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Contract Law 2 > Remedies > Flashcards

Remedies Flashcards

1
Q

What is a remedy?

A
  • instruments provided by the law in order to protect the injured/innocent party
  • They provide incentives to perform contractual obligations
  • increase the certainty of contracts and thereby encourage parties to rely upon their contract, in the knowledge that their interests will be protected even if the other party does not perform
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2
Q

What is the main contractual remedy?

A
  • Damages
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3
Q

What are damages?

A
  • Monetary compensation for injury suffered by reason of a breach of contract
  • Can be nominal to simply give compensation so no one suffers loss
  • Can be Exemplary in order to punish the breach made by D
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4
Q

What are the three basic measures of damages?

A
  • Expectation/performance measure
  • Reliance measure
  • Restitutionary measure
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5
Q

What are expectation damages?

A
  • aim to put C into the same (financial) position in which she would have been had the contract been properly performed
  • In so far as money can do this ( because the C would not be in the exact same position generally as they may now not have the sales they needed or otherwise so damages simply try’s its best ‘so far as money can do this)
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6
Q

What are reliance damages?

A
  • aim to put C into the same position in which she would have been had she never made the contract
  • compensate C for loss suffered as a result of relying upon the contract.
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7
Q

What are restitutionary damages?

A
  • aim to ensure D is not unjustly enriched (by the breach) at C’s expense
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8
Q

What is the general rule of damages?

A
  • C is entitlement to choose which of the three types she wishes to claim
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9
Q

When can’t the general rule of C being able to choose her own damages be used?

A
  • C cannot elect to have reliance damages so as to shift to D the loss caused by the fact that C has made a bad bargain
  • The Mamola Challenger [2010]
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10
Q

Which case demonstrates that there is an exception to the general rule of choosing damages and that reliance can not be used to cover up a bad bargain?

A
  • The Mamola Challenger [2010]
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11
Q

What is the standard type of damages?

A
  • Expectation
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12
Q

Why are expectation damages the standard type of damage?

A
  • Protect C’s performance interest. They seek to put C into the same financial position in which she would have been had the contract been performed.
  • if C has made a good bargain, expectation damages will generally be the most favourable measure of damages as they include profit C would have made on the contract.
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13
Q

What is the equation for working out expectation damages?

A
  • Value of contractual performance - Value of actual performance = Expectation damages
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14
Q

What is the equation for reliance damages?

A
  • Amount spent by C in reliance upon the contract - Value received under the contract = Reliance damages
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15
Q

What is the general rule for WHEN damages are assessed?

A
  • At the time of breach

- The market prices of fluctuating items at that time

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16
Q

What case shows that the general rule of WHEN damages are assessed is not a fixed one and can fix such other date as may be appropriate in the circumstances?

A
  • Johnson v. Agnew [1980]
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17
Q

Golden Strait v. Nippon Yusen [2007]

A
  • D chartered (hired) a ship from C, D then repudiated the contract
  • C sued for damages but by the time the case came to trial, the second Gulf War had broken out
  • Under the terms of the contract, this would have entitled D to terminate the contract w/out being in breach
  • Therefore, assessment of damages as at the date of the breach would have ignored the fact that D would have been lawfully entitled to terminate the contract
  • HL held that it was appropriate to take account of the outbreak of war
  • The reasoning of the House was that general purpose of damages is to put C into the same position in which he would have been had the contract been properly performed and had the contract been properly performed , it would have come to an end at the outbreak of War.
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18
Q

What happens if a contract price is higher than a market price (bad bargain)?

A
  • Reliance damages will lead to a greater award than expectation hence when a bad bargain such as this has be processed the C can not choose reliance damages as it put them in a better position than they should be at the expense of D
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19
Q

When is C entitled to damages?

A
  • AS A RIGHT TO ANY BREACH OF CONTRACT
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20
Q

What will damages be if the C cannot prove rules regarding to causation, remoteness and mitigation?

A
  • Nominal
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21
Q

What are nominal damages?

A
  • A small sum of money awarded as damages to someone who has suffered a legal wrong but no actual financial loss. (or cannot prove the financial loss)
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22
Q

What are substantial damages?

A
  • Damages that cover not only the fact one has been legally wronged by the breach but also any financial loss incurred
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23
Q

What is the principle of remoteness of damage?

