Contract - Remedies

Question 1

When are common law remedies available?

Answer 1

As of if a contract is breached

Question 2

Expectation interest

Answer 2

Aims to put the claimant in the same position as if the contract had been performed

Question 3

Addis v Gramophone Co

Answer 3

Damages for non-pecuniary loss (e.g. mental distress) are generally not recoverable in a contract

Question 4

Jarvis v Swan Tours; Farely v Skinner

Answer 4

Injury to mental distress as well as loss of amenity can be compensated when the whole purpose of the contract is pleasure, relaxation and peace of mind; where pleasure is still an important factor

Question 5

What questions should be asked when awarding damages?

Answer 5

1. Is the damage too remote?
2. How can the damage be quantified?

Question 6

Hadley v Baxendale

Answer 6

Objective test: The non-breaching party can recover general damages which arise naturally; direct consequences of the breach; often presumed to be foreseeable

Subjective test: losses which may reasonably be supposed to be in the contemplation of the parties when making the contract as the probable result of the breach of it

Question 7

Cases in which Hadley v Baxendale was applied

Answer 7

• Victoria Laundry v Newman Industries
• Koufos v C Czarnikow

Question 8

Remoteness and assumption of responsibility

Answer 8

Whether the defendant assumed responsibility for the type of loss that actually occurred

Question 9

Transfield Shipping v Mercator Shipping

Answer 9

If damages are too remote they might not be recoverable

Question 10

Expectation loss

Answer 10

Aims to put the claimant in the position they would have been if the contract had been perfomed

Question 11

Reliance loss

Answer 11

Aims to put the claimant in the position they were before the contract was made

Question 12

Brace v Calder; Pilkington v Wood

Answer 12

Claimants are under a duty to mitigate their loss and cannot recover damages for losses that could have been avoided by taking reasonable steps

Question 13

How can you measure expectation loss?

Answer 13

• Market price rule
• Cost of cure
• Loss of chance

Question 14

Market price rule

Answer 14

contract price - market price = damages for loss

Question 15

Cost of cure (incl. case)

Answer 15

• How much it would cost to cure the damage
• HOWEVER they have to have suffered a big loss (Ruxely Electronics v Forsyth)

Question 16

Loss of chance (incl. case)

Answer 16

If they have actually pursued that course of action, based on their chances of succeeding, damages would be rewarded (Chaplin v Hicks)

Question 17

Restitution

Answer 17

• Available where there has been an unjust enrichment
• Where no contract exists, a party may reclaim money that has been paid on the other side or may have to pay for benefits received

Question 18

Quantum Meruit

Answer 18

• Where work has been done or goods supplied but no payment received and cannot be obtained
• Can claim a reasonable price for their performance

Question 19

Repudiation

Answer 19

Treating the contract as ended, so that further performance is not required by the innocent party

Question 20

Action for an agreed sum

Answer 20

Certain circumstances allow a party to sue for a non-payment of the price agreed rather than damages

Question 21

Equitable remedies

Answer 21

Provided at the discretion of the court; specific performance and injunction

Question 22

Injunction (incl. case)

Answer 22

Warner Bros v Hutton - orders the defendants not to do a particular thing

Question 23

Specific performance

Answer 23

Court order to compel someone to perform their obligations under a contract; only granted where damages alone would be an inadequate remedy