Remedies-Compensatory Damages Part 1

Question 1

3 types of remedies.

Answer 1

Legal remedies
Equitable remedies
Remedies under a specific statute

Question 2

Who are legal remedies available for?

Answer 2

Against a person in breach of contract as a right

Question 3

Example of legal remedies

Answer 3

Compensatory damages

Question 4

What do compensatory damages aim to do?

Answer 4

Put the wronged party back in the position they would have been had the contract never been made.

Question 5

Property of equitable remedies.

Answer 5

DIscretionary

Question 6

What does equitable remedies being discretionary mean?

Answer 6

Left to individual choice or judgement whether these remedies should be given in he circumstances

Question 7

When might courts award equitable remedies?

Answer 7

If they think legal remedies ae not the most appropriate remedy in the circumstances

Question 8

Examples of equitable remedies.

Answer 8

Specific performance
Rescission

Question 9

Example of remedies under a specific statute.

Answer 9

Consumer Rights Act 2015

Law Reform (Frustrated Contracts) Act 1943

Question 10

3 types of damages.

Answer 10

Compensatory
Nominal
Speculative

Question 11

When will nominal damages be awarded?

Answer 11

If no loss is actually suffered but there is breach, the court may award ‘nominal’ damages.

Question 12

Case for nominal damages.

Answer 12

Staniforth v Lyall (1830)

Question 13

Facts of Staniforth.

Answer 13

Lyall was under contract to load his cargo onto C’s boat by a certain date.
Failed and C sued as he wanted to be able to show the contract was over.
Meanwhile C hired his boat out to another party, earning more than he would have from the first deal.
Court agreed contract was terminated by breach and awarded C nominal damages

Question 14

ho

Question 15

Facts of Wrotham Park Estate Co. Ltd v Parkside Homes Ltd (1974).

Answer 15

C owned land which was subject to a restrictive covenant preventing building on it.

D built and sold houses on it.

C asked court for an injunction order that the houses had to be demolished.

Court said no since it would be unfair to those living in the houses.

Court awarded damages to represent amount C might have accepted in exchange for the release of the restrictive covenant.

Question 16

Difficulty with Wrotham Park damages.

Answer 16

Not clear when they should be awarded

Question 17

Traditionally, how have the courts reacted to speculative damages?

Answer 17

Have been reluctant to award damages for speculative gains which might have accrued to the wronged party had there been no breach.

Question 18

Case for courts traditional attitude to speculative damages.

Answer 18

Addis v The Gramophone Company (1909)

Question 19

Case where speculative damages were awarded.

Answer 19

Chaplin v Hicks (1911)

Question 20

Facts of Chaplin.

Answer 20

C entered beauty contest advertised in newspaper.

Readers of newspaper voted on top 50 who would be invited to an interview.

12 would be selected for employment as actors.

C in top 50 but was not given letter of invitation to interview until it was too late to attend.

Sued claiming breach of contract had lost her chance of employment.

D argue it was speculative.

Awarded damages of £100 on basis that she had been deprived of a 24% of being employed.

Question 21

Case where damages were damages of a highly speculative nature where awarded for mental distress.

Answer 21

Jackson v Horizon Holidays Ltd (1975)

Question 22

Case for speculative damages were awarded for loss of amenity where the sole purpose of the contract was for the provision of a pleasurable amenity.

Answer 22

Ruxley Electronics and Construction Ltd v Forsyth (1996)

Question 23

Facts of Ruxley.

Answer 23

D builds swimming pool 10% too shallow.

Did not effect value of property and compensation for the cost of rebuilding pool correctly (over £21,000) was unreasonable.

C awarded £2,500 for loss of amenity.

Question 24

When will compensation only be given for damages considering causation and name the test?

Answer 24

For when the damage is caused by the breach- the “but for” test

Question 25

When is causation not given-if the damage is what?

Answer 25

Too remote

Question 26

Case for damages not given due to the causation and foreseeability consideration.

Answer 26

Hadley v Baxendale (1954)

Question 27

Facts of Hadley.

Answer 27

Mill owner made a contract with a carrier to deliver a crankshaft for his mill.

Mill unable to operate as existing crankshaft broken.

Carrier did not know this and was late with delivery

Mill owner not awarded damages for lost property as carrier was unaware of importance of prompt delivery.

Question 28

What was the two-part test that Hadley establish?

Answer 28

1. Objective test- whether the loss is a natural consequence of the breach.
2. Subjective test- whether both parties have specific knowledge of potential losses when the contract is formed.