A
  • An element of the rules of causation
  • It regulates the type of loss that is recoverable
  • Means that only those losses that were a REASONABLE FORESEEABLE consequence of D’s breach are recoverable
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24
Q

What is the principle of mitigation of damages?

A
  • Seeks to reduce economic waste
  • C cannot recover any damages to compensate her for losses that she should reasonably have avoided (Bad bargains for example)
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25
Q

What case is an example of expectation damages?

A
  • Robinson v. Harman (1848)
  • ‘The rule of the common law is, that where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed’
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26
Q

Robinson v Harman 1848

A
  • Example of expectation damages
  • ‘The rule of the common law is, that where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed’
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27
Q

What is the cost of cure method in assessment of expectation damages?

A
  • The amount it would cost to remedy the defects in D’s performance
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28
Q

What is the difference in value method in assessment of expectation damages?

A
  • Value of contractual performance-Value of actual performance
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29
Q

What is the general rule in the C’s rights to elect which method should be used to calculate expectation damages?

A
  • They generally have the right or choose either cost of cure or difference in value method.
  • This is because both methods generally come to very similar financial outcomes and compensate the C in the same/similar way
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30
Q

What happens when the cost of cure greatly outweighs the difference in value and vise versa?

A
  • C will not be entitled to cost of cure assessment of damages unless she can show some special reason why this is appropriate and vise versa.
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31
Q

What is the general principle of reasonableness in damages?

A
  • C will only be awarded damages that are reasonable
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32
Q

Ruxley Electronics Construction v. Forsyth [1996]

A
  • D contracted to build a swimming pool for C
  • Contract stipulated pool to be 7’6” deep
  • In breach, merely 6’ deep
  • Evidence showed no difference in value between a pool 6’ deep and one 7’6” deep
  • However, cost of cure, to drain, re-dig, lay the bottom, etc., would have been £21,560
  • HL held C not entitled to cost of cure assessment
  • entitled to loss of amenity damages it would have been unreasonable to confine him to nominal damages, (£2,500) loss of amenity damages were awarded to protect C’s performance interest]
  • ‘[T]he cost of [cure] is not the appropriate measure of damages if the expenditure would be out of all proportion to the benefit to be obtained’
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33
Q

What case shows that cost of cure damages would not be allowed in circumstances where C would unreasonably benefit?

A
  • Ruxley Electronics Construction v. Forsyth [1996]
  • ‘[T]he cost of [cure] is not the appropriate measure of damages if the expenditure would be out of all proportion to the benefit to be obtained’
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34
Q

when will cost of cure damages be out of all proportion to difference in value damages?

A
  • There is no definitive answer
  • It must all depend upon the individual facts of the case, perhaps taking account of both the amount and the percentage difference.
  • If the court does not believe that he has a genuine intention to remedy the defects it could be a further factor in not allowing the cost of cure to be used.
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35
Q

Robinson v. Harman (1848)

A
  • The main purpose of damages is to place C as near as possible into the same position as if the contract had been properly performed so far as money can do it
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36
Q

What case shows that the main purpose of damages is to place C as near as possible into the same position as if the contract had been properly performed so far as money can do it?

A
  • Robinson v. Harman (1848)
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37
Q

Could cost of cure still be allowed, even if it is significantly more beneficial that difference in value?

A
  • Yes if it would not be unreasonable to as award it and they are not out of proportion ( massively higher)
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38
Q

The Mamola Challenger [2010]

A
  • C contracted to charter (hire) its ship to D
  • The charter rate was less than the market value
  • D repudiated the contract
  • C immediately hired the vessel out to another party, at the market rate, thus earning more than it would have done had the contract been performed by D
  • As such, C could not claim expectation damages, because, by such a measure, it had suffered no loss
  • The court also DENIED RELIANCE DAMAGES
  • To allow such would have been to put C in a better position than it would have been in had D properly performed
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39
Q

What 2 main circumstances may C want to claim reliance damages and may be allowed to do so?

A
  • Where the bargain is speculative and it cannot easily be assessed what (if any) profit C would have made.
  • Where C has incurred high reliance-based expenditure prior to the contract being made. (spent monies in other areas in the expectation of what would occur in the contract)
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40
Q

What happens when a bargain is speculative and cannot be proven how much money C would gain?

