Originally from the Journal of Damages in International Arbitration

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ABSTRACT

This article proposes that the concepts underlying the English law concept of “loss of a chance” may be helpful to tribunals in the assessment of damages in cases of expropriation, breaches of transnational law or contractual breach where the asset giving rise to the dispute lacks one or more features of a “going concern”.

I.  THE ORIGINS OF THE LAW OF LOSS OF A CHANCE

A mere chance is a valuable thing and English law, for one, explicitly recognizes it as such.  As Lord Hoffman put it, “the law treats the loss of a chance of a favourable outcome as compensatable damage in itself”. 

The law in relation to loss of a chance proper is commonly dated to the English case of Chaplin v Hicks.   Ms Chaplin was an aspiring actress who entered into a beauty contest operated by Mr Hicks, a figure in the theatrical world.  Under the rules of the contest, an early form of “reality” entertainment, the UK was divided into 10 regions, each of which was to select 5 entrants to the contest.  The 50 resulting entrants would then be narrowed down to 12 winners by Mr Hicks and his committee.  The final 12 winners were to receive acting roles for the next three years with the following pay scales: the top four contestants out of the final 12 were to receive £5 per week; the next four would receive £4 per week; and the final four would receive £3 per week.  The remaining 38 finalists would receive nothing.