Hatton National Bank v. Tilakaratne – sllr 2001 volume 3 page 295

In Tilakaratne v. Hatton National Bank, the court addressed whether a bank’s wrongful dishonour of a cheque constitutes a breach of contractual duty of care and the appropriate assessment of damages for injury to customer reputation and creditworthiness. It was determined that wrongful dishonour by a bank amounts to a breach of the contract with the customer, but substantial damages may not be awarded absent concrete proof of special loss or business reputation impairment. The findings relied on principles distinguishing the status of trader and non-trader customers, referencing legal standards that require clear evidence for recovery of substantial damages. The outcome clarified the application of nominal versus substantial damages for wrongful dishonour, emphasizing that only proven loss