Legal Case Summary
Victoria Laundry v Newman Industries Ltd [1949] 2 KB 528
Delayed delivery of boiler to laundry company; whether lost profits recoverable
Facts
Victoria Laundry Ltd (VLL) ordered a large boiler from Newman Industries Ltd (NIL) in contemplation of some lucrative dyeing contracts. NIL were aware of the nature of VLL’s business, and that it was intended for the boiler to be put to use as soon as possible. The delivery of the boiler was delayed by five months and VLL claimed for breach of contract.
Issues
VLL claimed damages for their lost profits caused by the delay. They argued losses which would reasonably foreseeably flow from the breach would be recoverable and, therefore, since NIL knew the boiler was required as soon as possible for business purposes, they must have contemplated the use for which the boiler was to be put. VLL claimed it was not necessary to prove actual knowledge of the precise loss. NIL argued they had no special knowledge of running a laundry business or that the boiler was necessary for immediate profit making and, therefore, they were not liable for lost profits. NIL claimed that lost profits amounted to special circumstances which must have been explicitly brought to their attention prior to the breach if they were to be held liable. They could not be assumed to have known the delay would cause lost profits.
Decision/Outcome
VLL successfully recovered the lost profits. NIL knew the boiler was required for VLL’s business and had promised delivery by a specific date. They could not reasonably argue they could not foresee that lost profits would result from the delay. It was unnecessary to prove NIL had specific knowledge of the specific contracts which had been lost. Damages would be awarded for losses which could reasonably have been expected to be lost.
Updated 20 March 2026
This summary of Victoria Laundry (Windsor) Ltd v Newman Industries Ltd [1949] 2 KB 528 remains broadly accurate as a statement of the case and its outcome. The Court of Appeal’s formulation of the remoteness test — that damages are recoverable for losses which a reasonable person in the defendant’s position ought reasonably to have contemplated as a serious possibility — continues to be good law.
However, readers should be aware that the precise language used in this article (particularly the phrase ‘reasonably foreseeably flow from the breach’) elides an important subsequent refinement. In Czarnikow Ltd v Koufos (The Heron II) [1969] 1 AC 350, the House of Lords clarified that the test for remoteness in contract is stricter than in tort: it is not mere reasonable foreseeability, but whether the loss was within the reasonable contemplation of the parties as a not unlikely result of the breach. The article’s framing may slightly overstate the breadth of recovery available in contract if read in isolation. More recently, the Supreme Court in One Step Support Ltd v Morris-Garner [2018] UKSC 20 and Pakistan International Airline Corporation v Times Travel (UK) Ltd [2021] UKSC 40 have not disturbed the foundational principles from Victoria Laundry, which remains a core authority on remoteness of damage in contract. Students should read this case alongside The Heron II to understand the full and accurate statement of the law.
