Corporate Personality and Damages for Loss Caused to a Third Party Company: Forthwell v Pontegadea (UKSC)
With its recent decision in Forthwell Ltd v Pontegadea UK Ltd [2026] UKSC 33, handed down on September 17, 2026, the Supreme Court of the United Kingdom considered a particularly important issue of contract law: whether a contracting party can claim damages for loss suffered by a third party, and specifically by a company within the same group. The case concerned the historic Rogano restaurant in Glasgow. Forthwell, the tenant of the property, had granted the use of the premises to its wholly-owned subsidiary, Lynnet Leisure, which operated the restaurant. Following severe flood and fire damage, the restaurant was unable to reopen, and Lynnet suffered a significant loss of profits. Forthwell sought to recover these losses from the landlord. The Supreme Court dismissed the claim. It affirmed the general rule that a contracting party may recover damages for its own loss and not, in principle, for loss suffered by a third party. The Court declined to create a new, broader exception that ...