LAWS105 Lecture Notes - Lecture 11: Contributory Negligence, Supreme Court Act, Specific Performance
LAWS105 – CONTRACT LAW
Wk. 11 – Remedies: Damages and Liquidated Claims and Equitable Remedies
Compensatory Damages
Damages for breach of contract are compensatory in nature
Aim is to place the plaintiff in the position they would have been in had the
contract been performed.
Idea is that the damages are a substitute for performance
Robinson v Harman affirmed in Clark v Macourt 2013 HCA 56
Aim is not to punish the defendant for their breach.
Preconditions for Damages
Preconditions for a plaintiff to be awarded damages for breach of contract:
That the plaintiff suffered loss
A casual connection between the defendant’s breach of contract
That the loss suffered is not too remote from the breach of contract
That the loss suffered is of a kind recognized by the law
Where loss cannot be proved – the plaintiff is only entitled to recover nominal
damages
Where calculation of loss in impossible
Where the extent of a breach itself cannot be demonstrated – calculation of
loss is impossible, and the plaintiff will be entitles to receive only nominal
damages.
Luna Park NSW Ltd V Tramways Advertising Pty Ltd 1938 61 CLR 286
Losses by a third party
A plaintiff can only recover loss suffered by them personally.
If the loss is suffered by a third party to the contract as a result of the
defendant’s breach of contract – damages generally cannot be recovered by
the plaintiff
BUT – there are exceptional circumstances: Linden Gardens Trust Ltd v
Lenesta Sludge Disposals Ltd [1994] 1 AC 85 House of Lords.
Causation
Plaintiff must prove that its loss was caused by the defendant’s breach of
contract
What if the loss can be attributed to more than one cause?
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Plaintiff must prove the defendant’s breach was at least one of the causes of
the loss suffered
That the defendant could foresee that the loss would arise as a result of its
breach.
Reg Glass Pty Ltd v Rivers Locking Systems Pty Ltd (1968) 120 CLR 516
Types of Loss Recognised
Some forms of compensable loss at common law arises from breach of contract
include:
Mental distress
Damages for mental distress may be recovered IF the object of the
contract is:
To provide enjoyment or relaxation (HC judgement in Baltic Shipping)
or
The prevention of vexation or anxiety (UK cases)
Baltic Shipping v Dillon 1993 176 CLR 344
Loss of chance
The loss of chance of gaining some benefit under a contract due to the
defendants breach can give rise to damages
In determining the loss the court will reconsider the prospect of
success of the lost opportunity
Wasted expenditure – reliance damage
If P has expended money which is wasted as a result of D’s breach,
and P would have recuperated this expense has the contract been
performed
Cost of repairs
Usual case = defective performance by tradesman
General rule = D can recover the amount necessary to put it in the
position it would have been in position it would have been in had the work
been performed properly – (provided that action is reasonable)
Loss of the use of money
Loss is the form of costs associated with borrowing / or / through the
oss of interest is recoverable IF the loss is foreseeable
Hungerfords v Walker 1989 171 CLR 125
Assessment of Damages
In assessing damages, it is necessary to consider:
The date for assessment of damages
Mitigation of loss
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
11 remedies: damages and liquidated claims and equitable remedies. Damages for breach of contract are compensatory in nature. Aim is to place the plaintiff in the position they would have been in had the contract been performed. Idea is that the damages are a substitute for performance. Robinson v harman affirmed in clark v macourt 2013 hca 56. Aim is not to punish the defendant for their breach. Preconditions for a plaintiff to be awarded damages for breach of contract: A casual connection between the defendant"s breach of contract. That the loss suffered is not too remote from the breach of contract. That the loss suffered is of a kind recognized by the law. Where loss cannot be proved the plaintiff is only entitled to recover nominal damages. Where the extent of a breach itself cannot be demonstrated calculation of loss is impossible, and the plaintiff will be entitles to receive only nominal damages.
