Kpohraror v Woolwich Building Society
| Jurisdiction | England & Wales |
| Judge | Evans,Waite L JJ,Sir John May |
| Judgment Date | 30 November 1995 |
| Court | Court of Appeal (Civil Division) |
| Date | 30 November 1995 |
Court of Appeal
Before Lord Justice Evans, Lord Justice Waite and Sir John May
Banking - wrongfully dishonoured cheque - general damages
A person who was not a trader could recover substantial rather than nominal damages in contract for loss of business reputation resulting from a cheque being wrongly dishonoured by his bank.
The Court of Appeal so stated when dismissing an appeal by the plaintiff, Udele Edirin Kpoharor, and a cross appeal by the defendant, Woolwich Building Society, against a decision of Master Tennant to award £5,500 general damages to the plaintiff for injury to his credit by reason of the defendant wrongly dishonouring his cheque for £4,500 and the apparently discreditable reason they gave for so doing.
Mrs Daphne Loebl for the plaintiff; Ms Katherine McQuail for the defendant.
LORD JUSTICE EVANS said that both parties accepted that the claim was governed by the general law so that the plaintiff might recover general damages under the first part of the rule in Hadley v BaxendaleENR ((1854) 9 Exch 341) and special damages under the second part when the necessary facts were proved.
The claim for general damages rested upon the first part, namely they were claimed as damages "arising naturally (which meant in the normal course of things) from the defendant's breach" per Lord Wright in Monarch Steamship Co v A/B Karlshamns OljefabrikerELR ((1949) AC 196, 221).
It was not disputed that a claim did arise for loss of credit or business reputation but the defendants said that the amount should be nominal unless special facts were proved which were made know to them when the contract was made; in other words that this should properly be regarded under the second not the first part of the Hadley v Baxendale rule.
However, the plaintiff relied upon the line of authority which held that actual damages need not be alleged or proved by a trader, which he claimed that he was. The defendants said that they were unaware of that and that the rule did not apply for that reason alone.
The issue was whether a person who was not a trader for the purposes of the common law rule, and it was not at all clear what the limits of that category were, could recover substantial rather than nominal damages for loss of business reputation when his cheque was wrongly dishonoured by the bank.
It was abundantly clear that history had changed the social factors which...
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