Remedies for Breach of Contract

• Pages: 260-276

CHAPTER 14

REMEDIES FOR BREACH OF CONTRACT

The appropriate remedy for a particular breach of contract will depend on the subject

matter of the contract and the nature of the breach. In some cases, more than one

remedy may be available. In all cases, the claimant must state in his pleadings the

remedy or remedies he is seeking. The possible remedies are:

(a) Action for unliquidated damages.

(b) Action for liquidated damages.

(c) Action for damages by way of recovery of a specifi c sum of money owed under

a contract, for example for the agreed price of goods or services under sale of

goods legislation.

1

(d) Action for a reasonable price for goods sold, under sale of goods legislation,

where the price is not fi xed by the contract.

2

(e) Action on a quantum meruit.

(f) Action for specifi c performance.

(g) Action for an injunction to restrain breach of a negative term in a contract.

UNLIQUIDATED DAMAGES

The purpose of an award of unliquidated damages is primarily to compensate the

claimant for the defendant’s breach of contract. Such damages are thus known as

‘compensatory’. The court may award substantial damages, which are intended to

place the claimant in the position he would have been in, had the contract been

performed by the defendant, or nominal damages, that is, a small ‘token’ award in

cases where the defendant is technically in breach but the claimant has suffered no

actual loss.

Exemplary (punitive) damages are sometimes available in tort claims, but never

for breach of contract.

3

Measure of damages

Compensatory damages in contract claims are most often referable to fi nancial loss,

but they may also include physical damage to the claimant’s person or property (for

example, where a defective product causes personal injury to a consumer), the loss

of comfort or privacy, and (in limited circumstances) inconvenience and mental

distress. The purpose of compensatory damages in a claim for breach of contract

is to put the claimant in the position he would have been in had the contract

been performed properly. Thus, for instance, in a construction contract where the

1 Section 48, Sale of Goods Act (Jamaica); s 49, Sale of Goods Act, Ch 337 (The Bahamas); and s 49,

Sale of Goods Act, Cap 393 (Antigua and Barbuda).

2 Section 9, Sale of Goods Act (Jamaica); s 10, Sale of Goods Act, Ch 337 (The Bahamas); and s 10, Sale

of Goods Act, Cap 393 (Antigua and Barbuda).

3 Addis v Gramophone Co Ltd [1909] AC 488.

Chapter 14: Remedies for Breach of Contract 261

contractor has produced a defective building, the measure of damages is the cost of

repair or reinstatement;

4 in a contract for the sale of goods, if the seller fails to deliver,

the buyer’s damages will be equivalent to the difference between the market price

for goods of that description and the contract price on the day fi xed for delivery;

5

and where the goods which the seller fails to deliver are not readily available on the

market, the proper measure of damages is the profi t the buyer would have made on

a resale, if the contract had been carried out.

6 Where the buyer fails to take delivery,

the seller may recover as damages the difference between the contract price and the

market price at the time when the goods ought to have been accepted;

7 and where

the seller is a dealer in the particular goods sold and, as a result of the buyer’s non-

acceptance, he has lost a profi t on the sale, he is entitled to be compensated for that

loss, even if he has (or could have) succeeded in fi nding another buyer, for he will

have profi ted from only one sale instead of from two.

8

Damages for mental distress

Damages for mental distress are recoverable by a claimant where such distress is

directly consequential on physical inconvenience caused by a breach of contract; for

example, where a contractor failed to build a house properly, so that it could not be

lived in or rented out, and the owner’s ‘whole existence was affected by having this

unpleasant episode hanging over her head’.

9 Damages for mental distress are also

available in respect of breach of a contract which has as its main purpose the provi-

sion of enjoyment or peace of mind. Thus, in Jarvis v Swans Tours Ltd, 10 the claimant

recovered damages for the disappointment caused to him when a winter sports

holiday in Switzerland, advertised in the defendants’ brochure as a ‘house party’

featuring various entertainments and promising a ‘great time’, utterly failed to live

up to expectations. Other instances of recovery of damages under this head were:

where a fi rm of solicitors failed to obtain appropriate fi nancial relief for the claimant

in matrimonial proceedings;

11 where a cemetery owner, in breach of contract, failed

to provide a burial plot next to the claimants’ parents;

12 and where a newspaper was

in breach of contract by failing to publish an ‘In Memoriam’ to the claimant’s father.

13

4 Vaughn v Odle (1982) High Court, Barbados, No 765 of 1981, unreported [Carilaw BB 1982 HC 44].

5 Section 50, Sale of Goods Act (Jamaica); s 51, Sale of Goods Act, Ch 337 (The Bahamas); and s 50(3),

Sale of Goods Act, Cap 393 (Antigua and Barbuda). Where a seller has delivered goods but the

buyer has lawfully rejected them, the case becomes in effect one of non-delivery, and the measure

of damages is the same as that applicable to non-delivery: McGregor on Damages , 14th edn, para

629; Manning v Neal and Massey Ltd (1982) High Court, Trinidad and Tobago, No 1210 of 1976,

unreported [Carilaw TT 1982 HC 50].

6 Boshali v Misr (Nigeria) Ltd 1967 (1) ALR Comm 260.

7 Section 49, Sale of Goods Act (Jamaica); s 50, Sale of Goods Act, Ch 337 (The Bahamas); and s 50(1),

Sale of Goods Act, Cap 393 (Antigua and Barbuda).

8 Thompson Ltd v Robinson (Gunmakers) Ltd [1955] 1 All ER 154.

9 Harvey-Ellis v Jones (1987) High Court, Barbados, No 931 of 1985, unreported [Carilaw BB 1987 HC 82].

10 [1973] 1 All ER 71. See also Jackson v Horizon Holidays Ltd [1975] 3 All ER 92 (pp 213–215, above)

where the plaintiff contracted with a travel agency for a four-week holiday in Ceylon for himself,

his wife and two young children, in ‘luxurious accommodation’, and what was provided was ‘sub-

standard and downright disgraceful’. It was held that the plaintiff could recover not only for his

own loss and mental distress but also for that suffered by his wife and children.

1 1 Dickinson v James Alexander & Co (1990) 20 FLR 137.

12 Reed v Madon [1989] Ch 408.

13 Eweka v Midwest Newspaper Corp (1976) 6 ECSLR 280.