NON-PECUNIARY DAMAGES

Pecuniary damages refers to any financial and material losses sustained

by reason of a breach of contract, such as loss of profits, loss of
earnings. (Expectation Loss or Reliance Loss)

Non-pecuniary damages refers to loss such as pain, loss of amenities ,

physical discomfort, injury to feelings or mental distress and loss of
reputation.
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• The courts are generally not keen /are slow to in awarding non-
pecuniary damages for these reasons:-

• i) difficulty in verifying genuine claims and to prevent floodgates

being opened

• ii) difficulty in assessing and quantifying the damages to be

awarded
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• We have seen in claims for pecuniary damages , where the guiding

principles are that the damages awarded should put the plaintiffs in
the same position (so far as money can do it)as they would have been
in if the contract has been performed
• …..

• The other principle being, plaintiff have to prove his loss.

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• Lord Steyn in Farley v. Skinner ….

• ‘Awards in this case [of non pecuniary damages] should be restrained

and modest. It is important that logical and beneficial developments
in this corner of the law should not contribute to creation of a society
bent on litigation’.
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• Non- pecuniary losses may be recoverable if they are within the

contemplation of the parties to the contract as not unlikely to result
from the breach.
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• Mental distress /Injury to feelings

• The general rule at common law, laid down in Addis V Gramophone, is

that damages for injured feelings cannot be recovered in an action for
breach of contract.

• The House of Lords decision in the above case has been taken to be
authority that damages will not be awarded for injured feelings.
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• In the case of Addis, Plaintiff was employed by the defendants as manager

of their business with a salary and commission on the trade done. He
could be dismissed by six months notice. In October 1905,the defendants
gave him six months notice, but at the same time they appointed his
successor and took steps to prevent the plaintiff from acting any longer as
manager.

• The House of Lords was of the view that despite the wrongful dismissal and
the harsh and humiliating manner in which the plaintiff was treated, there
could be no award of damages for his injured feelings or for the loss that he
may sustain from the fact that the dismissal of itself makes it more difficult
for him to obtain fresh employment
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• After a long period of time, the courts have showed willingness to allow
very clear exceptional situations where damages for mental distress can be
given. (contract is one to provide for enjoyment/entered with aim of
further preventing distress/plaintiff’s distress is the direct consequence
pf physical loss cause by the breach of contract.)

*Damages have been awarded where the subject matter of the contract was
to provide pleasure, peace of mind or sentimental benefit.
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• Awards have been in cases where a wedding photographer failed to

perform his duties

• Where holidays did not meet the represented standard

• Where a solicitor negligently failed to obtain a non-molestation order

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• Damages are awarded for disappointed expectations in a contract to

provide enjoyment. These are cases of holiday contracts.

• Jarvis v Swans Tours Ltd [1973] QB 233, CA

• Abdul Karim v T& R United(S’pore) Pte Ltd
• James Yu v Raffles Hotel Ltd
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• The general rule is that damages for anguish and vexation (mental
distress) are not recoverable in contract unless the object of the
contract was to provide peace of mind or freedom from distress and
accordingly damages are not recoverable for anguish and vexation
arising out of the breach of a purely commercial contract.
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• Read : Subramaniam Paramasivam &Ors v. Malaysian Airlines System

Bhd [2004]1MLJ
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• Loss of credibility , reputation and goodwill

• Under common law, the courts have denied the granting of damages
for loss of credibility and reputation and goodwill in contract cases.

• However, damages for loss of reputation had been granted in specific

instances … cases in which damages for pecuniary loss flowing from
loss of reputation:-
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• 1. the defendant’s breach comprises a refusal to allow an actors

appearance or its breach to publish an author’s book. Here the actor
/author has been held able to recover for the lost of income flowing from
the loss of publicity.
• (where publicity was particularly contemplated by the contract)
• See the case of Marbe v. George Edwards (Daly’s Theatre) Limited & Anor
• 2. the breach of contract comprises the mismanagement of advertising.
• (where defendant fails to include an advertisement in a newspaper,
thereby resulting in loss of business to the plaintiff)
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• 3.where a banker refuses to pay a customer’s cheque where he has

sufficient funds of the customer to meet.
• See Ng Cheng Kiat v. Overseas Union Bank[1984] 2MLJ 140
• 4. actions for breach of a promise to marriage.
• 5.actions where the vendor of real estate, without any fault on the
purchaser’s part, fails to make title.
• 6 the defendant in breach of contract supplies to the plaintiff goods
which are not of the quality sought by the plaintiff’s customers.
• Pecuniary damages are recoverable for loss of goodwill.
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• Read case of Malik v Bank of Credit and Commerce International SA

(in liquidation) [ 1997] 3All ER
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• Physical inconvenience

• In the case of Hobbs and Wife v The London and South Western
Railway Company, where the plaintiff and his family were set down
by the defendant railway company at the wrong station late at night.
They had to walk five miles home in the drizzling rain, in the absence
of available transport or accommodation.
• For this physical inconvenience, Mellor J granted the plaintiff
damages.
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• However, his Lordship explained that the word “inconvenience” is

confined to ‘real physical inconvenience’…..

• ‘For mere inconvenience, such annoyance and loss of temper or

vexation… you cannot recover damages.’
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• Read :

• 1. Watts & Anor v. Morrow

• 2. Farley v. Skinner
• 3.Ruxley Electronics and Construction Ltd v Forsyth, Laddington
Enclosures Ltd.
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• Would you consider awarding non-pecuniary damages for cases of

breach of contract?