header-logo header-logo

Home Login E-newsletter About us
04 July 2019 / Richard Samuel
Issue: 7847 / Categories: Features , Procedure & practice , Damages
printer mail-detail

Reflective loss reconsidered (Pt 1)

© Copyright LexisNexis 2026. All Rights Reserved.

In a special two-part NLJ series, Richard Samuel considers the history & likely future of the court’s rulings on shareholder action & reflective loss
  • The Supreme Court is due to review the rule on reflective loss this year in Sevilleja Garcia v Marex Financial Ltd.
  • The orthodox view is that the rule as currently formulated in the House of Lords’ decision Johnson v Gore Wood is an inflexible rule of law..
  • Richard Samuel offers a heterodox view of Johnson as affirming the rule as one of procedure, which should be applied flexibly.

In Prudential Assurance Co Ltd v Newman Industries Ltd (No 2) [1982] Ch 204, [1982] 1 All ER 354 at pp222H–223B, the Court of Appeal first established the rule on reflective loss as a means of imposing structure on out-of-control first instance litigation brought by a company’s shareholders as a combination of derivative action and direct action: ‘In our judgment the personal claim is misconceived … what [the shareholder] cannot do is to recover damages merely because

If you are not a subscriber, subscribe now to read this content
If you are already a subscriber sign in
...or Register for two weeks' free access to subscriber content

MOVERS & SHAKERS

Read All
Foot Anstey—Jasmine Olomolaiye

Foot Anstey—Jasmine Olomolaiye

Investigations and corporate crime expert joins as partner

Fieldfisher—Mark Shaw

Fieldfisher—Mark Shaw

Veteran funds specialist joins investment funds team

Taylor Wessing—Stephen Whitfield

Taylor Wessing—Stephen Whitfield

Firm enhances competition practice with London partner hire

NEWS
Read All
NLJ this week: Surrogacy children caught in succession gap
A High Court ruling involving the Longleat estate has exposed the fault line between modern family building and historic trust drafting. Writing in NLJ this week, Charlotte Coyle, director and family law expert at Freeths, examines Cator v Thynn [2026] EWHC 209 (Ch), where trustees sought approval to modernise trusts that retain pre-1970 definitions of ‘child’, ‘grandchild’ and ‘issue’
NLJ this week: Online safety law at a crossroads
Fresh proposals to criminalise ‘nudification’ apps, prioritise cyberflashing and non-consensual intimate images, and even ban under-16s from social media have reignited debate over whether the Online Safety Act 2023 (OSA 2023) is fit for purpose. Writing in NLJ this week, Alexander Brown, head of technology, media and telecommunications, and Alexandra Webster, managing associate, Simmons & Simmons, caution against reactive law-making that could undermine the Act’s ‘risk-based and outcomes-focused’ design
NLJ this week: Do Mandelson and Mountbatten-Windsor meet the misconduct bar?
Recent allegations surrounding Peter Mandelson and Andrew Mountbatten-Windsor have reignited scrutiny of the ancient common law offence of misconduct in public office. Writing in NLJ this week, Simon Parsons, teaching fellow at Bath Spa University, asks whether their conduct could clear a notoriously high legal hurdle
NLJ this week: Supreme Court unlocks ‘lost years’ windfall for injured children
A landmark ruling has reshaped child clinical negligence claims. Writing in NLJ this week, Jodi Newton, head of birth and paediatric negligence at Osbornes Law, explains how the Supreme Court in CCC v Sheffield Teaching Hospitals NHS Foundation Trust [2026] UKSC 5 has overturned Croke v Wiseman, ending the long-standing bar on children recovering ‘lost years’ earnings
NLJ this week: Finality trumps freedom in arbitration showdown
A Court of Appeal ruling has drawn a firm line under party autonomy in arbitration. Writing in NLJ this week, Masood Ahmed, associate professor at the University of Leicester, analyses Gluck v Endzweig [2026] EWCA Civ 145, where a clause allowing arbitrators to amend an award ‘at any time’ was held incompatible with the Arbitration Act 1996
Copyright © 2026 LexisNexis
back-to-top-scroll