A
  • Expectation would not be available as it only works on proven loses
  • Therefore depending on the circumstances reliance may be allowed
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41
Q

Anglia Television v. Reed [1972]

A
  • C contracted w/D, for D to star in a TV show but D repudiated.
  • C could not find a suitable alternative star so cancelled production
  • There was no way of telling whether C would have made a profit or how much
  • Therefore c could not claim expectation
  • Before D repudiated the contract, C had incurred a number of expenses (preparation)
  • D argued C was only entitled to recover expenses incurred after concluding the contract
  • CA held that expenses incurred in reliance upon the contract were recoverable, even if they were incurred before the contract was made
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42
Q

What case can be used to demonstrate that due to a case being speculative on how much money may be made and where c has incurred high reliance based expenditure, reliance may be successful?

A
  • Anglia Television v. Reed [1972]
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43
Q

What are the two types of loss?

A
  • Pecuniary (financial) loss (All pecuniary loss caused by D’s breach is recoverable, unless too remote or C has failed in her “duty to mitigate”.)
  • Non-pecuniary loss ( More complicated to recover)
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44
Q

What are the 2 types of pecuniary loss?

A
  • Loss of chance

- Loss of performance promised to third party

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45
Q

What is loss of chance as a type of pecuniary loss?

A
  • Compensates for the loss of chance to make the profit where it can not be proved whether C would or would not have secured benefit had the breach not have occurred
  • law generally takes a flexible approach to assessment of damages for loss of a chance.
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46
Q

Chaplin v. Hicks [1911]

A
  • C entered a contest to win one of 12 available 3-year contracts as an actress
  • She was selected as one of 50 finalists
  • In breach, D failed to give her reasonable opportunity to present herself for the final judgment
  • D argued she was entitled only to nominal damages, as it could not be proved that she lost anything
  • Court accepted jury’s award of substantial damages, on the basis that she lost a 12 in 50 (rounded to 1 in 4) chance of winning
  • The award was a reasonable sum to compensate for the LOSS OF CHANCE
47
Q

What case demonstrates the use of loss of chance as a type of pecuniary loss?

A
  • Chaplin v. Hicks [1911]
48
Q

What is Loss of performance promised to third party?

A
  • The doctrine of privity says a person not bound by the contract cannot claim damages under the contract. But if C would not actually gain any benefit as it is X that is gaining it can C claim for the loss of X
  • If D’s breach therefore puts C in breach to X then C can claim damages that they will be sued for by X
  • If however C has no legal obligation to X the law is
    not completely clear, but it seems C can recover damages for loss of a performance to X if certain circumstances occur.
49
Q

In what circumstances would C be able to claim for the loss of X even when they have no legal obligation owed to them?

A
  • Where D’s performance was to be in satisfaction of C’s duty to X
  • The so-called Albazero exception applies
  • The purpose of the promised performance was to secure some pleasure, relaxation or peace of mind for X (loss of amenity).
  • C has remedied, or genuinely intends to remedy, the defective performance, even though not legally obliged to do so.
50
Q

What is the so-called Albazero exception?

A
  • Broadly, C can recover damages, which she holds on trust for X, where:
  • C contracts w/D for D to deliver to X goods to be sold by C to X and D’s breach damages those goods when risk had passed to X (C has no duty to ensure the goods arrive)
  • OR C contracts w/D for D to do building work, and it is known that X is likely to own or occupy the building and it is defective
  • However, note that if X can recover on their own account C cannot claim
51
Q

What case demonstrates the Albazero exception?

A

-Alfred McAlpine v. Panatown [2001]

52
Q

Alfred McAlpine v. Panatown [2001]

A
  • C contracted w/D for D to build on X’s land, the building to be owned by X
  • D entered separate duty of care deed w/X, under which it assumed a duty of care to X
  • C alleged D’s performance was defective, requiring £40M for correction
  • D argued C only entitled to nominal damages, as it had not suffered any loss
  • By a bare majority, HL held that C was not entitled to substantial damages
  • C suffered no loss but If C had effected, or genuinely intended to effect, a cure, he would have potentially been entitled to cost of cure damages
    • X could recover their own damages here under the duty of care deed
53
Q

Give an example of a non-pecuniary loss

A
  • Compensation for an injury, diminished reputation, mental distress
54
Q

What is the general rule in regards to non-pecuniary loss?

A
  • not recoverable, and this is primarily because of problems of proof and quantification of loss.
55
Q

What are the 3 exceptions to the general rule in regards to non-pecuniary loss?

