Remedies Flashcards
Cavendish Square v El Makdessi
1) Is the clause a primary or secondary obligation
Primary = furthers commercial objectives of contract
Secondary = triggered by breach of contract
2) Will not be a penalty clause if it clearly protects a legitimate business interest (in the commercial context) and only imposes a detriment that is proportionate to that legitimate interest (not extravagant, exorbitant, or unconscionable in comparison to interest being protected)
ParkingEye v Beavis
£85 parking fine was a secondary obligation, but was protecting a business interest (generating money for pension fund) and was proportionate to that interest
Robinson v Harman
Where a party sustains a loss by reason of breach of contract, he is, as far as possible, to be placed in the same situation as if the contract had been properly performed
The Golden Victory
Expectation loss is the usual measure of damages awarded
Birse Construction v Eastern Telegraph
BC built college for ET, who then decided there were £1.5m worth of defects
No evidence they were going to use damages awarded to repair the fault (selling building) so awarded nominal damages
McGlinn v Waltham Contractors
M contracted with WC to build a house and disliked it, so demolished and reconstructed the house
Cost of demolition and reconstruction was so unreasonable he was awarded nominal damages
Ruxley Electronics v Forsyth
F contracted with RE for a swimming pool that ended up being a few inches shallower than specified
No damage to value of property
Cost of cure was disproportionate to original contract price
Lack of intention to carry out remedial works
Settled under loss of amenity - should have a remedy where their loss is personal, not economic in value
Farley v Skinner
F bought a weekend house near Gatwick Airport, and asked S to carry out survey, specifically asks about aircraft noise - fails to notice house is directly under Mayfield Stack
Different in value was impossible to quantify, no possible cost of cure, so settled under loss of amenity
Courts will consider mental distress in contracts with the major object of relaxation, pleasure etc.
Regus v Epcot
Loss of amenity not available in commercial contracts
McRae v Commonwealth
Reliance loss used where the expectation loss is too speculative to calculate
Anglia TV v Reed
Pre-contractual expenses are available under damages
Unfettered choice between expectation and reliance loss for claimant
C&P Haulage v Middleton
Will not be allowed to escape a bad bargain
The Mamola Challenger
Claimant must show that their pre-contractual expenses would have been recovered had the contract been performed
AG v Blake
Restitution interest available in:
1) Exceptional circumstances
2) Traditional remedies are inadequate
3) Claimant has a legitimate interest in preventing the defendant’s profit-making activity and therefore depriving him of profit
An efficient breach would not be sufficient
Esso v Niad
Liberal approach to restitution - successful claim in commercial breach
The Sine Nomine
Restitution not allowed if damages are adequate
Experience Hendrix v PPX Enterprises
Preventing unlicensed recordings of Jimi Hendrix was not an exceptional case and not concerned with anything as special or sensitive as national security
Addis v Gramophone Company
General rule - no damages for mental distress, anguish or annoyance in contract law
Jarvis v Swan Tours
Mental distress allowed when whole purpose of contract is enjoyment/relaxation/pleasure/peace of mind
Hayes v Dodd
Mental distress/anguish/annoyance not recoverable in commercial contracts
Malik v BCCI
Loss of reputation is recoverable if the claimant has a reputation to be lost
Chaplin v Hicks
Loss of chance recoverable if quantifiable in monetary terms and there was a real and substantial chance that the opportunity might have come to fruition
Galoo v Bright Grahame Murray
Breach must have been the dominant and effective cause of the loss
Common sense approach
Lambert v Lewis
NAI can break chain of causation if unforeseeable and unreasonable (farmer continued using defective trailer - amounts to NAI breaking chain of causation between manufacturer and claimant)
Monarch Steamship v Kalshmans
Outbreak of WWI did not break chain of causation - ship’s defect was dominant and effective cause
Hadley v Baxendale
1) Did the loss arise naturally from the breach - would a reasonable person have expected that loss?
2) Was the loss reasonably in the contemplation of both parties at the time of contracting (actual knowledge)?
Jacksons v Royal Bank of Scotland
Special losses have to be communicated prior to contracting rather than prior to breach
Victoria Laundry v Newman Industries
Loss of general profits was recoverable (arose naturally), loss of highly lucrative special contract was not (not communicated to defendant’s at time of contracting)
The Heron II
Arising naturally from the breach = ‘loss not unlikely to occur’
The Achilleas
Traditional approach = Hadley v Baxendale, as amended by Heron II
May not apply where accepted in the commercial context, those losses would not be awarded (e.g. loss of subsequent charter party)
British Westinghouse v Underground Electric
Reasonable steps required = what a reasonable businessman would do to minimise the loss attributable to the breach of contract
Pilkington v Wood
Mitigating party not expected to embark upon litigation
Payzou v Saunders
May have to accept breach if cost-effective
Banco de Portugal v Waterlow
Mitigation is not weighed in nice scales - as long as steps are reasonable, the courts will not look to what further steps he could have taken
Vesta v Butcher
Contributory negligence generally not available for breach of contractual duty (strict liability) unless for negligence arising independently of contract
