Law:

Section:

Per Lord Sumption; Lord Neuberger (President), Lord Mance, Lord Clarke and Lord Hodge, JJSC, agreeing.(a) Damages-------'Res inter alios acta' doctrine of---Scope---General rule was that loss which had been avoided was not recoverable as damages, although expense reasonably incurred in avoiding it may be recoverable as costs of mitigation---Exception to such general rule was collateral payments (res inter alios acta), which the law treated as not making good the claimant's loss---Critical factor was not the source of the benefit in a third party but its character---Collateral benefits were those whose receipt arose independently of the circumstances giving rise to the loss, thus a gift received by the claimant, even if occasioned by his loss, was regarded as independent of the loss because its gratuitous character meant that there was no causal relationship between them---Same was true of a benefit received by right from a third party in respect of the loss, but for which the claimant had given a consideration independent of the legal relationship with the defendant from which the loss arose.Bradburn v Great Western Railway Co (1874-5) LR 10 Ex 1 and Parry v Cleaver [1970] AC 1 ref.(b) Negligence-------Professional negligence---'Res inter alios acta' doctrine of---Applicability---'Transferred loss, principle of---Applicability---Unjust enrichment, principle of---Applicability---Negligent advice given by a professional---Damages, quantum of---Claimant-company had lent a sum to the borrower company to buy a medical business---Defendants were accountants who carried out due diligence for claimant-company on the purchase and did so negligently---Subsequently the medical business collapsed and borrower-company defaulted on its loan---To improve claimant-company's balance sheet and for reasons of tax efficiency, owner of claimant-company entered into a re-finance arrangement and provided an interest-free loan to the borrower-company, which it used to discharge the loan to claimant-company, so that instead a loan was now owed to the owner of claimant-company---Issue for the court was whether quantum of damages to be awarded to the owner of claimant-company were to be…