What is the test for determining whether a carrier is liable for delay and/or breach of contract for delay in delivering goods to a miller?

Saskatchewan, Canada


The following excerpt is from Borstmayer v. Cyclone Ford Sales Ltd., 2004 SKPC 94 (CanLII):

Even had there been a breach of contract or of a provision of The Sale of Goods Act, I am of the view that the rule in Hadley v. Baxendale, referred to in Waddams, The Law of Contract, 4th at para. 735 is applicable to the circumstances of the present case: The leading case, Hadley v. Baxendale, concerned a contract to carry a mill shaft to serve as a pattern for a new one that was needed. The carrier’s delay caused the mill to be stopped for longer than it other- wise would have been, but the court held that the carrier was not liable for the miller’s consequent loss of profits. The court attempted to set up tests based on foreseeability. The contract breaker ought to be liable for such damages as “may fairly and reasonably be considered either arising naturally, i.e. according to the usual course of things from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. Now, if the special circumstances under which the contract was actually made were communicated by the plaintiffs to the defendant, and thus known to both parties, the damages resulting from the breach of such a contract, which they would reasonably contemplate, would be the amount of injury which would ordinarily follow from such breach of contract under these special circumstances so known and communicated”. (My emphasis). (Citations omitted).

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