ExpertACCA · Question 48 · Syllabus B: The law of obligations
Scenario: QuantumLeap AI Ltd, a tech startup, advertised a new software tool on their website for £50 (a pricing error, should be £500). Zephyr Corp ordered 10 copies. QuantumLeap realized the error and refused to supply. Later, QuantumLeap contracted with DataForge to build a server by 1 May. DataForge finished on 1 June, causing QuantumLeap to lose a lucrative government contract they hadn't told DataForge about.
Can QuantumLeap recover the lost profits from the government contract from DataForge due to the late delivery?
Scenario: QuantumLeap AI Ltd, a tech startup, advertised a new software tool on their website for £50 (a pricing error, should be £500). Zephyr Corp ordered 10 copies. QuantumLeap realized the error and refused to supply. Later, QuantumLeap contracted with DataForge to build a server by 1 May. DataForge finished on 1 June, causing QuantumLeap to lose a lucrative government contract they hadn't told DataForge about.
Can QuantumLeap recover the lost profits from the government contract from DataForge due to the late delivery?
Answer options:
Yes, because the loss was a direct result of the breach of contract.
Yes, under the first limb of Hadley v Baxendale as a natural consequence of the breach.
No, because the loss is too remote under the second limb of Hadley v Baxendale, as DataForge was not informed of the special circumstances.
No, because damages for breach of contract cannot include lost profits.
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