BLAW1004 Lecture 7: Remedies
12 Jun 2018
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Lecture 7 - Remedies
Remedies for a breach of contract:
• When a breach of contract has occurred, the innocent party is entitled to claim a
remedy.
• Whether or not that remedy is awarded will be determined by the legal principles and
the particular circumstances of the case.
• Common law remedies:
- Termination of the agreement
- Damages to compensate for loss
• Equitable remedies:
- Specific performance
- Injunctions
Choosing a remedy:
• The innocent party can choose what remedy / remedies they seek from the court.
• They can ask for a combination of remedies, or an alternate remedy should the court
not entertain their preferred choice.
• The nature of the contract may impact the remedy that is awarded for failed
performance.
- Example: One off transaction vs. an on-going agreement.
Termination:
• At common law, termination allows the innocent party to:
- (a) Reject the attempted performance; and/or
- (b) Put an end to any further specific performance of outstanding obligations.
• What is terminated is not the contract itself, but the offending party’s right to perform
under it.
• After termination, the unperformed obligations of the defendant must be discharged by
the payment of damages to the extent that the failure to perform has caused loss.
CASES:
• Associated Newspapers v Bancks (1951) 83 CLR 322
- Bancks was a cartoonist who agreed to produce a weekly full – page drawing for
an agreed salary
- Was agreed to be front page
- Appeared on 3rd page → bancks decided to terminate
- Was the agreement to be on front page a condition? → it was → therefore Bancks
was justified in terminating contract
• Tramways Advertising Pty Ltd v Luna Park (NSW) Ltd (1938) 38 SR(NSW) 632
- “If it is a condition that is broken, that is, an essential promise, the innocent party,
when he becomes aware of the breach, had ordinarily the right at his option
whether to treat himself as discharged from the contract and to recover damages
for loss of the contract, or else to keep the contract on foot and recover damages
for the particular breach.
find more resources at oneclass.com
find more resources at oneclass.com
Electing to terminate:
• If a condition of the contract has been breached, the innocent party has the right to
terminate the contract, but they may elect not to do so and keep it on foot.
• If they do elect to terminate, they must communicate this decision to the defaulting
party in an unambiguous manner.
• Once the decision to terminate is made they cannot change their mind.
• The contract itself could also detail what the rights / obligations of the terminating
party are.
CASES:
• Holland v Wiltshire (1954) 90 CLR 409
- Wilshire sold land to Holland for $3750
- Written agreement provided for payment to be made on the day fixed for
settlement (Jan 14th 1952)
- Wiltshire agreed to an extended deadline but Holland failed to meet it
- Holland then informed he did not wish to continue with sale at all
- Contract was not immediately terminated – had until 28th march to pay and then
wiltshire could claim losses
- Decision/reason: could claim loses because two breaches had been made; failure
to meet agreed (extended) time and did not proceed with sale at all → ended up
selling for a lower price → termination of contract due to breach → could claim
the losses (difference in price)
Damages for breach of contract:
• Primary remedy for a breach of contract.
• Award of money to compensate for a loss
• Never punitive in contract.
• Substitute for actual performance.
• Assessed at date of breach.
• Must be established that the breach of contract caused the innocent party to suffer loss.
• Objective: To put the innocent party in the financial position they would have been in
had the contract been properly performed.
CASES:
• Radford v de Froberville (1978) 1 All ER 33
- Radford owned two adjacent blocks of land – sold one to de Froberville on the
condition she build an expensive brick wall
- Failed to build the wall → resold the property to a third party
- Radford sued for damages for breach of contract
- Claimed the cost of actually constructing the wall
- De Frobervilled argued that was only entitled to the difference in value which
was less than the cost
- Radford was entitled to what he claimed as the objective of damages is to put the
non – defaulting party in the position as if they’d received what was promised in
contract → i.e. If wall had of been built
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Damages to compensate for loss: equitable remedies: Example: one off transaction vs. an on-going agreement. Bancks was a cartoonist who agreed to produce a weekly full page drawing for. If it is a condition that is broken, that is, an essential promise, the innocent party, Appeared on 3rd page bancks decided to terminate. If a condition of the contract has been breached, the innocent party has the right to terminate the contract, but they may elect not to do so and keep it on foot. Cases: holland v wiltshire (1954) 90 clr 409. Wilshire sold land to holland for . Written agreement provided for payment to be made on the day fixed for settlement (jan 14th 1952) wiltshire could claim losses. Wiltshire agreed to an extended deadline but holland failed to meet it. Holland then informed he did not wish to continue with sale at all. Contract was not immediately terminated had until 28th march to pay and then.
