Jackson v. Royal Bank of Scotland
House of Lords
2005 UKHL 3 (2005)
Jackson (plaintiff), through his business, sold dog chews imported from Thailand to a buyer, Economy Bag (EB), using the Royal Bank of Scotland (defendant) as an intermediary that issued letters of credit. By mistake, the Bank disclosed to EB that Jackson earned a 19 percent markup on each sale; EB then ended the relationship. Jackson sued the Bank for breach of its duty of confidence, seeking damages for the loss of future profits. The trial court awarded damages based on a finding the relationship would likely have continued four more years; the court of appeal cut this to one year, and the Bank appealed to the House of Lords.
Whether a four-year period is too remote a time frame for assessing loss-of-future-profits damages for breach of contract, where the loss arose naturally from the breach or was a reasonably foreseeable consequence of it.