## Facts

- Barns owned iron mills said to be worth £20 per year and agreed that Nurse could use the mills for six months in exchange for £10.
- In preparation to use the mills, Nurse obtained stock (materials) intended for processing at the mills.
- Before the six-month term ended, Barns stopped allowing Nurse access to the mills and failed to perform the agreement.
- As a result of being unable to use the mills as promised, Nurse alleged that the stock acquired for that purpose lost value and produced a substantial loss.
- A jury awarded Nurse £500 in damages, reflecting both the value of the bargain and loss associated with the stock laid in for performance.
- Barns sought review in the Court of King’s Bench, arguing that such a large award was not legally permissible in a contract action where the agreed price was only £10.

## Issues

1. Whether, in an action for breach of contract, the factfinder may award special (consequential) damages for loss on stock obtained in connection with performance.
2. Whether recoverable contract damages are capped at the contract price or consideration, such that damages exceeding £10 are impermissible.
3. What connection to the contract is required for losses on preparatory expenditures (such as stock laid in) to be treated as damages “arising from” the breach rather than unrelated business losses.

## Decision

- The King’s Bench affirmed the jury’s £500 award.
- The court accepted that damages were not limited to the stated consideration and could include additional losses attributable to the breach.
- The award was upheld on the ground that the stock-related loss was treated as a recoverable consequence of being deprived of the promised use of the mills.

## Legal Principles

- Contract damages may include special (consequential) losses caused by the breach when those losses are connected to the performance the contract contemplated.
- Recoverable damages are not automatically limited to the contract price or consideration; they may exceed that amount if the plaintiff proves additional loss caused by the breach.
- Preparatory investments made for performance (such as stock acquired for use with promised equipment or facilities) may be compensable when their loss in value results from the defendant’s nonperformance and is tied to the transaction.
- Factfinders may assess damages beyond the face value of the bargain where doing so compensates for loss attributable to the breach, including losses incidental to performance preparations.

## Conclusion

The court upheld a substantial damages award that exceeded the contract price because the breach deprived the plaintiff of the contracted-for use of the mills and caused connected losses on stock obtained for performance, confirming that contract remedies may include special damages not capped by the stated consideration.


Nurse v. Barns, (1664) 83 Eng. Rep. 43 (K.B.)