Cases - Technotrade Ltd v Larkstore Ltd
Record details
- Name
- Technotrade Ltd v Larkstore Ltd
- Date
- [2006]
- Citation
- EWCA Civ 1079
- Legislation
- Keywords
- Contract administration
- Summary
-
Of course, if the contract allows, a party may find that his contractual rights and obligations have been assigned by the original employer to another party. This case found that in circumstances where the cause of action had been transferred but the loss had not, the party to whom the rights of action had been assigned could still recover substantial damages.
The defendant surveying company were unsuccessful in their appeal against a finding of liability in respect of breach of contract in connection with an inadequate site report which they produced for a proposed residential development. The defendant's report was provided pursuant to a contract with the original owner of the development who had subsequently sold the land to the claimant prior to the start of construction. During the construction works a landslip occurred which damaged some of the properties being constructed. The original owner then assigned to the claimant its rights and benefits under the report.
It was held at first instance and on appeal that the claimant, as the assignee of the original cause of action for breach of contract, could bring a claim for substantial damages in respect of the losses caused by the landslip against the defendant.
The court reasoned that the assignment had transferred the cause of action that the original owner had the benefit of (including any remedy in damages), although it had not transferred the loss itself which had been suffered before the assignment when the landslip occurred. The remedy of damages for a breach of contract was not to be limited as a matter of principle to the loss sustained as at the date of the breach of contract or at any particular time thereafter. Further, it was held that the principle that an assignee could not recover more than his assignor should not apply on the facts of the case as it was not intended to permit the contract breaker to avoid all liability by placing the loss that had been sustained into a legal black hole.