REMEDIES

Topics Included:
- Common Law Remedy
- Damages
- Claiming Damages
- Assessing Loss
- Remoteness of Damages
- Mitigation of Loss
- Types of Damages
- Ordinary Damages
- Special Damages
- Minimal Loss
- Aggravated/Exemplary Damages
- Unliquidated Damages
- Penalities
- Specific Performance
- Injunction
- Circumstances of Injunction

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Cases Discussed:
Case #1: ANGLIA TELEVISION v REED
Case #2: GODLEY v PERRY
Case #3: ADDIS v GRAMAPHONE CO. LTD.
Case #4: JARVIS v SWANS TOUR
Case #5: ALEXANDER v ROLLS ROYCE MOTORS
Case #6: RUXLEY ELECTRONICS & CONSTRUCTIONS v FORSYTH
Case #7: CHAPLIN v HICKS
Case #8: HADLEY v BAXENDALE
Case #9: VICTORIA LAUNDRY v NEWMAN INDUSTRIES
Case #10: HERON II
Case #11: ROOKES v BARNARD
Case #12: DUNLOP v NEW GARAGE & MOTOR CO. LTD.
Case #13: KEMBLE v FARREN
Case #14: BESWICK v BESWICK
Case #15: RYAN v MUTUAL TONTINE WESTMINISTER
CHAMBERS ASSOCIATION
Case #16: POSNER v SCOTT LEWIS
Case #17: PLANCHE v COLBURN

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- Common Law Remedy:
• If one party has broken the contract the other party is usually
awarded damages.
• It is a common law remedy and must be given if the contract
is proved to have been broken, although the amount is left up
for the court to decide.

- Damages:
• Damages consist of a money payment made by the party in
breach to the other party.
• The purpose of damages is to put the injured party in the
position he/she would have been in if the contract had been
performed, as well as damages to enable the injured party to
replace what he/she will also get any expense that he/she may
have incurred as a result of the breach.
• In the case of ANGLIA TELEVISION LTD. v REED, a film actor
pulled out of a film at the last minute. Anglia television were
unable to find a replacement and they had spent on hiring
other actors, finding a location and getting a script writer.
• If the breach may have caused physical injury this can also be
recovered. For e.g. if someone buys faulty goods and suffers
injury as a result, he/she can sue the goods
supplier/maufacturer for this, GODLEY v PERRY.

- Claiming Damages:
• Sometimes the plaintiff can claim damages for emotional
distress and disappointment, although in contract cases this is
an exception rather than the rule.
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• In ADDIS v GRAMAPHONE CO. LTD., damages for injured
feelings were claimed unsuccessful by an employee who had
been wrongly dismissed.
• However is JARVIS v SWANS TOUR, damages were given by
the Court of Appeal for the distress and disappointment caused
by a disastrous holiday package.
• Generally, damages for mental illness will be given only when
the object of the contract is to provide "peace of mind" or
freedom from distress and such damages would not be
appropriate in a commercial contract.
• This was confirmed by the Court of Appeal in ALEXANDER v
ROLLS ROYCE MOTORS when the owner of a Rolls Royce car did
not succeed in claiming damages for his disppointment, distress
and loss of enjoyment when a contract to repair the car was
broken.

- Assessing Loss:
• It can be difficult to asses the actual loss. In RUXLEY
ELECTRONICS & CONSTRUCTIONS v FORSYTH, the plaintiff built
a swimming pool for the defendant which was not as deep as
he wanted. He refused to pay for it and claimed breach of
contract and damages of 21,500 pounds which was the cost of
removing the pool and building another one to correct the
depth. Although he had succeeded in the Court of Appeal, the
House of Lords upheld the builders appeal and said that
because the swimming pool could still be used, albeit with less
enjoyment his damages should be limited to only compensation
for his loss of enjoyment, which was assessed as 2,500 pounds.
• Sometimes the court may have to guess what the plaintiff
might have had if the contract had been kept. The fact that
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damages are difficult to asses does not mean the court should
not try to assess the plaintiff's possible loss.
• In CHAPLIN v HICKS, the plaintiff was offered a chancee to
attend an interview with 49 other candidates, which she
accepted. The defendant promised to choose 12 candidates out
50 at the interview and offer them theatrical engagements for
three years. The defendant did not give her enough notice of
the interview and she sued for her lost chance of selection. The
court agreed that it was difficult to asses damages because she
might not have succeeded in the interview, but nevertheless
awarded her 100 pounds for her lost opportunity. Damages of
this kind are "speculative".

- Remoteness of Damages:
• A breach of contract may have far-reaching consequences.
Particularly, when it causes the injured party to lose profit that
he/she might otherwise have made.
• It may not be fair, to make the other party pay for all these
consequences and so the law fixes the boundaries of liability.
• The basic rule is that the person in breach will be liable for
those losses that a reasonable person would have expected to
result from the breach and for anything else that he/she was
specifically warned about.
• All other losses will be considered too remote from the
breach for him to be liable.
• In HADLEY v BAXENDALE the plaintiffs had sent a part of their
for repair. The defendants contracted to carry it, but delayed in
breach of contract. The palintiffs claimed damages for the
earnings lost through the delay. The defendants appealed,
saying that the damages were too remote. The court found for
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the defendant, viewing that a party could only succesfully claim
for losses stemming from a breach of contract where the loss is
reasonably viewed to have resulted naturally from the breach,
or where the fact such losses would result from breach ought
reasonably have been contemplated of by the parties when the
contract was formed. As Baxendale had not reasonably
foreseen the consequences of delay and Hadley had not
informed him of them, he was not liable for the mill's lost
profits.
• In VICTORIA LAUNDRY v NEWMAN INDUSTRIES, the breach
was the late delivery of a boiler for the laundry. The laundry
lost profits on their usualy business and also lost the chance of
a particularly well-paid contract that they had to turn down.
They recovered damages for their loss of normal profits which
was forseeable nut not for the exceptional contract which was
not.
• This compares with the HERON II case, in which a ship was
chartered to carry sugar to Basrah. The ship arrived late and
when the charterers sold the sugar they found that the price
had dropped and they lost money. The House of Lords held that
the ship owners were liable for the loss. They knew there was a
sugar market in Basrah and should have anticipated that prices
would flucuate and that this might affect the charterers.

