Remedies

Question 1

Explain legal remedies.

Answer 1

• Available against a person in breach of contract as of right.
• Putting C in position they would’ve been in had the contract happened.
• Court is looking at what should have happened + the consequences of non-or-part-performance.

Nominal Damages:
* Wrotham Park Estate v Parkside Homes: if no loss is suffered but there’s breach, nominal damages.
* Try to quantify sum which might reasonably have been negotiated between parties for giving permission to wrongdoer to act as he did.
Should Be Awarded When:
1) C would have very real problems in establishing financial loss.
2) ‘just’ response to breach of contract.
3) Shouldn’t be restricted to exceptional circumstances.

Compensatory Damages:
* Paid to compensate for actual losses incurred by C.
* Not automatically compensated for losses- courts apply 2 tests to determine if C should be compensated.
1) ‘But For’ Test:
* But for breach of contract, would C have suffered loss claimed? If loss would’ve happened in any event, breach couldn’t be said to have caused loss.
2) Remoteness Of Damage:
* Doesn’t establish how much compensation will be payable, but merely which losses can be subject of compensation.
* Hadley v Baxendale: test for remoteness set out.
1) What loss is a natural consequence of breach? (objective)
*2) Based on specific knowledge of potential losses in minds of both parties (subjective)
* Victoria Laundry:developed test.
* The Heron: under second part of Hadley- held D liable to compensate losses he ought to have realised were ‘not unlikely’ to result from breach.

Question 2

Explain how damages can be calculated, in relation to legal remedies.

Answer 2

Many Ways To Assess Awards Of Damages In Contract Claims:
1) Loss Of Bargain / Expectation Loss:
* To place C in same financial position as if contract had been properly formed.
* Diff in value between goods / services req in contract + those actually provided.
* Thompson v Robinson: where there’s a market, damages will be diff between contract price + price in market.
* Victoria Laundry: loss of profit not just for goods, but also in other contracts.
* Loss of chance- speculative loss not recoverable in contract.
2) Reliance Loss (Wasted Expenditure):
* Anglia Television v Reed: expense incurred by C who relied on contract being performed- can recover.
* Farley v Skinner: recover damages for loss of an amenity.
3) Liquidated Damages:
* Amount of damages has been fixed in terms of of contract.
* Courts only accept sum as award of damages if sum identified in contract represents accurate assessment of loss.
* Cavendish Square, + Parking Eye: Rule is found in the conjoined appeals. Party seeking to rely on term in contract which predetermines amount to be paid must be able to show clause is to protect legitimate interest + amount to be paid isn’t exorbitant.
4) Quantum Meruit:
* Person shouldn’t pay more than value of goods / services they’ve already been engaged with.

Question 3

Explain a duty to mitigate loss, in relation to legal remedies.

Answer 3

• Mitigate loss means do everything you can to keep costs low.
• C isn’t bound to go to extraordinary lengths to mitigate loss, only do what’s reasonable in circumstances.
• If fail to take reasonable steps, not able to claim.
• White + Carter: anticipatory breach, know of possibility of breach, but may continue until breach is an actual breach- claim for all losses.

Question 4

Explain equitable remedies.

Answer 4

• Instead of legal remedies.
• Crabb v Arun District Council: Lord Denning stated ‘equity mitigates rigours of strict law’ +. enable ‘complete justice’ to be achieved.
• Awarded when damages are an inadequate remedy + justice wouldn’t be served.
• At full discretion of court- not a right.
• Not constrained by remoteness of damage + causation

Specific Performance:
* Court orders 1 party to perform their contractual obligation.
Not available in following circumstances:
* Where damages would be an adequate remedy (e.g. substitute goods available).
* Contracts involving personal service + contracts of employment.
* Conduct of C- courts wont grant specific performance if C’s behaved dishonestly.

Recession:
* Ending a contract- treats contract as if it never existed.

Question 5

Explain termination of contract for breach.

Answer 5

• Repudiatory breach by guilty party to contract.
• In common law, breach can result in terminating of contract, if affected party so chooses where:
• Breach of condition/breach of innominate term.
• One party refuses to perform contractual obligations.
• One party makes it impossible to perform contract.