24-Remedies

Question 1

What are the different types of remedy in contract law?

Answer 1

1) Legal remedies-damages or remedies for provision of goods etc.
2) Equitable remedies-discretionary
3) Statute remedy-specific remedies defined by statute

Question 2

Nominal damages-definition and case

Answer 2

When no loss is incurred but there is breach.

Staniforth v Lyall (1830)

Facts: D did not load cargo onto boat in agreed time. Case was opened only to prove there was a termination of contract.

Question 3

Staniforth v Lyall (1830)

Answer 3

Nominal damages

Facts: D did not load cargo onto boat in agreed time. Case was opened only to prove there was a termination of contract.

Question 4

What are ‘Wrotham Park’ damages?

Answer 4

From the case of Wrotham Park v Parkside Homes (1974)

Damages awarded when C hasn’t necessarily incurred a loss but the court awards C more than nominal damages.

Question 5

Wrotham Park v Parkside Homes (1974)

Answer 5

Established ‘Wrotham Park’ damages.

Facts: Without C permission D built houses on C land-courts awarded damages equal to what C would reasonably have accepted for D to build on their land.

Question 6

What case established ‘Wrotham Park’ damages?

Answer 6

Wrotham Park v Parkside Homes (1974)

Facts: Without C permission D built houses on C land-courts awarded damages equal to what C would reasonably have accepted for D to build on their land.

Question 7

What is it called when a court awards C damages that are more than nominal even if C hasn’t necessarily incurred a loss?

Answer 7

Wrotham Park damages

Question 8

What case demonstrates speculative damages awarded for loss of chance?

Answer 8

Chaplin v Hicks (1911)

Facts: C was deprived of opportunity to take part in beauty contest and subsequent role as an actor due to a breach of contract. 12 out of 50 contestants were given work (24%) therefore C was awarded damages for missing out on a 24% chance of employment.

Question 9

Chaplin v Hicks (1911)

Answer 9

Demonstrates speculative damages awarded for loss of chance.

Facts: C was deprived of opportunity to take part in beauty contest and subsequent role as an actor due to a breach of contract. 12 out of 50 contestants were given work (24%) therefore C was awarded damages for missing out on a 24% chance of employment.

Question 10

What case demonstrates speculative damages awarded for loss of pleasurable amenity?

Answer 10

Ruxley Electronics v Forsyth (1996)

Facts: Swimming pool was built 10% more shallow than C asked-cost of fix was equal to original pool construction cost and therefore unsuitable-speculative damages awarded for loss of pleasurable amenity instead.

Question 11

Ruxley Electronics v Forsyth (1996)

Answer 11

Speculative damages for loss of pleasurable amenity.

Facts: Swimming pool was built 10% more shallow than C asked-cost of fix was equal to original pool construction cost and therefore unsuitable-speculative damages awarded for loss of pleasurable amenity instead.

Question 12

Which case set out the test for ‘remoteness’ in contract of law?

Answer 12

Hadley v Baxendale (1854)

Facts: Mill owner ordered crankshaft for his mill needed it urgently but did not tell the carrier it was urgent-C unsuccessfully tried to claim for this but carrier was unaware of the urgency to which it was needed so no claim allowed.

Question 13

Hadley v Baxendale (1854)

Answer 13

Test for remoteness.

Facts: Mill owner ordered crankshaft for his mill needed it urgently but did not tell the carrier it was urgent-C unsuccessfully tried to claim for this but carrier was unaware of the urgency to which it was needed so no claim allowed.

Question 14

What are the two parts to a test of remoteness in contract law?

Answer 14

1) Objective-what loss is a natural consequence of the breach?
2) Subjective-was such a loss foreseeable by any party to the contract?

Question 15

What case further developed the test of remoteness in contract law?

Answer 15

Victoria Laundry v Newman Industries (1949)

Facts: Laundrette successfully sued for late delivery of essential boiler for regular business however failed for a second claim for loss of a special client which was unknown to D.

Question 16

Victoria Laundry v Newman Industries (1949)

Regarding what test?

Answer 16

Further developed the test of remoteness.

Facts: Laundrette successfully sued for late delivery of essential boiler for regular business however failed for a second claim for loss of a special client which was unknown to D.

Question 17

What case demonstrates that knowledge can be implied on basis of what reasonable person would have contemplated given the circumstances?

Answer 17

The Heron 2 (1969)

Facts: D was transporting cargo of sugar for C that arrived late which caused a loss of profit due to fluctuations in the price of sugar-D must have known that late delivery could affect C profits.

Question 18

The Heron 2 (1969)

Answer 18

Knowledge based on what reasonable person wold have contemplated given the circumstances.

