Remedies Flashcards
Damages - expectation and reliance loss
Expectation loss = the normal rule is to compare the claimant’s position after the breach, with where they would have been if the contract had been properly performed.
Reliance loss = just claim for expenses incurred because of reliance on the contract being performed
Breach
Breach is from when say faulty bottles delivered not when these were found to be faulty.
Damages - types of loss recoverable
Pecuniary losses - easy to translate into financial terms.
Non-pecuniary losses - cannot be readily assessed in financial terms e.g. pain and suffering. Claimed in limited circumstances e.g. if one of the objects of the contract was to provide pleasure or peace of mind e.g. holiday contracts and
weddings.
Damages - remoteness of damage
If a certain loss would be an inevitable or natural consequence of breach then the parties will be deemed to have had it in their reasonable contemplation at the time of the contract and it is not remote.
Damages - mitigation of loss
Steps to reduce amount.
The burden of showing that the claimant has failed to mitigate their loss is placed
upon the defendant.
A claimant who has acted reasonably can claim for their loss, even if their
reasonable attempts to mitigate have failed to reduce their loss, or even increased it.
Damages - specified damages and penalty clauses
Specified damages clause has = a genuine attempt to pre- estimate the loss
that is likely to be caused by the breach. Such a clause is binding and the sum specified is the amount that will be paid regardless of the actual loss that the claimant has suffered.
Penalty = an attempt to put pressure on a party to perform the contract
because the sum stipulated is extravagant or otherwise disproportionately high. Unenforceable.
Action for an agreed sum
Suing for a fixed amount of money that is owed plus accrued interest for late payment.
Money has to be owed and the date for payment must have fallen due.
Specific performance
Equitable remedy.
Order requiring actual performance.
Generally only available if damages are not an adequate remedy eg in relation to purchases of land.
Injunction
Equitable remedy.
Only awarded if damages inadequate.
Commonly used to restrain the defendant from doing what they have agreed not to do.
Restitution
To prevent one party being unjustly enriched at the expense of the other party. But not available in every case.
Restitution - Recovery of money paid where there has been a total failure of consideration
A total failure of consideration is where the payee has not done any part of what they were supposed to do under the contract.
Restitution - Compensation for work done or goods supplied
- where the contract has been broken (alternative to claim for damages); and
- where a contract was never formed (but work has been done)
Restitutionary damages
Award of remedies based, not on loss to the
claimant, but on the gains made by the defendant.
Guarantees
A contract under which one person (the guarantor) guarantees that if another person (the debtor) does not pay back money owed then the guarantor will pay the money instead.
Must be evidenced in writing.
Evidence must have existed before the creditor seeks to enforce the contract and it must be signed by the guarantor.
Need not have been created for the specific purpose of enforcing the contract and may comprise a series of documents linked by reference.
Indemnities
Where one party promises to reimburse pound- for- pound the other party in respect of a particular loss arising
under the contract.
Primary obligations they do not have to be evidenced in writing.