A

1- Loss of an amenity
2-Where the object of the contract was to provide pleasure
3- Physical inconvenience

  • Although 1 and 2 kind of go together
56
Q

When would someone receive non-pecuniary damages?

A
  • if the purpose of the term breached was to provide pleasure
  • … AND that term was an important term of the contract
57
Q

Jarvis v. Swan Tours [1973]

A
  • C contracted w/D for provision of a holiday, described in glowing terms
  • In particular, D promised there would be a ‘house party’ atmosphere
  • During first week, only 13 guests at the hotel and, in the second week, C was the only guest
  • Held that D in breach or C entitled to damages for misrepresentation assessed on same basis; descriptions in the brochure went beyond mere sales talk
  • D argued C not entitled to damages for mental distress suffered by reason of the breach
  • CA accepted general rule
  • However, exception to the rule in the form of damages for loss of amenity, which they awarded to C
  • Lord Denning MR stated that the loss of amenity exception applies
  • C was awarded a sum representing 2 weeks’ salary, because he had taken his 2 weeks of annual leave for the holiday
58
Q

Which case can be used to demonstrate loss of amenity in terms of non-pecuniary damages?

A
  • Jarvis v. Swan Tours [1973]
  • ‘where the contract is one to provide entertainment and enjoyment. If the contracting party breaks his contract, damages can be given for the disappointment, the distress, the upset and frustration caused by the breach’
  • It was quite clear, like most holiday contracts, the whole purpose of the contract was to provide pleasure to C.
59
Q

What approach is taken by the courts in the decision of whether non-pecuniary damages should be granted for loss of amenity?

A
  • a common sense approach as there is no set measures
60
Q

What is the disadvantage of the common sense approach to granting non-pecuniary damages for loss of amenity?

A
  • It cannot be accurately predicted what damages will be in a given case.
  • It is uncertain as to when a term constitutes an important enough one
61
Q

What is one of the fundamental principles of contract law?

A
  • Certainty
62
Q

Knott v. Bolton [1995]

A
  • Cs engaged D to design their “dream home”
  • They stressed to D the importance of having a grand staircase and landing area
  • In breach, D failed to provide this important feature
  • CA held Cs not entitled to damages for loss of amenity because, although providing pleasure was an important object of the contract, it was not the whole object of the contract, which included the basic pecuniary element of providing a home
  • MAY HAVE SUCCEEDED WITH DAMAGES IN PRESENT IF THE GRAND STAIRCASE WAS CONSIDERED AN IMPORTANT TERM
63
Q

Which case shows that non-pecuniary damages would not be rewarded for loss of amenity where the whole object of the contract was not to provide pleasure, even if it was still an important one, CONTRARY TO WHAT THE CURRENT LAW IS?

A
  • Knott v. Bolton [1995]
64
Q

Farley v. Skinner [2002]

A
  • C contracted for D to perform a survey of the house C intended to buy
  • C was, in particular, concerned about aircraft noise
  • D reported that noise from aircraft should not be a problem
  • C purchased house and found that aircraft noise greatly disturbed enjoyment of the house
  • D argued C was not entitled to damages for loss of amenity, as it could not be said that the purpose of contract was to provide pleasure, relaxation or peace of mind
  • However, D conceded this was the purpose of the term regarding evaluation of aircraft noise
  • HL allowed damages for loss of amenity on basis that AN important purpose of contract was the provision of pleasure, relaxation or peace of mind, and the term which was breached was the very one the purpose of which was to secure this
  • Aircraft noise also caused physical inconvenience
65
Q

Which case demonstrates the most common rule on non-pecuniary damages successfully being awarded for loss of amenity on basis that A term was an important purpose of contract?

A
  • Farley v. Skinner [2002]
66
Q

What are the essential characteristics needed to claim physical inconvenience for non-pecuniary damages as set out in Farley v Skinner 2002?

A
  • If the cause of the inconvenience or discomfort is a sensory (sight, touch, hearing, smell etc) experience, damages can, subject to the remoteness rules, be recovered
67
Q

Which case shows that damages will not be rewarded simply for a damaged reputation?

A
  • Groom v. Crocker [1939]
68
Q

In what way could damages be claimed for a damaged reputation?

