Robinson v Harman
Court of Exchequer
Citations: (1848) 1 Exchequer Reports (Welsby, Hurlstone and Gordon) 850; (1848) 154 ER 363.
The defendant contracted to provide the claimant a valid lease over a house and associated land for twenty-one years. In return, the claimant would pay yearly rent. The defendant reneged on the agreement and refused to grant the lease. This was because he did not have proper title to grant that lease. As a result, the claimant lost out on profits he would have gotten from using the land. The claimant sued to recover the lost profits.
- Could the claimant recover damages for loss of profit in contract law?
The Court held in favour of the claimant. They were entitled to recover damages for the lost bargain.
This Case is Authority For…
Parke B set out the classic formulation of the purposes of contract damages:
‘[W]here a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.’
Therefore, if a claimant would have received profits if the contract had been performed, those lost profits are recoverable.