Damages in contract and the injured party’s contribution to its own loss

Presented by Dr Wayne Courtney

In awarding compensation for breach of contract, the law pays regard to the injured party’s involvement in events resulting in its loss. Familiar principles include intervening causation, mitigation (particularly, the avoidable loss rule) and contributory negligence. The second of these tends to feature more prominently in the law of contract than the first. But some judges and commentators say that the avoidable loss rule is merely an aspect of intervening causation.

The purpose of the lecture is to explore this relationship. It will do so principally by considering three questions. Are the avoidable loss rule and intervening causation similar in their ‘mechanics’, that is, the way they apply to reduce a claimed loss? Do they evaluate the injured party’s conduct against the same standard? Why does the law seem to prefer causation for resolving some commonplace situations, and mitigation for others?

Dr Wayne Courtney is an Associate Professor at the National University of Singapore, a Senior Fellow at the University of Melbourne and was previously an Associate Professor at Sydney Law School. He researches in contract law and has broader interests in commercial law and private law. He is the author of two books (Contractual Indemnities and The Modern Contract of Guarantee (English edition)) and numerous articles. Wayne’s work has been cited by the High Court of Australia, the Supreme Court of the United Kingdom, the Supreme Court of New Zealand and by other courts around the Commonwealth. He is a member of the editorial board of the Journal of Contract Law and section co-editor for the Journal of Banking and Finance Law and Practice.