British Westinghouse Electric and Manufacturing Co Ltd v Underground Electric Railways Co of London Ltd [1912] AC 673
Contract; remedies for breach; damages; mitigation of loss.
Facts: British Westinghouse (BW) contracted to supply electric turbines to Underground Electric Railways (UER). The turbines supplied were defective. UER replaced them with turbines that were more powerful and efficient (and more expensive) than the original ones. UER sued BW for damages to compensate for the additional cost of the replacement turbines. However the bigger turbines had reduced UER's costs and increased its profits.
Issue: In the circumstances, was UER entitled to the damages claimed?
Decision: Damages could not be claimed.
Reason: Taking account of the savings and increased profits, it was apparent that UER had not suffered an overall loss in relation to the increased cost of the new turbines.
Note: Damages were allowed for losses UER had suffered while using the defective turbines.