ABSTRACT
This chapter explains what is meant by the term “commercial expectations” and reviews a number of cases to show how equity is treating certain expectations as obligatory. Commercial expectations have also found legal expression in statutory initiatives in the United Kingdom. Expectations have found similar legal expression in the law of privity and compound interest. The underlying drivers for the curial and statutory reforms are undeniably economic: to curb market abuse, and overcome market failure through the enforcement of commercial expectations. The imprecision and discretionary nature of equity is a function of circumstances relating to the dynamic nature of the parties’ expectations. As expectations are initially formed at the point of dialogue actions follow and it is the actions or inactions that the law is most interested in when it comes to granting relief. The expectation for an award of compound interest is therefore one principally founded on the commercial realities of market rates of interest.
