Damages Flashcards
(13 cards)
What is the general rule on damages?
- Robinson v Harman: Purpose is to put the victim in the same situation they had been had the contract been performed
- Chaplin v Hicks: Key factor is whether the damage was a foreseeable consequence contemplated by the parties
- The Golden Victory: Damages may be reduced where subsequent events known to the court would have reduced the actual loss suffered
- Bunge SSA v Nidera: A supervening event after the date of breach can be taken into account in the assessment of damages
How are damages subject to the rules on remoteness?
- Hadley v Baxendale: Damages should only be considered if they arise naturally or as may have been in the contemplation of both parties
- Victoria Laundry v Newman: Was loss reasonably foreseeable as to result from the breach, based on the defendants knowledge, BUT
- Heron II: This is not the same reasonably foreseeeable as tort. Higher degree of probability is needed to satisfy remoteness
- Parsons v Uttley Ingham: Does not matter the way in which loss happened, so long as the type was foreseeable
What is the test of assumed responsibility?
The Achilleas
* Defendant is only liable for loss which he had assumed responsibility for
* The test is whether the loss was one which was or should have been reasonably contemplated
* Other factors may lead to a conclusion that the parties did not intend for D to be liable
* Consider the nature of the business transaction and background of market expectations
How can damages be reduced by mitigation of loss?
- British Westinghouse Electric v Underground Electric Railway: when C has taken action that diminishes his loss, this can be considered although he was not under a duty to do so
- Globalia Travelling v Fulton Shipping: Essential question is whether there is a sufficiently close link of causation between the benefit and loss
How can damages be reduced by contributory negligence?
- Vesta v Butcher: where a breach of contract also amounts to a breach of tort, the Contributory Negligence Act 1945 may apply
- Barclays Bank v Fairclough: Contributory negligence cannot be a claim to damages on a breach of contractual obligation alone
What is the general rule on non-pecuniary loss?
Addis v Gramophone Co Ltd
* No right to recover damages for injured feelings or loss of reputation
* This case now mainly applies to wrongful dismissal cases
What are the exceptions to the general rule on non-pecuniary loss?
- Farley v Skinner: Damages can be awarded for mental distress even if providing pleasure is not the central object of the contract, so long as it is a major or important object
- Jarvis v Swan Tours: Contract providing entertainment and enjoyment
- Malik v BCCI: Loss of reputation is recoverable where it is caused by the breach and not simply by the manner of breach
What are the rules on damages for cost of reinstatement / cure?
If work contracted for is not performed or is performed badly, the claimant is entitled to the cost of subsitute or remedial work
* Ruxley v Forsyth: This is subject to a reasonableness test of whether the cost is out of proportion to loss suffered. This is subjective to the claimant and particular contract
What are reliance damages?
Loss for any expenses incurred whilst relying upon the contract may be recoverable in damages
* Anglia Television v Reed: expenditure incurred before the contract can be recovered where C relied on the contract in allowing expentidure to be wasted
* Omak Maritime v Mamola Challenger: Such loss is only on the basis that it is presumed to represent his expectation loss, cannot put him in a better position. Reliance interest is merely a species of expectation interest and thus a claim for reliance loss is not available if the contract was unprofitable
When will gain based damages be awarded?
Attorney-General v Blake: If ordinary damages would be inadequate for the breach and A has a legitimate interest in seeking to prevent the kind of behaviour that resulted in B making his gain, an account of profits can be given
* Remedy will usually work to strip a contract breaker of the gains they made as a result of their breach, or the court might determine a reasonable sum instead
When will a loss of chance be recoverable as damages?
- Chaplin v Hicks: Loss of chance to participate in a beauty contest recoverable, did not have to demonstrate you would be successful
- Allied Maples Group v Simmons & Simmons: C must show a real and substantial chance of getting the benefit. If the chance depends on what C would have done without the breach, they must show on the balance of probability they would have taken that path
What is the test for deciding whether a term for liquidated damages amounts to a penalty?
Cavendish v El Makdessi
Is the provision a secondary obligation which imposes a detriment out of proportion to any legitimate interest of the innocent party?
When will negotiating damages be awarded?
Negotiating damages are the hypothetical fee the defendant would have paid the claimant for the right to breach the contractual restriction
* Morris Garner v One Step: These are only available where the contractual right that was breached can be properly viewed as an asset
