Yaadrimee kasaaraa al-kallattii fi raawwii isaa: sirna seeraa itoophiyaa keessatti

Abstract

In civil actions, whether contractual or extra contractual, a person who suffered injury as a result of the unlawful conduct of another will be entitled to compensatory damages. Different jurisdictions categorize recoverable damages as direct and indirect (consequential) losses. In contractual relation, consequential losses may be taken to mean losses which may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract as the possible result of the breach of it. Consequential pecuniary losses recoverable in tort concern analogous situations with those regarding breach of contract. Such consequential losses may include, inter alia, wasted expenditure and loss of profits caused by conduct of wrong doer. In Ethiopia, although the term “consequential loss” is not specifically stated in legislations, insurance policies frequently exclude the recoverability of consequential losses; the Federal Supreme Court Cassation Bench has also decided in some cases how and when consequential loss is recoverable. This article critically examines how the concept of consequential loss is included in Ethiopian laws and canvasses the recoverability of such losses in different causes of actions (contract, Tort, Insurance) with their tests. It explores the practice of some foreign jurisdictions in assessment of compensation for consequential losses in different cause of actions and evaluates with our current legal framework and practice.