Rowan Turrall evaluates why the Court of Appeal found “loss of profits” exclusion did not exclude liability for wasted expenditure

In the opening paragraph of his judgment in Soteria Insurance Ltd (‘CIS’) v IBM United Kingdom Ltd (‘IBM’) [2022], Coulson LJ remarked that at least £80m turned on the construction of one clause. The Court of Appeal had to decide whether that clause excluded IBM’s liability for wasted expenditure.


CIS entered a contract with IBM to implement a new IT system. The project did not go to plan. IBM purported to terminate the contract following CIS’ failure to pay an invoice. CIS argued that termination was wrongful and treated it as a repudiatory breach of contract. CIS sought damages for wrongful termination – including some £132m in respect ...

Rowan Turrell
Partner and Head of the Dispute Resolution Team
Boyes Turner

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