Remedies (All)

Question 1

Compensatory damages definition

Answer 1

• C must prove that the damage was caused by the D’s breach. Damages are meant to place the claimant in the same position as they were if the contract had been performed

Question 2

Explain test for compensatory damages

Answer 2

1- Loss that is a natural consequence of the breach- objective test
2- Did the parties have specific knowledge of any potential losses when the contract was made- subjective test (Victoria Laundry vs Newman industries Ltd)
-Application= always apply test 1, and only apply test 2 if relevant

Question 3

List/ explain the different categories of recoverable loss

Answer 3

-Loss of a bargain- this includes the profits that C would have expected to receive had the contract had been performed. You can claim for the loss of chance- (Chaplin vs Hicks)
- Reliance loss- This is wasted expenditure by a claimant who relied on a contract being performed. They are expenses spent in advance of a contract.
- Liquidated damages- Where the amount of damages has been fixed by a term in the contract. However, the sum identified in the contract must represent an accurate and proper assessment of loss and not be exorbitant.

Question 4

Compensatory damages side rule

Answer 4

• The duty to mitigate the loss:
  -The injured party must take reasonable steps to minimise the effects of the breach. This is the mitigation of loss. However, a claimant is not bound to go to extraordinary lengths to mitigate the loss, only to do what is reasonable in the circumstances.

Question 5

Equitable remedies- introduction/ definition

Answer 5

• Equitable remedies are awarded where damages is an inadequate remedy and justice would not be served merely by damages. Equitable remedies are available at the courts discretion.

Question 6

Explain the equitable remedy- injunctions

Answer 6

• An injunction is a court order telling you to stop doing something or forcing you to do something. An injunction is only awarded if damages would not have been enough and it is in the public interest (Miller vs Jackson). An injunction can also be tailored to meet the needs of the situation (Kennaway vs Thompson)

Question 7

Explain the equitable remedy- specific performance

Answer 7

• This is ordering one party to performs his or her contractual obligations
• You cannot claim this remedy if damages would be adequate or in contracts for personal services (Page One Records vs Britton)
• Specific performance will not be granted if it would lead to unfair hardship on the C (Patel vs Ali)

Question 8

Explain the equitable remedy- Restitution

Answer 8

• This is simply the repayment of any money or other benefits passed to the defendant in advance of the contract that is breached.

Question 9

Explain the equitable remedy- Rescission

Answer 9

• The idea of rescission means that the parties are returned to the positions they wee in before the contract was made. it is then as if the contract was never made. However you cannot claim rescission if it is impossible to return the parties back to their original position.