Beruflich Dokumente
Kultur Dokumente
Remedies
(Sweeney & OReilly 2nd Ed. Chapter 9 pp 245 257 and pp 279 - 283)
Types of Remedy
Termination Rescission Recovery of Contract Price Damages Equitable Remedies Specific Performance Injunction Rectification Restitution
Termination of a contract
A contract can be brought to an end by: 1. Performance 2. Agreement 3. A Term of the Contract 4. Frustration 5. Breach 6. Operation of Law
Termination by Performance
Where the parties wholly or substantially perform their obligations under the contract, the contract is discharged Hoenig v Isaacs (S&OR p269)
Termination by Agreement
Parties to the contract agree to discharge their obligations to one another This latter agreement will only be binding if: There is consideration; or Promissory estoppel arises The contract to terminate the earlier contract is subject to usual contractual rules e.g. economic duress
Termination by Frustration
Where: An intervening event; Not contemplated by the parties; Makes performance impossible; or Radically different to that originally contemplated.
Termination by Breach
Breach of a condition, or a serious breach of an intermediate term, will allow termination
Condition Intermediate Term
Warranty
If Serious
Not Serious
Damages Only
Termination by Operation of Law Bankruptcy Cooling Off Periods (e.g. Sale of Land)
Rescission
Available for: Misrepresentation Undue influence Unconscionable conduct Duress
Rescission (cont.)
Effect Contract is terminated ab initio (i.e. it is as though there never was a contract) Compared to Termination (e.g. for breach) Termination only cancels the contract from the point of termination Procedure Innocent party rescinds by giving notice to the other party
Rescission (cont.)
Not possible if: Contract has been affirmed by innocent party parties cannot be restored to substantially the same position they were in prior to the contract (restitution)
Damages
Every breach of a contract gives a right to damages The object of damages is to compensate for loss actually suffered not to punish
Addis v Gramaphone Co Ltd (S&OR p270)
Agreed Damages
The contract may provide for agreed damages Saves an expensive assessment of damages by a court Agreed damages must be a genuine preestimate of damages Courts will not enforce a penalty
Mitigation of Damages
Plaintiff has a duty to mitigate losses Cannot claim losses which could have been reduced or avoided by the taking of reasonable steps
Remoteness of Damage
Damages must not be too remote
Such losses as may fairly and reasonably be considered either arising naturally, i.e. according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties at the time the contract was made, as the probable result of the breach of it - Hadley v Baxendale (S&OR p272)
Losses within the actual contemplation of the parties at the time the contract was made
Victoria Laundry v Newman Industries (S&OR p274)
Calculating Damages
The amount of damages should place the innocent party in the same position that he would have been in had the contract been properly performed The court cannot refuse to award damages just because they are difficult to calculate Damages can include
Expectation loses Personal injuries Disappointment, distress and discomfort
Expectation Losses
If there is a market for the goods then the expectation losses will be the difference between the market price and the contract price If there is no market then specific performance is a better option
Equitable Remedies
Specific Performance Court orders a party to carry out their contractual obligations Only available if an order for damages would not be an adequate remedy Usually restricted to sale of land Never awarded to enforce a contract for the provision of personal services