A bit harsh on Cook and on Brum.
I would be inclined to give Brum the benefit of the doubt over negotiations for the premature termination of the loan agreement. My understanding is that, although the compensation sought was steep, Brum was not immovable because sensible businessmen are not intransigent. (The directors have a reputation in HK of being fairly astute.) Brum are not going to significantly improve their position in the table and any improvement, or deterioration, is unlikely to be put down only to the presence or absence of a goalkeeper. If City wanted JH badly enough and some suitable arrangement that suited both clubs would have been arrived at, even though it may have strained goodwill.
As for City's handling of the loan agreement, the relevant PL rules on temporary transfers (Rules 5-10 in section M) are quite clear. A season long loan agreement means just that: a season long loan. It is nonsense to suggest that City can negotiate loan agreements which conflict with this requirement.
With the benefit of hindsight, City could have included a clause which dealt with premature termination of a loan agreement in 'exceptional circumstances'. The rules make it clear that the PL has a discretion to permit a premature termination in order to recall a loan player to provided needed cover. There is no dispute but that the discretion was engaged in this case but the PL decided to use it against City's request. The reason given, to preserve the integrity of the competition, was nonsense in my view as Rules 5-10 equally to all PL clubs. Competing clubs do not have a legitimate expectation that another club will not, through no fault of its own, not invoke the 'exceptional circumstances' clause when misfortune arises.
Be that as it may, I can see no reason why a club loaning a goalkeeper should not, as part of the deal, make provision for the possibility that the 'exceptional circumstances' situation might arise oner day. A suitable clause might deal with the financial consequences upon 'exceptional circumstances' arising, probably a pro rata scale of agreed compensation depending on the time remaining under the agreement when disaster strikes. There is no unfairness in this only prudence because any club can do this.If the other club looking to borrow a player does not like it, it can look elsewhere for a loan.