Contract 10 - Remedies Flashcards
What remedies are there for breach of contract?
- Compensatory damages ๐ต
- Specific Performance ๐ซต
- Injunction โ
What is the default approach to damages and 2 ways of calculating it?
Put innocent party in position they wouldโve been in had the contract been performed
1. Expectation Interest ๐
2. Reliance Interest ๐
What are the two methods of calculating the damages?
- Expectation used where profit is ascertainable - looks forwards to profit ๐
- Reliance used where profit is uncertain - looks back to costs incurred ๐
What are the different ways of calculating expectation interest ๐
- Cost of Cure: cost of substitute/remedial work required - C must act reasonably ๐ทโโ๏ธ๐
- Diminuition in value: difference in value between performance received & performance promised ๐ ๐๐๏ธ
- Loss of Amenity: where loss is not in economic value, but still has value to them ๐ฉ
What are the cases for calculating the expectation interest:
- Cost of Cure ๐ทโโ๏ธ๐
- Diminution of value ๐ ๐๐๏ธ
- Loss of amenity ๐ฉ
๐ = Defective works
Must act reasonably, knocking down and rebuilding a house is not reasonable for aesthetic issues ๐ ๐ฅ๐
(๐&๐ ๐๏ธ often same result)
๐ฉ
Cost of rectification out it proportion to benefit obtained.
Pool too shallow, ๐๐ญ๐คซ๐ฐ
How is expectation interest calculated?
Expected profit + expenses incurred
What is reliance interest and when used?
๐
Putting C in position they wouldโve been in had contract never been entered into
- used where expectation damages are highly speculative ๐คทโโ๏ธ
- recover preparation expenses ๐ค
- expenses prior to breach ๐ท๐ฅ
What is the reliance interest?
๐
- Used when expectation is highly speculative. ๐คทโโ๏ธ
- Puts back into position would have been. ๐
- only applies to wasted costs ๐๏ธ
What are the wasted cost requirements for reliance interest?
๐
- C wouldโve recouped those expenses had contract been properly performed
๐ฐ๐ - D must prove this wouldnโt be the case
๐คฌ๐ฐ๐
Whatโs the case on reliance interest?
๐
โญ๏ธ
Star pulled out of film at last minute. Claimed for costs of director even though incurred before contract with star. โ
๐ฅ๐๐คฌ๐ฐ ๐
Whatโs the case on wasted costs for reliance interest?
๐๐๏ธ
Landlord wrongly terminated mechanic Tenantโs lease early. T tried to sue for their fixed machinery left in the property. As T couldnโt have taken the machinery under the terms of the lease anyway, there was no loss
๐ทโโ๏ธ๐ญโ๏ธ๐ฉ๐คฌ๐คช๐ญ
What losses have special rules and exceptions?
- Mental Distress๐คช: damages not awarded unless a major object of contract ๐was to provide pleasure, relaxation & peace of mind ๐งโโ๏ธ
. - Loss of Reputation๐๐ญ: damages not awarded unless an ๐งโ๐ณ employment contract contains implied term of trust and confidence such that employer must carry out work in honest way ๐
. - Loss of Chance๐ฒ: recoverable in damages if lost chance is quantifiable in monetary terms & there was a real chance opportunity may have come to fruition (gameshow) ๐ฐ
Can damages be recovered on behalf of another?
No
What is a liquidated damages clause?
Stipulates a certain sum payable on particular breach
๐ฅ๐ต
How are liquidated damages clauses interpreted?
Starting point = upheld
Courts intervene will strike it out where itโs a
- penalty clause โฝ๏ธ,
AND
- C will be entitled to unliquidated damages ๐ต