Common Law Remedies

Compensation: takes a form of a sum of money

Remedies: set right, protection
Purposes and nature of damages
Damages is a sum of money paid by a defendant once the liability has been
established to put the claimant in the position where they would have been
if the contract was never breached.
The measures or calculation of damages
The purpose is to compensate the claimant instead of punishing or recoup
the gain made by the defendant.
1. Expectation loss: normally compensated by money to put the claimant
back in the same position.
2. Reliance loss: this format is used in tort where there is difficult to
assess where the claimant would have been
Anglia Television V Reed
An actor withdrew the movie, they were reliance loss as it could not be
known whether the project will make a profit or loss so only cost was
compensated.
3. Non-pecuniary loss (loss involving no money)
In these cases, Damages would be awarded for suffering, physical
inconvenience, damage to commercial reputation, and distress.
No compensation for injured feelings as shown in Addis v Gramophone and
confirmed in Johnson v Unisys. But in Jarvis v Swan tours compensation was
given for loss of holiday enjoyment.

Limitations of recovery of damages

 1. Remoteness and causation
Causation is a question of fact in each case. The court decides whether the
breach is the main reason for the loss.
Hadley V Baxendale
A mill owner contracted a crankshaft who didn’t know they had no spare
ones. He was late in delivering, the owner sued for the loss of profit but
failed as crankshaft wasn’t aware of the urgency of the situation.
Damages are only recoverable if:
Can be fairly and reasonably considered as arising from a breach
The parties may reasonably have contemplated the damages at the
time of the contract.
Transfield shipping Inc V Mercator Shipping Inc
One company chartered a ship from the other company for seven months
but delivered it 9 days late. The company asked for $158000 considering it
was the loss they had. The owners wanted the loss to include a $1.36 deal
that they must now renegotiate because of the delay. The court of appeal
held that only the lower amount would be considered a loss.
Victoria Laundry Ltd v Newman Industries
The defendants were contracted to deliver a boiler which they did five
months after the due date. The company sued for the loss and for the loss of
profit on a government contract which they failed as the defendants know
about the government contract.
The heron II
A ship was chartered to carry sugar but was late, the sugar was sold because
the market was going down. They were liable as they could have anticipated
that the market could fluctuate.
The first rule covers loss that a reasonable person could expect. The second
applies where the claimant told the other party about the special
circumstances.
Mitigation
Pilkington V Wood
The claimant bought a house with defective title, claimed against the
solicitor but solicitor argued that the claimant could have brought his action
against the seller. The claim failed.