DAMAGES

  • under common law, claim is available “as of right”

  • financial form of compensation

  • where there is a BREACH OF CONDITION C can also repudiate - this means to terminante the contract so that any future contractual obligations cease

  • C doesn’t have to repudiate - can continue by AFFIRMING

  • if they affirm C loses their right to repudiate but can still claim damages

  • where there is a breach of warranty, C has no right to repudiate and can claim damages only

LIMITS ON DAMAGES

  1. CAUSATION

(but for, remoteness of damage tests)

  • where c is suing for damages, c may not be compensated for all of their losses which flow from D’s acts

  • court applies 2 tests

BUT FOR test

But for D’s breach of contract, would C have suffered the loss?

If no , then C can be compensated

if yes, then C will not be compensated

REMOTENESS OF DAMAGE : HADLEY V BAXENDALE

Loss must NOT BE TOO REMOTE- if it is then it is not recoverable. Damages are recoverable from:

i. Loss arising naturally from the breach

ii. Loss which was in contemplation of the parties at the time they made the contract

C’s owned a crankshaft ,it broke and needed to be replaced otherwise the mill would not work and orders would not get fulfilled. The claimants gave the crankshaft to a carrier and said “please take this to Greenwich” so a replacement could be made. Ok said the carriers, but they delayed. The delay meant that the will was idle, did not work and could not fulfil orders. C’s lost money because of this.

There are lots of reasons for a miller to send a crank shaft to a courier. D had no way of knowing that their breach would cause a longer shutdown of the mill , resulting in lost profits. Not liable

VICTORIA LAUNDRY V NEWMAN IND

HADLEY CASE RULE MEANS C’S CANNOT ALWAYS RECOVER ALL THE LOSS THEY HAVE SUFFERED

  • Vitoria laundry sued

  • D’s failed to deliver a boiler on time- the boiler was delivered 5 months late. Victoria Laundry was awarded : normal loss of profits but not additional BECAUSE the boiler company never knew about any special contracts that Victoria Laundry had with others

THE HERON II

  • contract to transport a cargo of sugar

  • cargo was delayed by 9 days

  • price of sugar dropped

  • c sought to recover the difference from D

  • D argued “damages are too remote”- just as likely market price could go up

  • since D must have known that market prices fluctuate, any loss would have been in his contemplation

PARSONS V UTTLEY INGHAM

  • D’s installed a pig nut hopper

  • ventilation hatch had been sealed during transport

  • nuts went mouldy

  • nuts were fed to pigs

  • pigs got sick and some died

  • c’s sued d’s

  • CoA (denning) allowed claim

WELLESLEY PARTNERS V WITHERS

Look at what is in reasonable contemplation rather than what was reasonably foreseeable?

EXPEINCE HENDIRX CASE