A
  • damages for pecuniary loss caused by the injury to reputation are recoverable (but often will be hard to prove)
69
Q

Groom v. Crocker [1939]

A
  • C involved in accident w/X
  • Accident X’s fault
  • However, as part of an agreement w/X’s insurer (which involved settling an additional claim between the insurers, unrelated to C’s claim), C’s insurer admitted negligence on C’s behalf
  • Copy of admission on C’s behalf sent to D, C’s solicitor
  • In breach of contract, D did not object to admission of negligence
  • C not entitled to damages for injury to reputation caused by D’s breach in accepting admission of negligence because no financial loss suffered
70
Q

What case shows that damages could be recoverable for damage of reputation, if the C can prove pecuniary loss occurred?

A
  • Cointat v. Myham [1913]
71
Q

Cointat v. Myham [1913]

A
  • In breach, D delivered to C meat unfit for human consumption, for sale in C’s butcher shop
  • Meat seized by inspector and health warning issued against C’s shop
  • C successfully recovered damages for loss of trade caused by the injury to his reputation, which he sustained as a result of D’s breach
72
Q

What can the prohibition on damages for “pure” injury to reputation be an example of in terms of analysis?

A
  • The desire for certainty winning out over the desire for fairness to C
  • Too difficult to prove that there was an injury to reputation, w/out proof of some form of direct pecuniary loss
73
Q

What are the three main issues of certainty regarding damages awarded for damaged reputation?

A
  • Difficult to quantify loss
  • If no proof of financial loss it can not be considered whether someones reputation has actually been damaged
  • Equality before the law and therefore if something cannot be proved a party/individual can not be held accountable
74
Q

What is the basic purpose of specific performance?

A
  • To compel D to perform her contractual obligations.
75
Q

When is Specific performance available?

A
  • Used to only be available when damages were not adequate
  • Now it is available if it is the most appropriate remedy
    regardless of whether damages could still be used, however usually it still follows the historic rule
  • change, from requiring damages to be an inadequate remedy, to requiring proof that SP is the most appropriate remedy
76
Q

When can specific performance be granted?

A
  • It is at the discretion of the courts in theory but there are rules set out as to when SP can be used
77
Q

What are the two types of damages?

A
  • Nominal

- Substantial

78
Q

In what 3 situations would damages be inadequate and SP should be used instead?

A

1- Where Damages would Be Difficult to Quantify

2- Where C would Be Entitled Only to Nominal Damages (For example when D’s breach was in relation to performance from a 3rd party)

3- Where the Subject-matter of the Contract Has a Unique Value

79
Q

Aderley v. Dixon (1824)

A
  • D was entitled to such dividends as might become payable from what would be left after all of the bankrupt’s debts had been satisfied
  • He assigned this to C but then refused to perform
  • C sought, and was awarded, SP
  • Court held damages not adequate remedy, because it could not calculate the amount that would be due to C (as it was not known), so it could not determine what C’s loss would be
80
Q

Which case shows that damages would be an inadequate remedy if they would be difficult to quantify?

A

Aderley v. Dixon (1824)

81
Q

In what case does it show SP can be used as oppose to damages because C would only be entitled to nominal damages sue to the intervention of a 3rd party?

A
  • Beswick v. Beswick [1968]
82
Q

Beswick v. Beswick [1968]

A
  • C sold his business to D in return for D’s promise to pay an annuity of £5 per week to C’s wife
  • After C’s death, D refused to pay
  • C’s wife sued for SP in the name of the estate (as a matter of law, this is as if C is suing)
  • Damages would have been an inadequate remedy for the estate because they are only payable on one’s personal loss (Not the wife’s)
  • The estate would not actually suffer any pecuniary loss, as the money was payable to W, not the estate
  • It would have been entitled to nominal damages only, which would not have been an adequate remedy
83
Q

Why are damages not adequate for cases where the Subject-matter of the Contract Has a Unique Value?

A
  • Damages can be used where an alternative product can be bought
  • But as these products tend to be unique this is often impossible and therefore through the use of damages the C would only claim nominal damages which would be unfair
84
Q
  • Give an example of something’s with a unique value which would be hard to get damages on?
A
  • Land

- Shares in private companies (not available on the open market)

85
Q

Can shares on the public market be considered unique enough that damages would not be adequate and there is a need to SP?

A
  • Generally cannot be, as there is a clear and obvious alternative, and any additional cost can be compensated by damages.
86
Q

Example of a case where the items where of unique qualities and so damages were not adequate and so the question of specific performance is needed?