- Mitigation of Loss:
• Like the remoteness rule, mitigation of loss also acts to put
some limit on the amount of damages the plaintiff may get.
• The plaintiff must keep their losses to a minimum and cannot
claim for any loss that could have reasonably been avoided. For
e.g. a seller whose goods have been refused by a buyer must
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try to find another buyer as quickly as possible. If the seller
waits and the price goes down they will loss out, as they wil
only get the difference between the contract price and the
resale price at the date when the contract was broken.

- Types of Damages:
• Most damages are either ordinary or special.

- Ordinary Damages:
• These are the kind that cannot be measured exactly (like the
loss of an eye) and these are assessed by the court.

- Special Damages:
• These are items such as doctor's bills which can be measured
exactly.

- Minimal Loss:
• If there has been a beach of contract but loss is minimal for
non-existent the court will give nominal damages of a few
pounds to acknowledge that the plaintiff is right.
• If they think they were technically in the right, but were
wasting the courts time with their action, they will get
contempuous damages such as one penny.
• Generally, damages are intended to compensate rather than
punish.

- Aggravated/Exemplary Damages:
• However, if the court thinks the defendant needs to be taught
a lesson, or that others need to be shown that, behaviour like
this will not be tolerated. Aggravated or exemplary damages
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may be given.
• The limits on exemplary damages are laid down in ROOKES v
BARNARD. Aggravated and exemplary damages are more
common in "Law of Tort" than in contract.

- Unliquidated Damages:
• Most damages are unliquidated. This means the court is left
to asses them.
• Sometimes, however the parties themselves will decide how
much should be paid by one party to the other if the contract is
broken.
• A typical example would be a term which said that a certain
amount should be paid for each day that a ship is late in
arriving at a port.
• The court will accept the parties' estimate of the damages
(called liquidated damages) and will order damages in
accordance with the agreement, provided the court is satisfied
that the parties agreement is a genuine attempt to pre-
estimate the loss to be suffered.

- Penalties:
• If it is not such an attempt, but an attempt to frighten the
parties into keeping the contract, it is called a "penalty clause"
and need not be enforced.
• The court will ignore the clause and either give more than is
allowed by the clause or let the affected party choose between
relying on the penalty clause and letting the court assess
damages.
• The principles for deciding whether a clause is a penalty
clause or genuine, liquidated damages are laid down by the
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House of Lords.
• In DUNLOP v NEW GARAGE AND MOTOR CO. LTD., the
defendant agreed to pay the plaintiffs 5 pounds for every tyre
sold below list price. It was held that this was a genuine
attempt to provide for a breach and therefore liquidated
damages.
• On the other hand, in KEMBLE v FARREN, an actor's contract
provided that if either he or the theatre managment broke
their contract, the party in breach must pay the other 1000
pounds as "liquidated damages".
• Despite it's name, the clause was held to be a penalty clause
because it was disproportionate to the actor's daily fee of 3.33
pounds and to the greatest possible loss that could result. It
would be unfair to charge an actor 1000 pounds for a day's
absence when infact he was only paid 3.33 pounds for his
presence.

- Specific Performance:
• A decree of specific performance is a court order telling a
party in breach of contract that they must do what they
promised to do under the contract.
• Specific performance will not be given where damages would
be an adequate remedy.
• In very unusual circumstances of BESWICK v BESWICK, a
promise to pay money was enforced by specific performance.
This was considered in connection with privity of contract.
• Specific performance will not be given if constant supervision
by the court would be needed to make sure the order was
being obeyed.
• In RYAN v MUTUAL TONTINE WESTMINSTER CHAMBERS
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ASSOCIATION, the court refused specific performance to
compel a porter to be in permanent attendence at a block of
flats.
• On the other hand, in POSNER v SCOTT LEWIS, it was granted
to compel the appointment of a porter because this was
something that did not require constant supervision.
• It will not usually be given for a contract of personal services
such as employment.
• It will not be given for a contract without consideration, and
therefore will not be given if a contract is made by deed.
• It will not be given to one party unless the other party could
get it too.
• Thus it will not be given to a minor to enforce contract that
could not be enforced against him.
• The party seeking the remedy must have behaved properly
himself.

- Injunction:
• An injunction is a court order telling someone not to do
something.
• In contract law it is usually given to enforce a "negative
stiplulation", a promise not to do something.
• This remedy is "restitutionary" it claims to restore fairness in
a situation where one person has gained at the expense of the
other.
• It means "as much as he deserves".

- Circumstances of Injunction:
• It is used in the following circumstances:
• Where there is plainly a contract but no price is fixed for e.g.
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in a sale of goods contract without a price. The court will order
payment of what the goods are worth.
• Where a contract is broken but replaced by another.
• Where a contract is discharged by frustration or breach but
one party has got a valuable benefit as in PLANCHE v COLBURN,
when one party had written half a book when the other person
said he did not want it after all.
• Where someone has performed services under a contract that
is void.

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