“Where two parties have made a contract which one of them have broken the damage which the other party ought to receive in respect of such breach of contract should be either such as may fairly and reasonably be considered arising naturally i.e. according to the usual course of things from such breach of contract itself or such as may reasonably be supposed to have been in the contemplation of the parties at the time they made the contract as the probable result of breach of it.” In which case the principal was down so :

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92.

“Where two parties have made a contract which one of them have broken the damage which the other party ought to receive in respect of such breach of contract should be either such as may fairly and reasonably be considered arising naturally i.e. according to the usual course of things from such breach of contract itself or such as may reasonably be supposed to have been in the contemplation of the parties at the time they made the contract as the probable result of breach of it.” In which case the principal was down so :

A: Clegg v. Hands

B: Kapur Chand v. Himayat Ali Khan

C: Frost v. Knight

D: Hadley v.Baxendale

The answer is: D

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Explanation

The correct option is D: Hadley v. Baxendale.

The statement is a quotation from the judgment of the Court of Exchequer in Hadley v. Baxendale, which established the rule for determining consequential damages from a breach of contract. The rule states that a breaching party is liable for all losses that the contracting parties should have foreseen, or that were communicated to and known by both parties at the time of contract formation. The other options are not relevant to this rule, as they deal with different aspects of contract law, such as offer and acceptance, frustration, and specific performance.