FORESEEABILITY AND ASSESSMENT OF DAMAGES
Issues of foreseeability and assessment of damages arose in the
Privy Council case
Alcoa Minerals of Jamaica Inc v Herbert Broderick  UKPC 11;  BLR 729. The
facts were that emissions from the Appellant's smelting plant had caused
corrosion to the galvanised zinc panels of the roof of the Respondent's
house and other injury to his property and to his health. When the damage
first occurred the Respondent had repaired it but by 1989 the damage had
occurred again and he was not able to pay for the necessary repairs. In
the statement of claim (1990) the Respondent claimed $211140, being 1564m2
@ $135/sq ft, in respect of building repair costs. As a result of rapid
inflation and a dramatic fall in value of the Jamaican dollar, however,
the repair costs had (by 1994) increased to $938400 ($600/sq ft).
"Lord Wright in The Liesbosch thought in the alternative that the owners of the dredger's financial embarrassment was too remote [ie, unforeseeable by the wrongdoer]. In the present case it seems to their Lordships to have been obviously foreseeable that if the house of a person in the position of Mr. Broderick was seriously damaged he would not or might not have the wherewithal to repair it and that his ability to do so would depend on his establishing the liability of, and recovering damages from, the defendant."
as to whether Mr Broderick had failed to mitigate his loss is also one
of foreseeability. Whether a wrongdoer should be liable/should be taken
to have foreseen a claimant's consequential act/failure to act depends
on whether the claimant acted reasonably (by what he did or by what
he failed to do) in the circumstances in which he was placed as a result
of the breach. An issue might arise in the construction context, for
example, as to whether a contractor had acted reasonably by steps taken/not
taken with regard to the avoidance/mitigation of delay. 2 important factors
to be aware of concerning this issue are that:
"Even assuming that he could have raised the loan, by waiting and not borrowing money at a high rate of interest for some six years the plaintiff was not in breach of his duty to mitigate. It seems to their Lordships as it apparently seemed both to the judge and the Court of Appeal that Mr. Broderick behaved reasonably in waiting, if indeed he had any realistic choice to do anything but wait, until money was available from Alcoa."
aspect of the Alcoa case is that in their Lordships' view a wrongdoer's
conduct in denying liability will in many cases be a crucial factor/circumstance
in determining whether a claimant should be regarded as having acted unreasonably
in not having repairs carried out at an earlier date (see also
Dodd Properties (Kent) Ltd v Canterbury City Council  EWCA Civ 4). Although the
issue is one of fact, it might be expected that a claimant will be taken
to have acted reasonably at least in cases where, in the words of Lord Slynn, "repairs have to be done at what is a heavy cost in relation
to the plaintiff's financial position."
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This article was published in the RICS journal Chartered Surveyor Monthly January 2001
The report of the Alcoa case is available on-line at
Copyright Stewart Dunn except:
Extracts from Privy Council or House of Lords judgments and opinions are reproduced with the permission of the Controller of Her Majesty's Stationery Office on behalf of Parliament
Extracts from cases reported in The Weekly Law Reports and The Law Reports are reproduced with the permission of The Incorporated Council of Law Reporting for England and Wales.