Damages Essay:
Introduction - Aims and measure of damages
The overarching aim of damages is to compensate the C for his loss and not punish the D
(Dunlop Tyre). There are comprehensive rules governing how the court will measure the Cs
loss. If the C has not suffered any loss the damages will be nominal only (usually about £5-10).
But it is not worth bringing a claim in these circumstances since in Obagi v Stanborough the C
was ordered to pay the Ds costs. The aim of the court when assessing damages was stated in
Robinson v Harman as ‘the rule at common law is that where a party sustains loss by reason
of breach of contract, he is so far as money can do it, to be placed in the same situation with
respect to damages as if the contract has been performed.’ So the court will try to put the C in
the siaution he would have been in had the contract been properly performed. Refer back to the
question.
● With contracts for services the basic rule is that the amount of damages awarded will be
the cost of putting the work right, which is known as the cost of cure.
● Discuss Ruxley: However the problem with this general rule was addressed In Ruxley
Electronic v Forsyth. In this case the C wanted a swimming pool built on his property at
a depth of seven feet and six inches. When the pool was completed it was only six feet
nine inches so he sued for breach of contract. The court decided that it would be
unreasonbale for the C to insist on reinstatement because the cost of rebuilding the pool
would be out of all proportion to the benefit obtained since he still had a workable
swimming pool that was safe for diving. So instead of awarding the cost of the court he
was awarded £2,500 for loss of amenity.
● Trial judge awarded £2,500 for loss of amenity, CA said this was wrong and should be
cost of cure, HoL upheld trial judge’s decisiom.
● Deicison is good because would have gone against common sense and have been
unreasonable. The C was still better off from the breach because awarded money and
still had workable swimming pool.
● Decision can be criticised since why should the Ds essentially get away with not properly
performing the contract and doing what was agreed.
Other things C can claim for
● Reliance loss damages - in Anglia TV v Reed The D was engaged to play the leading
role in a production for TV but later refused to carry on with the contract. Anglia was
forced to abandon the production as it could not get a substitute. Reliance loss damages
covers expenditure wasted as a result of the breach. The C asked for damages on a
reliance loss basis because the company did not know what profit they would have made
if the contract had been performed properly.
● Damages for lost opportunity - Chaplin v Hicks: C was in the shortlist for auditions but
the organisers failed to tell her the time and place
● Blackpool and Fylde Aero Club: Lost the opportunity to have its tender considered
Introduction - Aims and measure of damages
The overarching aim of damages is to compensate the C for his loss and not punish the D
(Dunlop Tyre). There are comprehensive rules governing how the court will measure the Cs
loss. If the C has not suffered any loss the damages will be nominal only (usually about £5-10).
But it is not worth bringing a claim in these circumstances since in Obagi v Stanborough the C
was ordered to pay the Ds costs. The aim of the court when assessing damages was stated in
Robinson v Harman as ‘the rule at common law is that where a party sustains loss by reason
of breach of contract, he is so far as money can do it, to be placed in the same situation with
respect to damages as if the contract has been performed.’ So the court will try to put the C in
the siaution he would have been in had the contract been properly performed. Refer back to the
question.
● With contracts for services the basic rule is that the amount of damages awarded will be
the cost of putting the work right, which is known as the cost of cure.
● Discuss Ruxley: However the problem with this general rule was addressed In Ruxley
Electronic v Forsyth. In this case the C wanted a swimming pool built on his property at
a depth of seven feet and six inches. When the pool was completed it was only six feet
nine inches so he sued for breach of contract. The court decided that it would be
unreasonbale for the C to insist on reinstatement because the cost of rebuilding the pool
would be out of all proportion to the benefit obtained since he still had a workable
swimming pool that was safe for diving. So instead of awarding the cost of the court he
was awarded £2,500 for loss of amenity.
● Trial judge awarded £2,500 for loss of amenity, CA said this was wrong and should be
cost of cure, HoL upheld trial judge’s decisiom.
● Deicison is good because would have gone against common sense and have been
unreasonable. The C was still better off from the breach because awarded money and
still had workable swimming pool.
● Decision can be criticised since why should the Ds essentially get away with not properly
performing the contract and doing what was agreed.
Other things C can claim for
● Reliance loss damages - in Anglia TV v Reed The D was engaged to play the leading
role in a production for TV but later refused to carry on with the contract. Anglia was
forced to abandon the production as it could not get a substitute. Reliance loss damages
covers expenditure wasted as a result of the breach. The C asked for damages on a
reliance loss basis because the company did not know what profit they would have made
if the contract had been performed properly.
● Damages for lost opportunity - Chaplin v Hicks: C was in the shortlist for auditions but
the organisers failed to tell her the time and place
● Blackpool and Fylde Aero Club: Lost the opportunity to have its tender considered
