Jackson v Royal Bank of Scotland  [2005] 1 WLR 377  House of Lords

The claimants carried on business of importing goods and selling them on for resale. His main customer was a business called Economy Bag. Both businesses banked at the Royal Bank of Scotland (RBS), the defendant. RBS mistaken revealed some invoices to Economy Bag which showed the mark-up that they were receiving for the services they provided. This revelation was in breach of confidence and amounted to a breach of contract. Economy Bag were outraged at the amount the claimants were receiving and they were also concerned that the claimants had taken steps to hide that amount. Consequently, Economy Bag ceased to trade with the claimants. Consequently the claimants were deprived of their main source of income and were forced to cease trading. The claimants brought an action against RBS to recover their loss. The trial judge found for the claimants and ordered RBS to pay damages based on their loss of profit from trading with Economy Bag over a four year period. The Court of Appeal reduced this to one year. The claimant’s appealed the reduction and RBS cross appealed contending that the loss of
profit was too remote.

Held:

The loss of profit was not too remote. The Court of Appeal had erred in its application of Hadley v Baxendale to reduce the loss of profit to one year. The trial judge’s findings as to assessment of damages restored.

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