remedies Flashcards
what are the three remedies studied?
-compensatory damages
-equitable remedies of specific performance and rescission
-termination of contract for breach
what are compensatory damages?
aim to put the injured party back into the position they would have been in if the contract was completed
what are the two types of compensatory damages?
-liquidated
-unliquidated
what are liquidated compensatory damages?
-damages that were negotiated and agreed on as part of the contract
-fixed amounts can be ignored by the court if they don’t represent a fair and proper assessment of any loss, or if they seek to just punish a party for a minor breach
-if its a proper reflection of loss, the courts will enforce it
-penalty = exceeds the breach
-Dunlop Pneumatic Tyre Co v New Garage and Motor Co
what are unliquidated compensatory damages?
-no damages were agreed on in the contract, the innocent party needs to make a claim
-courts fix the amount based on the loss
-looks at causation, remoteness of loss and duty to mitigate loss
what is meant by causation in relation to unliquidated compensatory damages?
-court looks at what factually caused the loss (but-for defendants actions)
-intervening act can break the chain of causation
-Stansbie v Troman
what is meant by remoteness of loss in relation to unliquidated compensatory damages?
-it isn’t practical for every damage following the breach to be compensated for
-Hadley v Baxendale (decided the carrier wasn’t responsible for 2 reasons-
1-the absence of a mill shaft would not normally cause a loss, since the mill owner could have a spare
2-the carrier wasn’t aware that the claimant could not restart production until a new shaft was made)
-damages should be awarded where they arise naturally from the breach, or were reasonably in contemplation of both parties at the time the contract was made
what is meant by mitigation of loss in relation to unliquidated compensatory damages?
-common sense should prevail that following a breach, the injured party should try to lessen/mitigate any actual/potential loss
-if the claimant just allowed the consequences to worsen, the courts wont provide damages for the further loss
-but if the alternative is unreasonable, they aren’t expected to act
-its the defendants job to prove the C failed to follow a reasonable path to mitigate further loss
-British Westinghouse and Manufacturing Co Ltd v Underground Electric Railways of London Ltd
what are equitable remedies?
-at the discretion of the court
-2 types
-specific performance
-rescission
what is specific performance?
-requires the defendant to carry out their agreed obligations under the contract
-courts can order specific performance and/or damages
-orders for specific performance are rare, bcs usually if a party isn’t fulfilling their end its because its impossible/incredibly difficult
-but sometimes damages won’t compensate the injured party as the goods /services have distinctive characteristics
-based on whether it’s fair (de francesco v barnum)
-excessive hardship means it wont be ordered (dyster v randall and sons)
what is rescission?
-attempting to place both parties back into the positions they were in before the contract
-available where a contract is voidable as a result of a vitiating factor
-right to rescind may be lost where:
-claimant affirms the contract
-a third party acquires the rights of the goods (car & universal credit v caldwell)
-time has lapsed (leaf v international galleries)
-where restitutio in integrum is impossible (restoring injured parties)
when is termination used?
-when there has been a breach of contract
-breach of condition can allow for suing for damages and/or repudiation
-breach of a warranty can allow for damages only
-breach of an innominate term can allow for suing immediately or suing once the contract has reached its performance date