Facts: D was transporting cargo of sugar for C that arrived late which caused a loss of profit due to fluctuations in the price of sugar-D must have known that late delivery could affect C profits.

Question 19

What case is an example of recoverable losses based on the difference between the goods/services required and what is actually provided?

Answer 19

Bence Graphics v Fasson UK (1996)

Facts: Vinyl film provided by D did not last the stated 5 years but only 2-C entitled to claim for recovery of losses incurred in correcting the issue.

Question 20

Bence Graphics v Fasson UK (1996)

Answer 20

Recoverable losses based on the difference between goods/services required and what is actually provided.

Facts: Vinyl film provided by D did not last the stated 5 years but only 2-C entitled to claim for recovery of losses incurred in correcting the issue.

Question 21

What cases demonstrate that where there is a market or lack thereof, damages will be the difference between contract price and market price?

Answer 21

1) Charter v Sullivan (1957)-High market demand-nominal damages.
2) Thompson Ltd v Robinson Gunmakers (1955)-Low demand-therefore damages for loss of profit.

Question 22

What case demonstrates that for recoverable loss, if there is high enough demand for a product there may not necessarily be a claim for loss of profit on a cancelled order?

Answer 22

Charter v Sullivan (1957)

Facts: Hillman Minx cars were in higher demand than there were available, therefore finding a substitute buyer was easy-only nominal damages awarded.

Question 23

Charter v Sullivan (1957)

Answer 23

For recoverable loss, if there is high enough demand for a product there may not necessarily be a claim for loss of profit on a cancelled order?

Facts: Hillman Minx cars were in higher demand than there were available, therefore finding a substitute buyer was easy-only nominal damages awarded.

Question 24

What case demonstrates that if there is low or no market for a product and a substitute seller is hard to find in event of a cancelled order-then C may be entitled to damages for loss of profit?

Answer 24

Thompson Ltd v Robinson Gunmakers (1955)

Facts: Supply of Vanguard Standard cars outstripped demand therefore loss of profit occurred when D cancelled their order-damages awarded for loss of profit.

Question 25

Thompson Ltd v Robinson Gunmakers (1955)

Answer 25

If there is low or no market for a product and a substitute seller is hard to find in event of a cancelled order-then C may be entitled to damages for loss of profit?

Facts: Supply of Vanguard Standard cars outstripped demand therefore loss of profit occurred when D cancelled their order-damages awarded for loss of profit.

Question 26

Types of recoverable loss based on loss of a bargain?

Answer 26

1) Difference in cost of contract and actual goods provided-Bence Graphics v Fasson UK ltd (1996)

2) Difference between market value and price paid-Charter v Sullivan (1957)
Thompson Ltd v Robinson Gunmakers (1955)

3) Loss of profit that would have been made-Victoria Laundry v Newman (1949)
4) Loss of chance-Chaplin v Hicks (1911)

Question 27

What case demonstrates recoverable losses for loss of future profit due to breach of D?

Answer 27

Victoria Laundry v Newman (1949)

Facts: Delay in delivering a boiler lead laundrette to lose out on profit.

Question 28

Victoria Laundry v Newman (1949)

Regarding damages?

Answer 28

Recoverable losses due to loss of future profit.

Facts: Delay in delivering a boiler lead laundrette to lose out on profit.

Question 29

What case to show recoverable losses for loss of chance?

Answer 29

Chaplin v Hicks (1911)

Facts: Actress missed out on chance to audition due to a breach of contract-claimed for loss of potential earnings. (not usually afforded in contract law-more negligence this case is an exception)

Question 30

Chaplin v Hicks (1911)

Regarding damages?

Answer 30

Recoverable losses for a loss of chance.

Facts: Actress missed out on chance to audition due to a breach of contract-claimed for loss of potential earnings. (not usually afforded in contract law-more negligence this case is an exception)

Question 31

What is reliance loss?

Example case?

Answer 31

Expenses incurred by a C who relied on a contract being performed. (like pre-contractual admin)

Anglia TV v Reed (1972)

Facts: Reed agreed to be main actor but withdrew-suitable placement could not be found-C claimed for loss of potential earnings and for expenses incurred before contract.

Question 32

Expenses incurred by a C who relied on a contract being performed.

This is called?

Example case?

Answer 32

Reliance loss.

Anglia TV v Reed (1972)

Facts: Reed agreed to be main actor but withdrew-suitable placement could not be found-C claimed for loss of potential earnings and for expenses incurred before contract.

Question 33

Restitution definition

Answer 33

Money paid to D in advance of contract is simply returned.

