MFM RESTAURANTS PTE LTD V FISH & CO RESTAURANTS PTE LTD

[2010] SGCA 36, Singapore Court of Appeal, Chao Hick Tin JA, Andrew Phang Boon Leong JA and VK Rajah JA, 18 October 2010

Contract - Damages - Remoteness - Assumption of responsibility - Hadley v Baxendale - The Achilleas

Fish & Co and MFM were both chains of seafood restaurants in Singapore. Mr DL had left the employ of the claimant and respondent, Fish & Co, in order to set up the defendant and appellant, MFM. A Settlement Deed had been agreed whereby DL undertook not to use certain pans, slogans, phrases and sauces in any new venture within a specified time. MFM from the outset used those pans, slogans, phrases and sauces. Fish & Co enforced the Settlement Deed and sought compensation for losses it said it had suffered as a result of the breaches. Throughout negotiations, MFM disputed all claims, only to admit liability on the first day of trial. The claim for damages was divided into a claim for the period of breach itself and a claim for a period thereafter when the revenues of the affected outlets were still affected by the breach (the post-breach period). The Court of Appeal allowed the appeal in part. The breach period damages were a relatively simple matter of deciding on the method of calculation. As for the post-breach period claim, the issue was whether such damages were too remote. In this respect, the Court of Appeal decided that Singapore would not follow The Achilleas [2008] 2 Lloyd's Rep 275 in introducing a concept of assumption of responsibility but would keep to the approach in Hadley v Baxendale (1854) 9 Exch 341 as confirmed in Singapore by Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd [2008] 2 SLR(R) 623. The concept of assumption of responsibility advocated by Lord Hoffman in The Achilleas was not part of the law of Singapore, except to the extent already embodied in the approach embodied in Hadley v Baxendale itself.