice field
-question that this court must decide is whether the traditional approach to causation is no longer satisfactory in that plaintiffs in
malpractice cases are being deprived of compensation because they cannot prove causation where it in fact exists.
- Causation is an expression of the relationship that must be found to exist between the tortious act of the wrongdoer and the injury to
the victim in order to justify compensation of the latter out of the pocket of the former. Reversing the burden of proof may be justified
where two defendants negligently fire in the direction of the plaintiff and then by their tortious conduct destroy the means of proof at
his disposal. In such a case it is clear that the injury was not caused by neutral conduct. It is quite a different matter to compensate a
plaintiff by reversing the burden of proof for an injury that may very well be due to factors unconnected to the defendant and not the
fault of anyone.
-I am of the opinion that the dissatisfaction with the traditional approach to causation stems to a large extent from its too rigid
application by the courts in many cases. Causation need not be determined by scientific precision. It is, as stated by Lord Salmon in
Alphacell Ltd. v. Woodward, “... essentially a practical question of fact which can best be answered by ordinary common sense rather
than abstract metaphysical theory.” Furthermore, as I observed earlier, the allocation of the burden of proof is not immutable. Both the
burden and the standard of proof are flexible concepts.
-In many malpractice cases, the facts lie particularly within the knowledge of the defendant. In these circumstances, very little
affirmative evidence on the part of the plaintiff will justify the drawing of an inference of causation in the absence of evidence to the
contrary. This has been expressed in terms of shifting the burden of proof. ...
-The legal or ultimate burden remains with the plaintiff, but in the absence of evidence to the contrary adduced by the defendant, an
inference of causation may be drawn, although positive or scientific proof of causation has not been adduced. If some evidence to the
contrary is adduced by the defendant, the trial judge is entitled to take account of Lord Mansfield’s famous precept. This is, I believe,
what Lord Bridge had in mind in Wilsher when he referred to a “robust and pragmatic approach to the ... facts”.
-It is not essential that the medical experts provide a firm opinion supporting the plaintiff’s theory of causation. Medical experts
ordinarily determine causation in terms of certainties whereas a lesser standard is demanded by the law. As pointed out in D.W.
Louisell, the phrase “in your opinion with a reasonable degree of medical certainty,” which is the standard form of question to a
medical expert, is often misunderstood.
Causation in this case -trial judge found that the appellant was negligent in continuing with the operation when retrobulbar bleeding
occurred. This finding is not contested and is fully supported by the evidence. It was common ground that the respondent’s blindness
occurred due to atrophy or death of the optic nerve which was occasioned by a stroke. There were two possible causes of the stroke,
one of which was natural and the other due to continuing the operation.
*Laferriere v Lawson [1991]
-Gontheir J: case deals with the legal consequences of a doctor’s failure to inform his patient of a cancerous condition and,
subsequently, to follow up on the patient’s health in the appropriate manner. The court is asked to consider whether an action can
succeed even where it is not proven that the patient’s fate would have been different absent the doctor’s fault. In particular, the court
must examine the theory of “perte de chance,” or loss of chance,
-Facts: L has breast cancer, diagnosed after a biopsy by Dr. Lawson, but he neglects to tell her. She dies after suffering. It is highly
unlikely that her death could have been prevented with the medical techniques available in 1971
-Issue: (1) Was Dr. Lawson responsible for L’s death? (2) was dr. Lawson responsible for injury to L?
-trial judge found no link between the Doctors fault and the death of L, no damages. CoA found cause for damages. Dr appealed
-Reasoning: Gontheir J: (1) Cancer would still have killed the victim had the doctor told her. There is thus no casual link between
negligence of the doctor and death
Dissent (La Forest) : agrees with the Court of appeal that ‘perte de chance’ is compensable. Appeal dismissed
-Holding: yes loss of chance, but rather moral damages and quality of life. $10,000 for moral damages, and $7,500 for quality of life
-ration: rejection of the loss of chance argument in Quebec civil law
Sunrise Co v Lake Winnipeg (The) [1991]
- On June 7, 1980, the “Kalliopi L,” while downbound on the St. Lawrence River, met but did not collide with, the upbound “Lake
Winnipeg.” Immediately after the meeting, the “Kalliopi L” went aground. The trial judge found that the “Lake Winnipeg” and her
owners were entirely responsible for this grounding. In proceeding to an anchorage area, the “Kalliopi L” again, though through no
fault of the “Lake Winnipeg,” went aground and suffered further damage. The second incident was unrelated to the first. Each
grounding alone would have required the “Kalliopi L” to proceed immediately to dry dock for repairs once her cargo had been
discharged. The time in dry dock necessitated by damage repairs occasioned by both incidents was 27 days. The detention in dry dock
for repairs from the first incident alone would have required the full 27 days. If, however, repairs relating to the second incident were
carried out separately, only 14 days in dry dock would have been necessary. Liability for the cost of repairs is not an issue in the
principal appeal as each party assumed responsibility for these costs. The loss in dispute is that resulting from the detention of the ship.
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