There is no specific provision for cancelling a subsequent registration (because of an earlier mistake) in the T&Cs - at least there was not in the version used in 2001. I confess I have not looked at every version of the T&Cs - and it is the version that applied when the registration took place that is relevant.
Likewise if you deny someone of an asset without good cause, compensation is not limited to their out of pocket expenses - it includes the value of the lost asset. This applies to a lost contractual right, a chose in action, which is the very least a .uk domain registration is. Of course you can try to limit it in the contract, but that may or may not be effective.
If anyone thinks they have had a domain cancelled within the last 6 years due to an error by Nominet in relation to a previous registrant, please PM me if you want me to look into obtaining full and proper compensation for you.