Remedies for Breach of Contract

Question 1

Redford v De Froberville (1977)

Answer 1

Breach of contract agreeing to build wall between two properties, caused no financial loss, held that the innocent party was entitled to the cost of building the wall.

Question 2

Ruxley Electronics v Forsyth (1996)

Answer 2

Swimming pool was built, but it was not the requested depth. There was no loss in value. It was held that cost of cure damages would be disproportionate to the loss suffered since the pool could still be used for its intended purpose - awarded smaller sum for ‘loss of amenity’

Question 3

Chaplin v Hicks (1911)

Answer 3

Woman entered contract meaning that she would be offered an interview for a job. In breach of contract she was not informed of the interview, it was held that she could claim damages for loss of chance based on her chance of getting the job from the interview.

Question 4

Robinson v Harman (1843-60)

Answer 4

Where a party sustains a loss by reason of breach of contract, he is, so far as money can do it, to be places in the same situation as if the contract had been performed.

Question 5

Anglia Television v Reed (1971)

Answer 5

AT entered into a contract with R so that he would star in a new TV series. R breached the contract. Expectation interests could not be claimed as AT could not prove what their financial expectations were, however the could claim damages under reliance interest, to win back the money they had invested in the new TV series.

Question 6

Surrey County Council v Brodero Homes (1993)

Answer 6

SCC sold land to Brodero homes on the basis that they would build 72 houses, in breach of this they built 77 and made extra profit. The court held that no damages were available under preventing unjust enrichment.

Question 7

Attorney-General v Blake (2000)

Answer 7

In breach of his employment contract with the government, Blake wrote a book about his time as a spy. Court allowed that the government were entitled to a remedy of ‘account for profits’ against the royalties earned by Blake - stressed that this could only happen in exceptional circumstances.

Question 8

Experience Hendrix v PPX Enterprises (2003)

Answer 8

The case in Blake was exceptional because of the deliberate nature of the breach and the relationship between Blake and his employer. In this case there was deliberate, purposeful breaking of an agreement, but the House of Lords held this was not near enough to exceptional circumstances. Possibility of awarding damages for ‘lost opportunity to bargain’, the hypothetical sum of money it would have taken for the party to agree to relax the terms of the contract.

Question 9

Wrotham Park Estate v Parkside Homes

Answer 9

Land was bought with the agreement that houses would not be built on it, this was breached, WP applied for an injunction to knock the houses down but they were instead awarded damages for lost opportunity to bargain.

Question 10

Watts v Morrow

Answer 10

Claimants bought a house based on a surveyor saying that it was in good condition, it was not, the claimant was awarded damages for distress suffered whilst living in the house and having the structural work done.

Question 11

Jarvis v Swan Tours

Answer 11

Plaintiff was awarded damages for distress and disappointment because in breach of a contract the holiday was not as enjoyable as it should have been.

Question 12

Farley v Skinner

Answer 12

Pleasure need not be sole purpose of contract - surveyor negligently said that house near Gatwick airport was fine with little noise, damages were awarded as one of the purposes of the contract was to provide pleasure and this had been interfered with.

Question 13

Hadley v Baxendale

Answer 13

A contract for repair of a flour mill was broken and the mill was closed for longer than expected, mill lost business and money. Held that the losses arose naturally from the breach and so they could be claimed for. ‘Extra’ losses could also be claimed for if they were in the contemplation of both contracting parties.

Question 14

Victoria Laundry

Answer 14

Breach of contract to install a boiler, laundry couldn’t open, lost normal business as well as a lucrative government contract, could only claim damages for the normal business lost as the government contract wasn’t in the contemplation of the parties at the time of contracting.

Question 15

Heron II

Answer 15

Contract for the carriage of sugar was delayed, market price of sugar dropped, both parties knew that there was a possibility of the market price of sugar dropping, was in reasonable contemplation.

Question 16

Transfield Shipping v Mercator Shipping

Answer 16

P rented vessel to D who was late returning it, P couldn’t rent the vessel to another on the date that was planned as D had not returned it. Held that D assumed responsibility for the losses made by P in the overrun of his lease of the ship.

Question 17

Sylvia Shopping v Progress Bulk Carriers (2010)

Answer 17

Orthodox approach to remoteness remains the standard rule, only in unusual cases should consideration of responsibility be applied.

Question 18

British Wrestinghouse v Underground Electric Railway (1912)

Answer 18

Breach of contract to supply turbines as they were deficient in power, the claimants used the turbines until they replaced them with more powerful ones even than they had originally ordered. Held: losses must be assessed against any gain rising from steps taken to lessen the consequences of the breach, the replacement turbines increased profits so they could not claim for loss.

Question 19

Payzu v Saunders

Answer 19

Contract for D to deliver discounted goods to C. C was late paying, D said that the contract may continue if C paid in cash, C bought the goods elsewhere instead at a higher price. No damages were awarded to C as they could have continued the contract.

Question 20

Cellulose Acetate Silk v Widnes Foundry (1925)

Answer 20

Stipulated that if work was late £20 a week would be payable until completion, held that this was the amount that must be paid, not the actual loss.

Question 21

Dunlop Pneumatic Tyre Co v New Garage & Motor Co (1915)

Answer 21

Clause can only be classes as penalty if the sum is extravagant compared with the greatest possible loss, one sum is stipulated for any breach (large or small) and the if the breach is non payment, that the penalty is more than the sum owed.

Question 22

Sky Petroleum v VIP Petroleum (1974)

Answer 22

SP had a contract with VP that VP would supply petrol and diesel to SP for 10 years at a fixed price. Court made order of specific performance as no alternative was available.