Edelman J

Steward J
Gleeson J
Beech-Jones J

41.

120 In summary, this understanding of consequential loss for breach of contract

has the following effects:

1. When calculating the consequential loss suffered by a plaintiff due to a

defendant's breach of contract, the goal, in general terms, is to put the
plaintiff in same the position as if the contract had been performed.

2. The calculation of a plaintiff's consequential loss will permit the plaintiff to

recover expenditure reasonably incurred in anticipation of, or reliance on,
the performance of the contractual obligation that was breached but only to
the extent that the expenditure would have been recovered but cannot now
be recovered ("wasted expenditure"). Of course, the plaintiff can also
recover any additional profit that would have been obtained from the
contract but, in this event, the plaintiff would simply focus on the total
profits that would have been made, with the wasted expenditure merely
being an expense in the production of those profits.

3. In assessing the loss that can be recovered, that loss which is due to
unreasonable or improvident actions of the plaintiff is generally disregarded
by application of the rules of mitigation of loss. And that loss which is too
remote is disregarded by application of the rules of remoteness of loss.

121 None of these propositions is controversial. It is also uncontroversial that

the onus of proof in relation to (3) lies on the defendant, at least in relation to
mitigation of loss.132 This appeal is ultimately concerned with the requirements for
proof of the measure of consequential loss and the availability of a method based
upon recovery of wasted expenditure in (2).

The position in the United States

122 Considerable submissions were made on this appeal about the legal position
in the United States, particularly due to the importance of the 1949 decision in
L Albert & Son v Armstrong Rubber Co,133 which was a significant feature in the
reasoning of the majority Justices in The Commonwealth v Amann Aviation Pty

132 Arsalan v Rixon (2021) 274 CLR 606 at 624-625 [32]. See also TC Industrial Plant
Pty Ltd v Robert's Queensland Pty Ltd (1963) 180 CLR 130 at 138. As to
remoteness, compare Armstead v Royal & Sun Alliance Insurance Co Ltd [2024] 2
WLR 632 at 650 [62]-[63].

133 (1949) 178 F 2d 182.