Business Law - Remedies

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CONTRACT – REMEDIES (Pg 183)

Damages

|Damages is the principal common law remedy for a breach of contract. It refers to the monetary compensation payable by the defaulting party. | |Assessment |Aim of unliquidated damages | | |The general principle of assessment is that the injured party is to be placed in the same financial position he would be in if the | | |contract had been properly performed. The award of damages is calculated on the benefit which would accrue to the injured party and not | | |on the cost of performing the obligation by the defaulting party. | | | | | |Expectation Loss (loss of profit) and Reliance Loss (wasted expenditure) | | |Anglia Television Ltd v Reed (1970) – The court held that Anglia Television was entitled to recover damages regardless of whether the | | |expenditure (reliance loss) was incurred before or after the contract was entered into with Reed. Cullinane v British “Rema” | | |Manufacturing Co Ltd (1954) – case of double recovery rejected. Court held that Cullinane could only claim one of them. | | | | | |Hong Fok Realty Pte Ltd v Bima Investment Pte Ltd (1993) – can either sue for the bargain, (price between the market value and the | | |property at the date of breach) or the wasted expenditure provided they are within the contemplation of the parties. Chaplin v Hicks | | |(1911) – The English Court of Appeal held that although there was no certainty that Chaplin would be among the 12 chosen for employment, | | |she would still be allowed the damages awarded by the jury. | | | | | |Non-pecuniary Losses | | |Courts are generally reluctant to award damages for non-pecuniary losses. But there are some exceptions, ie when the contract has been | | |established to provide comfort, peace of mind, or freedom from distress and it’s breached. Jarvis v Swan Tours Ltd (1973) – The English | | |Court of Appeal held that Jarvis was entitled to damages comprising the cost and the disappointment he suffered. Haron bin Mundir v | | |Singapore Amateur Athletic Association (1992) – the plaintiff was awarded damages, being the amount he would have received from the | | |defendant if he had won medals at the SEA Games. Claim for non-pecuniary losses was rejected. | | | | | |Liquidated Damages and Penalties | | |Generally, the courts will enforce a liquidated damage clause as...
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