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{{g}}[[Consequential loss]], sometimes called [[indirect loss]], [[relational economic loss]], [[loss of opportunity]] or [[loss of profits]] is a loss arising from a [[breach of contract]] not caused ''directly'' by the breach, but is a second-order consequence of it: such as the [[opportunity cost]] to the innocent party of having a contract with you which you then breached. | {{a|g|[[File:Dramatic Chipmunk.png|thumb|Seems like a suitable place for the ''[[dramatic look gopher]]''. DID SOMEONE SAY CONSEQUENTIAL LOSS??]]}}[[Consequential loss]], sometimes called [[indirect loss]], [[relational economic loss]], [[loss of opportunity]] or [[loss of profits]] is a loss arising from a [[breach of contract]] not caused ''directly'' by the breach, but is a second-order consequence of it: such as the [[opportunity cost]] to the innocent party of having a contract with you which you then breached. | ||
Had I not been committed to rent you my car, I could have rented it to someone else ''for more money''. | Had I not been committed to rent you my car, I could have rented it to someone else ''for more money''. | ||
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===Indemnities=== | ===Indemnities=== | ||
Pay particular attention to [[indemnities]]. where not [[Well-crafted indemnity|well-crafted]], as many are not, indemnities are oddly susceptible for consequential losses, because [[indemnities]] do not require a [[breach of contract]], and the usual rules of remoteness and foreseeability do not (in theory) apply. Badly constructed indemnities are likely to be treated rather like contractual breaches however, but where an indemnity is very wide (as many are) it is not controversial to exclude liability for consequential and indirect losses, and if your counterparty baulks at this, most likely she doesn’t really understand indemnities. Many lawyers don’t. | Pay particular attention to [[indemnities]]. where not [[Well-crafted indemnity|well-crafted]], as many are not, indemnities are oddly susceptible for consequential losses, because [[indemnities]] do not require a [[breach of contract]], and the usual rules of remoteness and foreseeability do not (in theory) apply. Badly constructed indemnities are likely to be treated rather like contractual breaches however, but where an indemnity is very wide (as many are) it is not controversial to exclude liability for consequential and indirect losses, and if your counterparty baulks at this, most likely she doesn’t really understand indemnities. Many lawyers don’t. | ||
Trying to recovering [[consequential losses]] for [[breach]] through sneaky [[indemnities]] is dick behaviour, basically, and another reason one should never agree to indemnities for [[breach of contract]]. | |||
''There is more — much more — on this topic at the [[indemnities]] article.'' | ''There is more — much more — on this topic at the [[indemnities]] article.'' | ||
===When consequential losses are foreseeable: [[stock lending]]=== | ===When [[consequential losses]] ''are'' foreseeable: [[stock lending]]=== | ||
Sometimes consequential losses ''are'' within the parties’ reasonable contemplation, they are easy enough to calculate, and it is fair enough to include them. Such as, upon a failure to settle a [[stock loan]]. The failure to make the onward delivery might incur a {{gmslaprov|buy-in}} cost from the onward recipient. | Sometimes consequential losses ''are'' within the parties’ reasonable contemplation, they are easy enough to calculate, and it is fair enough to include them. Such as, upon a failure to settle a [[stock loan]]. The failure to make the onward delivery might incur a {{gmslaprov|buy-in}} cost from the onward recipient. | ||
=== | ===When [[consequential losses]] are all you can realisticallt claim: [[confidentiality agreement]]s=== | ||
The accursed [[NDA]] where, if you can really claim [[contractual damages]]<ref>[[Damages]] arising from misuse of [[intellectual property]] aren’t at their core, [[contractual damages]], because [[intellectual property]] rights don’t arise by {{tag|contract}} — well, not a [[confi]] at any rate.</ref> at all, they are all likely to | The accursed [[NDA]] where, if you can really claim [[contractual damages]]<ref>[[Damages]] arising from misuse of [[intellectual property]] aren’t at their core, [[contractual damages]], because [[intellectual property]] rights don’t arise by {{tag|contract}} — well, not under a [[confi]] at any rate.</ref> at all, they are all likely to [[Consequential loss|consequential]] and speculative in nature. | ||
The chap who had your client list and used it to win business you aspired to win yourself has, at worst, caused you a consequential loss: the [[loss of profits]] from that business. But more likely, {{sex|he}} has not “caused” your [[loss]] at all: ''you'' have, through your crappy product. Look, I’m just the messenger, okay?<br> | |||
{{sa}} | {{sa}} | ||
{{casenote|Hadley|Baxendale}} | {{casenote|Hadley|Baxendale}} |