In British Transport Commission v Gourley 1956 the HOL held that damages

In british transport commission v gourley 1956 the

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In British Transport Commission v Gourley (1956) , the HOL held that damages awarded by the court will be deducted for tax payable if the defendant can show that the plaintiff would have been taxable. Thus, if the plaintiff suffered a loss of profit of RM 5,000, this amount is not deducted for tax unless the defendant can show that it is taxable. This principle has been applied in the Malaysian cases of Daishowa (M) Wood Products Sdn Bhd v Kepong Products Co Sdn Bhd (FC) (1980) and also in Associated Pan Malaysia Cement Bhd v Syarikat Teknical etc Bhd (1990) . In Associated Pan Malaysia Cement Bhd , the court confirmed the principle that tax will be deducted from damages if the plaintiff is taxable. OTF, the defendant failed to show that the plaintiff was taxable and hence the tax was not deducted from the damages awarded. Contributory Negligence In English law where the plaintiff has negligently contributed to the losses suffered in breach of the contract, it is unclear whether his damages will be reduced. This is because contributory negligence is a principle only recognised in tort but not in contract law. However, there may be one exception as in the case of Forsikringsaktieselskapet Vesta v Butcher (1988) , where it was held that contributory could be raised “where the defendant’s liability in contract is the same as his liability in tort of negligence independently of the existence of any contract”. For example, if the plaintiff suffered a loss is partly caused by the defendant’s advice and partly by the defendant’s own carelessness, then the defendant can raise contributory negligence whether the plaintiff sues under breach of contract or under tort. In Lambert v Lewis (1982) , the court held that where the plaintiff acts by relying on the advertisement of the manufacturer fully accepts liability in its advertisement, as in Carlil v Carbonic Smoke Ball Co (1983) , then the plaintiffs can recover the losses suffered. Prospective damages payable to 3rd parties B (Def) Sue
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In the case of prospective claims from the 3rd party, the plaintiff should try to get a declaratory order to be indemnified from the defendant in case the plaintiff is found to be liable to a third party. In Household Machines Ltd v Cosmos Exporters Ltd [1947] , where the defendant knew that the plaintiff was going to sell the goods to a 3rd party. The court granted a declaratory order that the defendant would be liable in the future to pay the plaintiff reasonable compensation when the plaintiff may become liable to the 3rd party. The 1st and 2nd limbs of the test in Hadley v Baxendale were satisfied. In Trans Trust S.P.R.L v Danubian Trading Co Ltd [1952] , the defendant contracted to buy steel form the plaintiff and to open a letter of credit in the plaintiff’s account. The defendant did not give a letter of credit. The plaintiff could not get supplies from a third party as there was no letter of credit. The plaintiff sued the defendants and one of the losses claimed was prospective damages which the 3rd party can claim from the plaintiff. The court held that the defendant did not know that
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