Question 34

Money paid to D in advance of contract is simply returned.

Answer 34

Restitution

Question 35

What case demonstrates C should mitigate the loss?

Answer 35

Westinghouse v Underground Electric Railways (1912)

Facts: C bought goods to replace the defective goods delivered by D-they were more efficient-this was considered mitigation of loss and altered damages owed accordingly.

Question 36

Westinghouse v Underground Electric Railways (1912)

Answer 36

C duty to mitigate the loss.

Facts: C bought goods to replace the defective goods delivered by D-they were more efficient-this was considered mitigation of loss and altered damages owed accordingly.

Question 37

What is the case for liquidated damages?

Answer 37

Dunlop Tyres v New Garage (1914)

Facts: Term in contract said that if New Garage sold tyres for less than retail there would be a fee per tyre. Clause was for liquidated damage and not a penalty clause.

Question 38

Dunlop Tyres v New Garage (1914)

Answer 38

Liquidated damages as a pose to penalty fee.

Facts: Term in contract said that if New Garage sold tyres for less than retail there would be a fee per tyre. Clause was for liquidated damage and not a penalty clause.

Question 39

What is the modern case for showing a penalty?

How does it set out a penalty?

Answer 39

Cavendish Square v Talal Makdessi (2015)

A penalty is non-exaggerated amount and to protect legitimate interest of party.

Facts: Middle Eastern media business for sale. Term in contract meant seller could not compete with buyer under threat of forced sale of shares at reduced price.

Question 40

Cavendish Square v Talal Makdessi (2015)

Answer 40

A penalty is a non-exaggerated amount and to protect the legitimate interests of the party

Facts: Middle Eastern media business for sale. Term in contract meant seller could not compete with buyer under threat of forced sale of shares at reduced price.

Question 41

What case shows that equitable remedies are not available for contracts of personal service and employment?

Answer 41

Page One Records v Britton (1967)

Facts: A music band agreed Page One would be their manager with a clause that they would not employ a new manager for 5 years-relationship broke down and they wanted a new manager and Page One’s attempts to put an injunction on this failed.

Question 42

Page One Records v Britton (1967)

Answer 42

Equitable remedies are not available for contracts of personal service or employment.

Facts: A music band agreed Page One would be their manager with a clause that they would not employ a new manager for 5 years-relationship broke down and they wanted a new manager and Page One’s attempts to put an injunction on this failed.

Question 43

What case shows that equitable remedy of specific performance is not available where doing so would make a party bankrupt?

Answer 43

Airport Industrial v Heathrow Airport (2015)

Facts: Tenant was contractually obliged to build a car park but couldn’t do it to C’s standards because it would lead to liquidation-court could not enforce specific performance as this was seen as unjust.

Question 44

Airport Industrial v Heathrow Airport (2015)

Answer 44

Equitable remedy of specific performance not available where doing so would make a party bankrupt.

Facts: Tenant was contractually obliged to build a car park but couldn’t do it to C’s standards because it would lead to liquidation-court could not enforce specific performance as this was seen as unjust.

Question 45

In what circumstances are equitable remedies not usually awarded?

Answer 45

1) Where damages would be an adequate remedy.

2) In contracts for personal services-Page One Record v Britton (1967)

Question 46

What case considers the principle set out in The Heron 2 that of a link between reasonable persons knowledge and contemplation of risk?

Answer 46

Parsons v Ingham (1978)

Facts: Pig nuts that went mouldy and killed pigs-was considered that not airing the nuts was likely to cause harm and was within contemplation of D.

Question 47

Parsons v Ingham (1978)

Answer 47

Principle: further develops principle set out in The Heron 2-what is in contemplation of D.

Facts: Pig nuts that went mouldy and killed pigs-was considered that not airing the nuts was likely to cause harm and was within contemplation of D.

Question 48

What case summarises the law on causation and remoteness of damage in remedies for contract law?

Answer 48

Wellesley Partners v Withers (2015)

Facts: “if at time of making contract, reasonable person would have known damage of that kind would lead to breach”

Question 49

Wellesley Partners v Withers (2015)

Answer 49

Example of: Summarises the current law on causation and remoteness of damage regarding remedies in contract law.

Facts: “if at time of making contract, reasonable person would have known damage of that kind would lead to breach”

Question 50

What are liquidated damages?

Case?

Answer 50

Where amount has been fixed by a term in contract-must be accurate and reflect level of damage.

Dunlop Tyres v New Garage (1914)

Question 51

How does liquidated damage differ from a penalty?

Answer 51

A penalty is unenforceable

because it is seen as an exaggerated sum to deter one party from breaching the contract.