What is the test for recoverable damages for breach of contract?
Canada (Federal), Canada
The following excerpt is from Fraser Shipyard and Industrial Centre Ltd. v. Atlantis Two (The), 1999 CanLII 8369 (FC):
The rule in Hadley v. Baxendale lays down two circumstances in which damages for breach of contract are recoverable. First, when damages arise naturally, in the usual course of things, from the breach and second, when damages have been reasonably contemplated by the parties at the time they made the contract, as a probable result of a breach. This seeming dichotomy has been modified and explained somewhat over the years.
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