Contractual breach and remedies Flashcards
Case that says that in order to recover damages for loss under a contract, causation must be established
Lambert v Lewis
Case that says that consequential loss is not recoverable for breach of contract
Victoria Laundry v Newman
Remoteness test for contractual damages (case and prinsiples)
Hadley v Baxendale (courier of a part for a mill): 1. Did the loss arise naturally from the breach. 2. Were the consequences understood by both parties to be a probable result of breach at the time of contracting
Sale by description (S13 of the SoGA) - case that shows variations from description can only be tiny
Arcos v EA Ronaasen - thickness of wooden planks
Case that says there is a duty to mitigate loss suatined as a result of contractual breach
British Westinghouse electric v Underground Electric Railways
A case which shows that “in the course of business” (S12(2) SoGA) is generously interpreted by the courts
Stevenson v Rogers (fisherman sold his trawler. Selling boats was not his business, but it was still IN THE COURSE of business). CF the interpretation of in the course of business under UCTA - strict interpretation to protect consumers, eg in Feldarol Foundry - a car bought by a company for personal use of directors was NOT in the course of business
What is the general rule for the measure of contractual damages
Expectation loss - what you would have had dad the contract been performed
Case which introduced a reliance test for implied terms when there is sale of goods by description
Harlington v Christopher Hull - Buyer bought a painting because it was nice, not because of who the painter was (it was forged). No reliance on the description so no breach
A case that shows that loss of chance is easier to make out in contract than in tort
Chaplin v Hicks - loss of the chance to win a beauty pageant - P had a 1 in 4 chance of winning
What is the principle/aim of contractual damages
Expectation loss: as if the contract had been performed
A case that shows that the term implied by S14 of the SoGA as to satisfactory quality is subject to a reasonableness test (“heavy duty” buckets melted after being left in very hot sunshine)
Aswan Engineering v Lupdine
Three different ways of calculating expectation loss
- Cost of cure, 2. difference in value, 3. loss of amenity
What is the fallback rule for the measure of contractual damages
Reliance loss - the loss you have suffered in reliance of the contract being performed
A case that shows where the burden of proof lies for reliance / expectation loss
CCC Films v Impact Quadrant Films: Reliance (expenses) loss - burden is on defendant to show those expenses would not have been recouped. Expectation (profits) loss - burden is on plaintiff to show that that’s how much profit they would have made.
A case which shows that goods may not be of satisfactory quality under the SoGA even though they are useable in some way
Rogers v Parish (defective car, still driveable, seller did not fix within the agreed timescale of 6 months)
What is the remedy for a breach of a condition
Termination AND damages
What is the definition of “probable” for the purposes of the Hadley v Baxendale test for remoteness
The Heron II - serious possibility / real danger / not unlikely to result
An example of when the reliance loss measure was used to calculate contractual damages
Anglia TV v Reed - Actor repudiated contract to act in film - no way of knowing how much profit the film would have made, so reliance loss - expenses incurred so far - was awarded
A case where damages were awarded for loss of amenity
Ruxley v Forsythe - swimming pool not made as deep as specified in the contract. Cost of cure would make the plaintiff better off. There was no diminution of value.
Case that shows that the TYPE of loss, not the SPECIFIC loss must have been understood to be probable for the purposes of the Hadley v Baxendale remoteness test
Parsons v Uttley Ingham
What are the four ways that a term may be implied into a contract
By statute (SoGA 1979); where its obvious that the parties meant sometyhing to be a term (officious bystander), where a pre-contractual statement was so important, the parties must have meant it to be a term (Bannerman v White), for business efficacy
When is consideration of contributory negligence relevant in determining damages for breach of contract
When the contract stipulated a duty to take care: Vesta v Butcher
Once breach is established, what is the first thing you need to decide?
Whether the breach was of a warranty or a condition
Where the description (S13 SoGA) has little bearing on the quality / usability of goods, it is not an implied term.
The Diana Prosperity - it didn;t matter that the ship was built in a different place to that stated in the contract
Remedies under the SoGA
Damages - S51, Specific performance - S52
What is the test for whether a statement was intended to become a term of the contract
Heilbut Symons - the OBJECTIVE intention of the parties
What is the remedy for a breach of warranty?
Damages only
Alternatives to damages for breach of contract
Action for an agreed sum, specific performance, injunction, restitution
A case where cost of cure was awarded as damages
Radford v de Froberville - Wall was not built (wall not needed for any particular reason), so no difference in value or loss of amenity.
Definition of breach of contract
Where a party, without lawful excuse, fails to perform their contractual obligations
Damages for mental distress / diappointment
Farley v Skinner BUT only because it was material to the contract
