Contract 10 - Remedies Flashcards
What remedies are there for breach of contract?
- Compensatory damages 💵
- Specific Performance 🫵
- Injunction ✋
What is the default approach to damages and 2 ways of calculating it?
Put innocent party in position they would’ve been in had the contract been performed
1. Expectation Interest 👉
2. Reliance Interest 👈
What are the two methods of calculating the damages?
- Expectation used where profit is ascertainable - looks forwards to profit 👉
- Reliance used where profit is uncertain - looks back to costs incurred 👈
What are the different ways of calculating expectation interest 👉
- Cost of Cure: cost of substitute/remedial work required - C must act reasonably 👷♂️💊
- Diminuition in value: difference in value between performance received & performance promised 🏠📉🏚️
- Loss of Amenity: where loss is not in economic value, but still has value to them 💩
What are the cases for calculating the expectation interest:
- Cost of Cure 👷♂️💊
- Diminution of value 🏠📉🏚️
- Loss of amenity 💩
💊 = Defective works
Must act reasonably, knocking down and rebuilding a house is not reasonable for aesthetic issues 🏠💥🏠
(💊&🏠🏚️ often same result)
💩
Cost of rectification out it proportion to benefit obtained.
Pool too shallow, 🏊😭🤫💰
How is expectation interest calculated?
Expected profit + expenses incurred
What is reliance interest and when used?
👈
Putting C in position they would’ve been in had contract never been entered into
- used where expectation damages are highly speculative 🤷♀️
- recover preparation expenses 🤓
- expenses prior to breach 👷💥
What is the reliance interest?
👈
- Used when expectation is highly speculative. 🤷♀️
- Puts back into position would have been. 🔂
- only applies to wasted costs 🗑️
What are the wasted cost requirements for reliance interest?
👈
- C would’ve recouped those expenses had contract been properly performed
💰👀 - D must prove this wouldn’t be the case
🤬💰👀
What’s the case on reliance interest?
👈
⭐️
Star pulled out of film at last minute. Claimed for costs of director even though incurred before contract with star. ✅
🎥💃🤬💰 😎
What’s the case on wasted costs for reliance interest?
👈🗑️
Landlord wrongly terminated mechanic Tenant’s lease early. T tried to sue for their fixed machinery left in the property. As T couldn’t have taken the machinery under the terms of the lease anyway, there was no loss
👷♂️🏭⚙️🎩🤬🤪😭
What losses have special rules and exceptions?
- Mental Distress🤪: damages not awarded unless a major object of contract 📝was to provide pleasure, relaxation & peace of mind 🧘♀️
. - Loss of Reputation😎😭: damages not awarded unless an 🧑🍳 employment contract contains implied term of trust and confidence such that employer must carry out work in honest way 😇
. - Loss of Chance🎲: recoverable in damages if lost chance is quantifiable in monetary terms & there was a real chance opportunity may have come to fruition (gameshow) 🎰
Can damages be recovered on behalf of another?
No
What is a liquidated damages clause?
Stipulates a certain sum payable on particular breach
💥💵
How are liquidated damages clauses interpreted?
Starting point = upheld
Courts intervene will strike it out where it’s a
- penalty clause ⚽️,
AND
- C will be entitled to unliquidated damages 💵