A
  • Falcke v. Gray (1859)
87
Q

Falcke v. Gray (1859)

A
  • Contract for sale of 2 antique vases
  • D refused to perform
  • It was held that damages were an inadequate remedy, given the unique nature of the goods
  • SP refused on other grounds
88
Q

Is the inadequacy of damages the main time SP should be used?

A
  • No, as Beswick v. Beswick showed although it was a factor to be taken into account when considering the use of SP it was not a necessary condition.
89
Q

What is the criticism of the general practise in waiting to see if Damages are inadequate before considering the use of SP?

A
  • C is the innocent party, so she should be entitled to choose whichever appropriate remedy she wants.
90
Q

Is SP a discretionary factor?

A
  • Yes
  • BUT the award of SP has been built up over a number of years, through a body of precedent, and there are clear rules for their application.
91
Q

What are 10 discretionary factors against the successful use of SP?

A

1 -Equity (EQ) will not assist a volunteer.
2- He who seeks EQ must come with clean hands.
3- Delay defeats EQ.
4- Contracts for personal services.
5- Performance of a continuing activity.
6- Impossibility.
7- Undue hardship.
8- Lack of mutuality.
9- Uncertainty and problems of supervision.
10- Waste.

92
Q

If C has not given consideration will they be entitled to SP?

A
  • NO

- Therefore if C is a volunteer SP is not available

93
Q

what is meant by Equity (EQ) will not assist a volunteer. and which case can be used?

A
  • if C has not given consideration, she will not be entitled to SP and a mere volunteer has no consideration
  • Cannon v. Hartley [1949]
94
Q

Cannon v. Hartley [1949]

A
  • D covenanted by deed to settle property on trust for C
  • D refused to perform covenant and C sought SP
  • Court refused SP, because C was a mere volunteer
95
Q

What is meant by He Who Comes to EQ Must Come w/clean Hands ans which case can be used?

A
  • If there has been some “unfairness” in C’s conduct in procuring or performing (or not performing) the contract, she will not be entitled to SP.
  • Any “unfairness” to D NOT caused by C’s conduct should not be relevant under this discretionary ground.
  • Quadrant Visual v. Hutchinson Telephone [1993]
96
Q

Webster v. Cecil (1861)

A
  • D mistakenly offered to sell land to C for £1150, intending to sell for £2150
  • No suggestion C knew of or in any way induced mistake
  • However, court refused C’s application for SP on basis that D had clearly proven his mistake
  • C had not in any way caused D’s mistake
  • Indeed, C did not know of D’s mistake
  • The only “unfairness” to D was caused by his, D’s, own mistake
  • Yet some treat this as an example of C’s unclean hands
97
Q

Quadrant Visual v. Hutchinson Telephone [1993]

A
  • C contracted to sell a mobile phone business to D
  • Part of the price was to be calculated by reference to the number of customers the business had in a set period prior to the completion date, with a higher price being payable the more customers the business had had in that period
  • W/out disclosing it to D, C entered into a promotion to give away free phones, artificially increasing the number of customers to drive up the contract price
  • C was denied SP due to unclean hands
98
Q

Why could Webster v. Cecil (1861) be deemed unfair?

A
  • It was judged that C had unclean hands and so could not claim sp yet C had no idea that the price given by D was a mistake
  • goes against the doctrine in SP that says that Any “unfairness” to D NOT caused by C’s conduct should not be relevant under this discretionary ground.
99
Q

Why is SP not allowed if Delay defeats EQ?

A
  • If C unreasonably delays in seeking SP, this will weigh against her claim for SP.
  • what is an unreasonable delay depends upon the facts of the case.
100
Q

Why is SP not allowed for Contracts for Personal Services and a case to demonstrate this?

A
  • An order for SP compelling D to perform personal services to C would be akin to slavery, albeit slavery for a wage.
  • De Francesco v. Barnum (1890)
  • Similarly, if an employer no longer has any confidence in the employee, it would be untenable to force the former to provide the latter w/work.
101
Q

De Francesco v. Barnum (1890)

A
  • D entered into a stage-dancing apprenticeship contract w/C
  • D (the dancer) breached and C sought SP
  • SP was refused, because it would have required compelling D to perform personal services
102
Q

Why is SP not allowed for Performance of a Continuing Activity and a case to demonstrate this?

