Mal Owen Consulting Pty Ltd v Ashcroft

The appeal concerned a dispute between Mal Owen Consulting Pty Ltd (the appellant) and Ashcroft (the respondent), a solicitor. The appellant alleged that the respondent breached his retainer by failing to pursue proceedings against a third party, which resulted in the appellant losing a commercial opportunity to recover funds. Although the appellant was later successful in its claim against the third party, the third party's bankruptcy meant no recovery was possible. The matter came before the Court of Appeal of New South Wales.

The primary legal issues before the Court of Appeal were whether the respondent's alleged breach of contract caused the appellant to lose a valuable commercial opportunity, and if so, whether the appellant was entitled to damages for that loss. The court also considered whether the elements of the cause of action for breach of contract were modified by sections 5D and 5E of the *Civil Liability Act 2002* (NSW), particularly in relation to the concept of "harm" as defined in section 5 of that Act.

The Court of Appeal reasoned that the respondent's failure to pursue the third party constituted a breach of contract. Crucially, the court found that the appellant had established that the lost opportunity to recover from the third party was a valuable one, and that the respondent's breach had caused this loss. The court applied principles of causation in contract law, considering the loss of a commercial opportunity as a compensable head of damage. The court determined that the provisions of the *Civil Liability Act 2002* (NSW) did not preclude the appellant from recovering damages for this loss.

The Court of Appeal allowed the appeal, setting aside the orders of the District Court. The court ordered that the respondent pay the appellant $100,000 and the appellant's costs of both the District Court proceedings and the appeal.