7. Contractual Remedies I Flashcards
Robinson v Harmen
Aim of damages is to put parties in the position they would be in if contract had been performed
(makes sense - function of contract = security of knowing parties will perform)
Photo Productions v Securicor
Lord Diplock - breach of primary obligation gives rise to secondary obligation for breacher to pay monetary compensation for loss bc of breach
William v Agius
s. 51 non-delivery
- s.51(3) prevails because SOGA follows common law
- general principle is B gets difference between MV of goods at time of delivery and the contract price)
Rodacanachi v Milburn
carriage of goods case
- S failed to deliver cotton
- damages: difference between MV of goods at time of delivery and contract price
Clark v Macourt
HIGH COURT OF AUSTRALIA
- Doesn’t matter that D didn’t suffer any loss (patients paid for sperm)
CLAIM IS TO VALUE OF GOODS
Hayne J: take a broader definition of loss (not just out of pocket loss)
- loss includes failure to obtain something you were entitled to
Jamal v Dawood
s.50 non-acceptance
- damages: loss ascertained at date of breach
- if S held onto shares after it is at S’s risk (doesn’t increase or decrease damages)
R&H Hall v Pim Junior
for consequential loss, sub sale can be taken into account if remoteness test is met
The Mediana
lightship damaged but C had another
D must pay for loss of use of ship (doesn’t matter that C had a replacement ship)
once D damages, C is entitled to VINDICATE right (C is deprived of an opportunity to use and law puts value on this)
particular losses only relevant for “special damage” (consequential loss)
Slater v Hoyl
s.53 breach of warranty
B entitled to difference between MV of goods and contract goods actually delivered
doesn’t matter that B used anyway to fulfil order and SB paid in full
Supports S/T view and Jamal and Agius
Bence Graphics v Fasson
breach of warranty (vinyl not good)
- SB complained and S compensated for that
- any further liability?
NO FURTHER LIABILITY
- DAMAGES CAN BE REDUCED BC LOSS SUFFERED IS LIMITED
OTTON LJ: distinguish Slater
- Slater: reselling same goods (here B changed) and S didn’t know what goods used for (here S knew)
- goods converted = Slater doesn’t apply
AULD LJ: reconsider Slater
- aversion to idea that commercial party can recover more than actual loss
- challenge Slater (windfall)
The Golden Victory
D repudiated contract in 2001 (returned ship early)
C claims damages for remaining period (4yrs) but in 2003 Gulf War broke out and that term would allow D to repudiate
HELD: NO damages for loss post-2003 (artificial to disregard events that actually occurred)
NOT inconsistent with s/t because benefit = on-going contract and that needs to be valued (valuation includes term)
Melachrino v Nikoll
S repudiates (anticipatory breach) and B accepts
S liable but NOMINAL DAMAGES
- B suffered no loss
- Damages determined by MV @ contract date (this was the right)
British Westinghouse
Benefits acquired by B in acquiring new turbines must be taken into account
- B did not suffer loss by replacing goods
- S already paid for differences in value
Blue Circle v MOD
Value assessed by reference to earliest time at which it could be sold by B (£4mn)
NOT the difference between what it is worth now and what is was worth (D cannot reasonable expect C to hold onto land)
Hadley Baxendale
consequential loss:
1) arising naturally in ordinary course of events
2) reasonably supposed to be in contemplation of parties at time of contract
Victoria Laundry v Newman
D did not know of lucrative contract so C cannot recover damages for that
NOT LIMB 1
NOT LIMB 2 (D didn’t know)
damages capped at reasonably foreseeable loss
The Heron II
Limb 1 Hadley v Baxendale
- ordinary course of events = “not unlikely” (2% not fine, 25% probably fine)
Weld Blundell v Stephens
D’s liability arises if there is some knowledge and acceptance of purpose/intention of entering contract
Horne v Midland
for notice to have effect, must be “an actual contract” (Blackburn J)
- highest test stated
- doubted in The Heron (no need for contractual agreement)
The Pegase
for limb 2 - not just knowledge, but no need for contract either….
MIDDLE GROUND: ASSUMPTION OF RESPONSIBILITY
- knowledge and reasonable person would contemplate that on breach, they would be liable for this (middle ground)
The Achillias
Court said that damages were not unlikely (ordinary course of events - limb 1)
BUT too remote
because commercial practice that these losses are not recoverable
- seems to be adding AOR into limb 1?
John Grimes v Gubbins
ordinary foreseeability test from Hadley is the “Standard rule” but will be departed from when “commercial background” is such that the standard approach does not reflect expectations
Habton v Nimmo
s.49 = difference to remedy for “damages”
S ONLY has to show price is due (no need to show loss)
Stein, Forbes, v County
B breaches (doesn’t take delivery) and S sues for price
NO S.49 because property had not passed (and not a case where price due irrespective of delivery either)
Shell-Mex v Elton Cop
ROT clause
- property not passed so no action for price
- s.49 only if price earned
PST Energy
s. 49 is irrespective of delivery
- can be earned without delivery
Oil Bunkers
- not SOG case
- but if it was, can there be action for price outside s.49?
- NO S.49 is exhaustive
Castle v Platford
allowed action for price where property had not passed
risk passed to B (and goods destroyed without fault of S)
White & Carter v McGregor
C earned price and brought action for price (kept contract alive - did not accept repudiation)
- unusual: only works if C can complete their side of the contract without co-operation
- if D can show C has no legitimate interest in performance, D can resist
Re Wait
court unlikely to order SP for unascertained goods because damages likely adequate
Sky Petroleum v VIP
Exceptionally, if damages inadequate maybe SP
- D was only source of supply and C needs supply to continue business
- damages inadequate
Co-Op v Argyll
SP involves court forcing a party to perform os court reluctant to order
C cannot argue he has a right to performance and so must be SP
- compare C’s loss to D’s burden
- if burden on D is higher, no SP
AG v Blake
general position = no gain based remedy
here yes but exceptional case (spy and gov)
FHR v Cedar
RECIEPT of bribe/secret commission by AGENT is held by A on CT for P
GAIN BASED PROPRIETARY REMEDY = VERY UNUSUAL