A
  • Courts will be reluctant to make an order for SP compelling D to carry on a continuing (rather than one-off) activity, even if that activity does not require the provision of personal services to C.
  • As It will often be hard to ensure enforcement of the order, as the parties may disagree as to whether D is properly performing a continuing activity.
  • AND It is inappropriate to compel D to perform a continuing act under threat of conviction for contempt of court
  • Co-operative Insurance v. Argyll [1998]
103
Q

Co-operative Insurance v. Argyll [1998]

A
  • C leased space in a retail park to D, from which D ran supermarket
  • Under the lease, D promised to continue its trade on the premises during the whole 35-year period of the lease
  • However, D decided to close a number of its stores, including the one in C’s retail park, due to heavy losses
  • C sought an order for SP compelling D to carry on business, at least until a suitable replacement tenant could be found
  • However, HL, overturning the decision of CA, refused the order for SP, on the two grounds
  • As It will often be hard to ensure enforcement of the order, as the parties may disagree as to whether D is properly performing a continuing activity.
  • AND It is inappropriate to compel D to perform a continuing act under threat of conviction for contempt of court
104
Q

Why is SP not allowed for Impossibility and a case to demonstrate this?

A
  • it would be inappropriate to grant SP if it would be impossible for D to perform.
  • Castle v. Wilkinson (1869)
105
Q

Castle v. Wilkinson (1869)

A
  • D and his wife contracted w/C to sell W’s share in land to C
  • W refused to perform and C sought SP as against D
  • D could not compel W to perform, nor effect the sale by any other means, so SP could not be granted against him
  • SP cannot be granted due to impossibility to perform
106
Q

Why is SP not allowed for undue hardship and a case to demonstrate this?

A
  • If an order for SP would cause undue hardship to D, the court has discretion to refuse to make the order.
  • Note that it is of course not enough for D simply to prove that the contract has turned out to be a bad bargain for him.
  • Patel v. Ali [1984]
107
Q

Patel v. Ali [1984]

A
  • D contracted to sell a house to C
  • The parties exchanged contracts but D did not complete on the set date
  • C sought SP
  • Court refused on the basis of the hardship that would be caused to D
  • Since concluding the contract, D had been diagnosed w/bone cancer and had one of her legs amputated
  • Her husband had been adjudicated bankrupt and subsequently imprisoned
  • D depended on her neighbours for everyday care; if she had to move away, she might not be near enough for them to provide such necessary care
  • An order for SP was refused
  • C also delayed to seek SP which contributed to decision
108
Q

Why is SP not allowed for Lack of mutuality and a case to demonstrate this?

A

.- SP will not be available to C if she has any unperformed obligations in relation to which SP could not be granted against her,

  • Unless damages for non-performance would be an adequate remedy for D (in which case, SP can still be granted
  • Price v. Strange [1978]
109
Q

Price v. Strange [1978]

A
  • D agreed to grant a new lease to C in return for C performing repair work to D’s property
  • D refused to perform and C sought SP
  • D argued that C could not be awarded SP because SP could not be awarded against C, as C’s obligations were for the provision of personal services to D
  • CA, however, rejected this argument
  • Even if SP could not be granted against C, it could still be awarded against D if (as here) damages would be an adequate remedy for D should C default
  • Damages would be an adequate remedy because if D, for example, had to hire someone else to effect the repairs and this, he could be awarded damages to compensate this loss
110
Q

Why is SP not allowed for uncertainty and a case to demonstrate this?

A
  • If D’s obligation is uncertain (although, not to such a degree as to preclude formation of the contract), this may be a ground for refusing SP
  • on the basis that it would be impossible properly to enforce the order because it could not be determined whether or not D had breached it.
  • Co-operative Insurance v. Argyll [1998]
111
Q

Co-operative Insurance v. Argyll [1998]

A
  • C seeking order for SP compelling D to carry on the business of a supermarket
  • One of the grounds for refusing SP here was that it would have been hard to determine whether D was properly conducting the business on the site
112
Q

Why is SP not allowed for waste and a case to demonstrate this?

A
  • Where an order for SP would be severely economically inefficient, because it would involve D incurring costs far outweighing any benefit that would be provided to C, this is a factor militating against an award of SP.
  • Wrotham Park v. Parkside Homes [1974]
113
Q

Wrotham Park v. Parkside Homes [1974]

A
  • D contracted w/C not to build on certain land w/out approval of C
  • In breach, D built on the land
  • C sought a mandatory injunction compelling D to demolish the buildings
  • Court refused, because it would have been ‘an unpardonable waste of much-needed houses’

Contract Law 2 (15 decks)

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