Remedy of contract law

Legal remedies:

damages or remedies against goods.

Equitable remedies

discretionary court orders.

Statutory remedies:

provided under Acts- CRA 2015 & Law Reform (frustrated contracts) Act of 1943

Compensatory Damages

A claim for damages is always available if a contractual term is broken.

So even if the claimant hasn’t suffered a loss, still the court has to make an award of damages.

Purpose: To restore the claimant to their pre-breach position.

Expectation loss

loss of a bargain

Reliance loss

wasted expenditure

1. Nominal damages:

When no actual loss is suffered.

Staniforth v. Lyall

Lyall had a duty to load Staniforth’s boat by a certain date but failed to do so. However, Staniforth did not suffer any actual financial loss because he was able to hire the boat to someone else. Despite this, the court awarded nominal damages to acknowledge that a breach of contract had occurred.

“Wrotham Park Award”

Type of damages awarded when a party breaches a contractual obligation, but the innocent party does not suffer a direct financial loss.

Instead of compensating for actual loss, the court awards a sum that represents the amount the innocent party might have reasonably charged for allowing the breach to occur.

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

A developer built houses in violation of a restrictive covenant. Instead of ordering demolition, the court awarded damages based on what the landowner could have negotiated in exchange for releasing the restriction.

2. Speculative damages

Awarded when nominal damages are inappropriate

Chaplin v. Hicks

Chaplin v. Hicks

The claimant, Chaplin, entered a beauty contest where the winners would receive auditions for acting roles. She was selected as one of the finalists but was not given the opportunity to attend the audition due to the defendant’s breach. The court ruled that she was entitled to damages for the lost chance of being selected for an acting role.

Hadley v Baxendale

A mill owner sued a carrier for late delivery of a crankshaft, which caused business losses. Established 2 part test for remoteness:

1. Loss must be a natural consequence of the breach.- objective

2. it must be in the contemplation of both parties at contract formation.- subjective

Mitigation of loss means:

The injured party should take reasonable steps to minimize the effects of the breach.

Liquidated damages

Where the amount of damages has been fixed by the terms of a contract.

Courts will only accept this if it is accurate and has a proper assessment of the loss.

Equitable remedies

When damages are inadequate remedy and justice won’t be served with it.

They are not a right, but at the discretion of the court.

So providing a remedy that is appropriate and just