Edelman J

Steward J
Gleeson J
Beech-Jones J

56.

proving loss of profit"213 due to the defendant's breach should require the defendant
to bear an onus to establish that wasted expenditure would not have been
recovered.214 And in Yam Seng Pte Ltd v International Trade Corporation Ltd,215
Leggatt J reiterated these points and added, in an eloquent summary of what we
have described as the facilitation principle, that in instances of wasted expenditure
by a plaintiff:216

"[T]he attempt to estimate what benefit the claimant has lost as a result of
the defendant's breach of contract or other wrong can sometimes involve
considerable uncertainty ... The court is aided in this task by what may be
called the principle of reasonable assumptions – namely, that it is fair to
resolve uncertainties about what would have happened but for the
defendant's wrongdoing by making reasonable assumptions which err if
anything on the side of generosity to the claimant where it is the defendant's
wrongdoing which has created those uncertainties."

153 These principles from these two decisions were referred to with approval
by the Court of Appeal of England and Wales in Soteria Insurance Ltd v IBM
United Kingdom Ltd.217 That case concerned the interpretation of an exclusion
clause and consideration of whether a claim for loss based on wasted expenditure
was a claim for "consequential losses" (and thus irrecoverable under the exclusion
clause), which was defined as a separate exclusion from "loss of profit", or whether
the claim was for "direct loss" (and thus recoverable), which was defined to include
"the reasonable, incremental costs of procuring substantially similar replacement
or alternative[] services or systems".218 One issue was whether financing costs and
payments to third party suppliers fell within recoverable "direct loss[es]" rather
than irrecoverable "consequential losses" within the meaning of the exclusion
clause.

213 [2011] 1 Lloyd's Rep 47 at 52-53 [33], citing Hutchison J in CCC Films (London)
Ltd v Impact Quadrant Films Ltd [1985] QB 16 at 40.

214 [2011] 1 Lloyd's Rep 47 at 55-56 [46]-[47], [49].

215 [2013] 1 Lloyd's Rep 526.

216 [2013] 1 Lloyd's Rep 526 at 553 [188].

217 [2022] 2 All ER (Comm) 1082 at 1095 [42], 1096 [45].

218 [2022] 2 All ER (Comm) 1082 at 1090 [24], 1091 [26].