The case of General Motors UK Ltd v The Manchester Ship Canal Company Ltd concerned a licence agreement which allowed General Motors to discharge surface water into the canal for a modest annual fee of £50.
A Holiday Time Story
We all look forward to the summer holidays – time to relax with the family, sunbathe, go mountain biking, switch off from the day-to-day tasks and worries. But what happens when your holiday dream turns into a holiday nightmare? Although it is very difficult to put a price on disappointment the Court of Appeal has clarified the approach in deciding the level of damages to award in the recent case of Milner and another v Carnival plc (t/a Cunard)  EWCA Civ 389.
In this case, Mr and Mrs Milner had booked the holiday of a lifetime - a 15 week cruise costing £59,052.20 – and had spent £4,300.00 on gowns for Mrs Milner to wear to the many formal dinners. However, not long after sailing from Southampton they hit rough weather, and the floor of the superior cabin they had booked began to buckle and vibrate with the movement of the ship.
The noise was so bad that the Milners could not even sleep with earplugs. They were offered an alternative inferior cabin, where they slept for some time before being upgraded. However, the uncertainty of how long they would be able to stay in the cabin caused them further stress and they eventually had to return to their original cabin. By the time they reached Hawaii they could take it no longer and disembarked. After recovering from the stress for several weeks they booked an alternative passage home.
The Milners were given a partial refund of £48,270 but still pursued claims for diminution in value of the holiday, distress and disappointment, wasted expenditure on dresses and the cost of their return travel from Hawaii to Southampton. The trial judge was sympathetic to their claims and awarded £2,500 each for the diminution in the value of their cruise and £7,500 each for the distress and disappointment of the cruise not matching their expectations. Mrs Milner was also awarded £2,000 for her wasted expenditure on formal gowns.
The Defendant appealed and it fell to the Court of Appeal to give authoritative guidance on the correct measure of damages for a ruined holiday. Lord Justice Ward clearly set out the different heads of damages which the Courts will consider in these types of cases, which are as follows:
1) Compensation for the diminution in value i.e. the monetary difference between what was bought and what was supplied;
2) Compensation for consequential pecuniary loss to include out of pocket expenses i.e. the cost of alternative accommodation or travel etc
3) Compensation for physical inconvenience and discomfort; and
4) Compensation for mental distress.
Lord Justice Ward recognised that in assessing damages it is necessary to “compare the expectations against the reality” but considered the damages awarded by the trial judge “excessive and disproportionate”. He awarded the Milners the total sum of £12,000, made up of £4,000 to Mr Milner and £4,500 to Mrs Milner for inconvenience and distress, and £3,500 for diminution in value.
As Lord Justice Ward put it drily: the Milners had certainly received the experience of a lifetime but “not in the way they had bargained for.”