C Czarnikow Ltd v Koufos or The Heron II [1967] is an English contract law case, concerning remoteness of harm. The House of Lords held that the "remoteness" test, as a point of confinement to obligation, is, in contract, more prohibitive than it is in tort.

Facts

Koufos sanctioned a ship (the Heron II) from Czarnikow to convey 3,000 tons of sugar to Basra. It was nine days late. The sugar cost had dropped from £32 10s to £31 2s 9d. Koufos asserted the distinction in the loss of benefit. Czarkinow knew there was a sugar advertise, however not that Koufos planned to offer it straight away.

Judgment

The House of Lords held that the misfortune was not very remote. They expressed that the test for remoteness in contract is smaller than it is in tort. While in tort any harm of a sort which is sensibly predictable can be asserted, Lord Reid decided that, in get, the respondent must should have understood that the misfortune was 'not improbable to come about because of the break of agreement'.

A higher level of likelihood is required for the misfortune to be in the consideration of the gatherings. Ruler Reid objected to Asquith LJ's judgment in Victoria Laundry v Newman in that the expression "predictability" was utilized. He accentuated that he would 'utilize the words 'not improbable' as signifying a level of likelihood significantly not as much as an even shot yet by the by not exceptionally surprising and effortlessly predictable.

He accentuated that the tests in tort and contract were altogether different, on the premise that where there is an agreement the gatherings will have had the chance to allocate their liabilities as of now. Along these lines, the test for remoteness ought to be more liberal than in tort, where weighty misfortunes must be extremely remote to block remuneration.