Remedies for breach of contract

  • Created by: phoebs.b
  • Created on: 19-04-18 12:41

White and Carter (Councils) Ltd v McGregor (1962) - the claim was an action in debt and there was therefore no duty on the innocent party to mitigate by seeking to minimize the loss suffered. 

McRae v Commonwealth Disposals Commission (1951) - High Court of Australia case. The defendant sold an oil tanker to the plaintiff for £285, said to contain oil and lying at a particular location. The plaintiff fitted out a salvage expedition, but the tanker could not be found. The plaintiff sued for breach and recovery of lost profits on tanker. The defendant alleged common mistake (both thought the tanker existed). It was held that the defendant was in breach of contract since it had promised that the tanker was lying at the location (had taken this risk so not common mistake) but since it as not possible to establish the lost profit on non-existent oil, the plaintiff was limited to recovering the price paid and the cost of the salvage expedition. Where lost profits are too speculative to prove, a claimant may be limited to recovering for wasted expenditure.

British Steel Corporation v Cleveland Bridge & Engineering (1984) - the claimants manufactured steel nodes and delivered them to the defendants. The work had been carried out after the claimants had received a 'letter of intent' from the defendants stating their intention to enter into a contract on their own standard terms and requesting the claimants to start work immediately. Negotiations continued while the work was carried out but the parties were unable to agree on matters such as price, progress payments and liability for loss arising from later delivery. The defendants refused to pay for the nodes on the basis that they had a counterclaim for damages for later delivery, or delivery out of sequence, which exceeded the price. The claimants sued, arguing that, while there was no concluded contract, they had a non-contractual restitutionary claim (a quantum meruit) for the value of the work done. The defendants argued that there was a concluded contract under which they were entitled to damages for late delivery. Robert Goff J held that the claimants' argument was correct: there was no contract and the claimants were entitled in the law of restitution to the reasonable value of their work. 

Beswick v Beswick (1968) - a nephew had acquired his uncle's coal business and in exchange had promised his uncle that he would pay a £5 a week annuity to the uncle's widow on the uncle's death. The nephew failed to pay the widow and she brought an action seeking enforcement in two capacities: (i) in her personal capacity and (ii) as administratrix of her late husband's estate. She faced the privity problem when suing in her personal capacity since she was not a party to the contract containing the nephew's promise, although she was the intended beneficiary of that promise. The House of Lords allowed specific performance in the widow's capacity of administratrix of her husband's estate - so ordering the…


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