Remedies Flashcards
What is a legal remedy?
Remedies that come from common law (rules developed through legal precedent)
What is the main legal remedy in contract law?
Damages
What are statutory remedies?
Remedies which come from a specific act of Parliament
Under Consumer Rights Act 2015, what remedies are available?
Examples for remedies in consumer/trader contracts are repeat performance
What is quantum meruit damages?
For substantial performance etc if performance was incomplete but one of the exceptions to Cutter applies.
What is an equitable remedy?
These come from the rules developed by the law of equity which means court orders such as injunctions
Damages is a right if the claimant has won an action for Breach of contract. This means that the claimant will still receive damages even if …
They haven’t suffered from any financial loss
What purpose must the court try to achieve when it calculates the amount of damages C should receive?
Put the victim back into the position you would’ve been in if the contract would have gone to plan.
When are nominal damages awarded?
When the claimant hasn’t suffered any loss
Why might someone bring a claim such as nominal damages?
To achieve justice when there has been no loss but justice is served by making D pay more than nominal damages
Courts began gradually to allow damages for some damages in 1970’s such as?
If the whole of main purpose of the contract was for pleasure
Can damages be awarded for a loss of amenity?
Yes - as it is for pleasure
Loss of amenity - Jackson v Horizon
Group booking for a holiday that wasn’t satisfactory. Therefore, loss of amenity.
Loss of amenity - Jarvis v Swan Tours
Holiday wasn’t as expected - loss of amenity.
Loss of amenity - Ruxley Electronics v Forsyth
Cost of rebuilding the pool to the correct depth was totally unreasonable and would make no difference to the value of the house - so loss of amenity not whole project.
Farley v Skinner
Disappointing house purchase because the house was unexpectedly noise - loss of amenity
How are damages calculated?
- Court needs to decide which losses can be compensated
- The court needs to decide how much compensation should be awarded for these losses
Which losses can C claim for?
To decide which losses can be compensated, the court uses ‘causation and remoteness of damage’ principles
Causation and remoteness of damage - Hadley v Baxendale
Carrier was late with delivery of crankshaft. He was unaware that the C’s didn’t have a spare.
Hadley 2 part test
The test tests which losses were caused by D’s breach and can be compensated and which losses are too remote from the breach
Hadley 1 (objective)
Obvious losses
Hadley 2 (subjective)
Possible losses known about to both parties at the time the contract was formed.
Hadley test - Victoria Laundry v Newman
Loss of usual profits (natural consequence of breach). Additional losses could not be compensated.
What if it cannot be proved that D was aware of the possibility of that kind of loss?
The court may say it is implied that D was aware because a reasonable person would not have been aware.
The Heron II
Reasonable to suppose that D meant to sell the sugar as soon as it arrived. “Within the reasonable contemplation of the parties at the time of the contract”
How much can be awarded for these losses?
Different principles are used to calculate how much money to award e.g. loss of bargain principle
Loss of bargain principle
This means that the court will grant a sum of money which will put C in the same financial position as if the contract had been properly performed
Loss of bargain - Charter v Sullivan
No loss of profit, nominal damages only
If C has offered no loss of profit, will any damages be awarded?
Yes, but nominal damages only
Reliance loss principle
This is an alternative to damages for expectation loss where these are too difficult to calculate
C can recover any money s/he had relied on the contract being performed
Anglia TV v Reed
Anglia TV v Reed
TV company in preparing for a film, D pulled out and replacement could not be found. ‘ Reliance loss’ damages awarded.
Mitigation of loss
Damages may be reduced if C has failed to mitigate the loss. when D has breached the contract, C must not do anything which makes the loss even greater than it is.
Mitigation of loss - Whiter v Carter
D’s told C that they no longer wanted advertising. C still carried on preparing and successfully claimed for all preparation . Mitigation not used.
How did the claimant mitigate their loss in Thai Airways v KI Holdings and what had to be taken into account when calculating their damages?
By hiring other aircrafts as there was more fuel efficiency. They had to take into account the saving of the others being more fuel efficient.
Liquidated damages
An amount of damages which are stated in term of the contract. The ideas is that the parties have agreed in the contract, how much compensation will have to be paid by the other party if the contract is breached.
Where does the test for liquidated damages come from?
Cavendish Square Holdings and Parking Eye v Beavis.
Both these cases state that the term which sets out an amount to be paid if the contract is breached must..
- Be to protect a legitimate interest
- Not be exorbitant or unconscionable
However…. (Cavendish Square Holdings / Parking Eye)
- D does not have to show that s/he actually suffered loss.
- The amount stated in the term does not have to be a genuine pre-estimate of the amount of loss
- The purpose of the amount in the term can be to deter a specific breach
What is the aim of these rules?
To protect freedom of contract. The effect is that courts are less likely to see these terms as ‘penalty clauses’ in the future and more likely to award the amount specified in the term.
What are the two main equitable memories?
Injunctions and specific performance
What is an injunction?
This is a court order not to breach a contract
What is a prohibitory injunction?
Forbidding the parties not to breach a contract
What is a mandatory injunction?
Order to perform an act for something e;se
What is a temporary injunction called?
Interlocutory injunction
Why was the interim injunction granted in AB v CD?
To prevent breach of contract regarding intellectual property rights before trial
When will mandatory injunctions not be awarded for?
When the effect being to enforce a contract for personal service because this would be unfair on the party.
Why did the court decide not to grant specific performance in Airport Industrial v Heathrow?
As it would have forced the party to be liquidated.
Page One Records v Briton
Court refused to grant an injunction to stop them from parting as it would have meant that they had to have a manager for 5 years that they had lost confidence in
What is specific performance?
It compels someone to do something (as agreed to in the contract)
Specific performance is often granted where…
- Damages are inadequate
- Damages would only be nominal
Damages are inadequate
e.g. for unique property e.g. a house or a rare antique UNLIKE Cohen v Roche
( Not granted - Hepplewhite chairs were rare, not unique )
Damages would only be nominal
e.g. Beswick v Beswick
Uncle had not lost anything so damages only
Equitable remedies may not be available in situations where…
- It would cause hardship
- In contracts for personal services or employment
- In contracts which require monitoring to an ongoing obligation
- In vague contracts or where only nominal consideration was provided
- Where the contract was obtained unfairly
It would cause hardship - Patel v Ali
No specific performance. Mrs P had considerable hardship.
In contracts for personal services or employment - Trade Union and Labour Relations Act 1992
Specific performance will not be granted forcing an employee to continue working for someone else ( s236 )
Contracts for personal services or employment - Irani v Southampton
C’s relationship with employer (NHS) had not broken down - just his relationship with a senior colleague
In contracts which require monitoring of an ongoing obligation - Co Op Insurance v Argyll Stores
Refused to grant specific performance “ the settled practice of the court not to force businesses to carry on trading against their wishes “
Where the contract was obtained unfairly
e.g. “not coming to equity with clean hands”
Walters v Morgan
Walters v Morgan
Court wouldn’t grant specific performance because the contract was obtained unfairly. C had behaved inequitably.
