CARLY SACE -V- TNT (UK) LTD [2011] EWCA Civ 1583

On the 19th December 2011, Lord Justice Moore-Bick handed down Judgment in Carly Sace v TNT (UK) Ltd, holding that:
(i) the ratio of Copley v. Lawn is that a claimant does not act unreasonably for the purposes of mitigation in rejecting an offer from the defendant unless he is aware that by doing so he will increase the ultimate burden on the defendant, regardless of the effect on his own position;
(ii) in accordance with the doctrine of precedent, the lower courts are required to accept and apply the ratio in Copley v. Lawn, even though they may disagree with it;
(iii) the portion of Longmore L.J.'s judgment in Copley v. Lawn which dealt with the consequences of a failure to act reasonably in order to avoid loss (namely that the claimant can recover "at least the cost which the defendant can show he [i.e. the defendant] would reasonably have incurred") was did not form part of the ratio of the case, but in determining the consequences of a failure to act reasonably, the higher court had decided a question of principle for the purposes of clarifying the law for the profession at large; as such the lower court should have followed and applied the principle despite it being obiter.
 

The reader may wish to note Moore-Bick L.J.'s remarks at paragraph 29 where he confesses to having difficulty with the conclusion that a claimant who has unreasonably refused an offer from the defendant of a free courtesy car can recover at least the cost which the defendant can show he would reasonably have incurred, having regard to the principle of avoidable loss. Tantalisingly (at paragraph 30), Moore-Bick L.J. remarks that "it would be beneficial for these questions to be considered at the highest level as soon as a suitable opportunity arises".  Whether the Supreme Court chooses to accept Lord Justice Moore-Bick's invitation will remain to be seen...