Remedies Flashcards
What is a remedy for breach of contract?
A remedy for breach of contract can include specific performance, an injunction, or damages.
What is specific performance?
Specific performance is an order requiring the defendant to carry out their undertaking exactly according to the terms of the contract.
What is an injunction?
An injunction prevents the defendant from doing something that the contract prohibits.
What is the principal remedy for breach of contract?
The principal remedy for breach of contract is damages, which is the payment of money.
What is the aim of an award of damages for breach of contract?
The aim is to compensate the claimant for the damage, loss, or injury suffered due to the breach.
What are nominal damages?
Nominal damages are a token amount awarded to acknowledge a breach of contract when no other remedy is available.
What are the three mechanisms for calculating expectation interest?
The three mechanisms are cost of cure, diminution in value, and loss of amenity.
What is the cost of cure?
The cost of cure represents the cost of substitute or remedial work needed to put the claimant in the position they would have been in if the contract had been properly performed.
What is diminution in value?
Diminution in value is the difference in value between the performance received and that promised in the contract.
What is loss of amenity?
Loss of amenity reflects non-economic loss, such as pleasure lost due to not receiving the contracted performance.
What is the reliance interest?
The reliance interest allows the claimant to recover expenses incurred in preparing for or partially performing the contract that became pointless due to the breach.
What is the ‘no windfall’ principle?
The ‘no windfall’ principle states that no award of damages can put the claimant in a better position than they would have been if the contract had been performed.
What is the restitution interest?
The restitution interest represents the interest a claimant has in restoring benefits that the defaulting party has acquired at their expense.
What is total failure of consideration?
Total failure of consideration occurs when one party provides something of value under the contract but receives nothing in return.
What are the remedies available under the Consumer Rights Act 2015 for non-conforming goods?
The remedies include the short term right to reject, the right to repair or replacement, and the right to a price reduction or final right to reject.
What is a liquidated damages clause?
A liquidated damages clause stipulates a certain sum payable on a particular breach of contract.
What is the law on penalties in relation to liquidated damages?
The law on penalties allows courts to strike down a liquidated damages clause that requires payment of an excessive sum, making it a penalty.
What are the consumer rights regarding defective goods?
The consumer has the following rights: (a) The short term right to reject, (b) The right to repair or replacement, (c) The right to a price reduction or the final right to reject.
What is a liquidated damages clause?
A liquidated damages clause stipulates a certain sum which is to be payable on a particular breach of contract.
What happens if a liquidated damages clause is deemed a penalty?
If a clause is regarded as a penalty, it will be struck out by the Court, and the claimant will only be entitled to ‘Unliquidated’ damages as compensation for the breach.
What is the key case regarding penalty clauses?
Key case: Cavendish Square Holdings BV v Talal El Makdessi [2015] UKSC 67.
How do courts determine if a clause is a primary or secondary obligation?
A clause is primary if it furthers the commercial objective of the contract; it is secondary if it compensates the innocent party for breach.
What are the steps to determine if a clause is a penalty?
- Identify any legitimate business interest served by the clause. 2. Assess if the detriment imposed is extravagant, exorbitant, or unconscionable.
What is specific performance?
An order of specific performance requires the defendant to carry out its obligations under a positive term of the contract.
What is a prohibitory injunction?
A prohibitory injunction is a court order restraining a party from breaching a negative term.
When will specific performance or a prohibitory injunction not be granted?
They will not be granted if damages are an appropriate and adequate remedy.
