Opinion ID: 2178388
Heading Depth: 2
Heading Rank: 2

Heading: Imputed Foreseeability or Contemplation

Text: Simply stated, the first principle of Hadley is one of imputed foreseeability or contemplation โ that which any reasonable person should have foreseen at the time the contract was forged. The second principle is one of actual foreseeability or contemplation โ what the reasonable person with particular knowledge should have foreseen at the time the contract was forged. Fulfillment of the first principle of the Hadley rule is to be assessed by an objective standard. 5 Corbin, Contracts, ง 1010, pp 78-79. Thus, the extent of recovery is to be measured, not by what the defendant actually foresaw when the contract was formed, but by what a hypothetical reasonable person in the position of the defendant, with the defendant's knowledge of the circumstances surrounding the transaction, could reasonably have been expected to foresee or should have foreseen, had such defendant considered the matter. The second principle of actual foreseeability or contemplation is not a concern of this case.