Plaintiff may seek reliance losses where they exceed expectation losses.
Legal position: the plaintiff does not have to prove that there were other opportunities that they lost.
McRae v Commonwealth Disposals Commission [1951] Australia High Court Facts: McRae [Plaintiff] won a tender to try salvage an oil tanker (stranded on a reef near New Guinea during the Second World War) from the Defendant [Commonwealth]. In actuality, it turned out that there was no oil tanker and that the Defendant was relying on gossip. McRae nevertheless sued to recover his losses.
Issue: The issue here was how to award damages to the Plaintiff. It is impossible to give the usual expectation benefits, because it was impossible to assess the expected benefit from a non-existing stranded oil tanker. This is because the Defendant did not contract to deliver a tanker of any particular size or condition etc.
Holding/Reasons: However, the “mere difficulty in estimating damages did not relieve a tribunal of fact from the responsibility of assessing them as best it could.” Instead, we measure damages in reliance. This includes all expenditure that the Plaintiff incurred in reliance on the Defendant's promise. The Plaintiff was awarded reliance damages to compensate him for all his expenditure.
Rule / takeaway: The plaintiff does not have to prove / provide evidence that there were other opportunities that they missed out on relying on the contract. Lost opportunity is a head of compensation the courts will recognize!
