Remedies Part II
In this lecture, we consider remedies for
breach of contract other than damages,
namely:
i.
ii.
iii.
iv.
an agreed sum
specific performance
injunctions, and,
quantum meruit.
Agreed sum
An agreed sum usually means that the
claimant is suing for the PRICE of the
contract. It differs from a claim in damages
in that:
i.
there is no need to prove loss, and so
ii. there is no need to worry about
remoteness of damage, nor to
iii. mitigate loss
White and Carter (Councils)
Ltd v McGregor 1962
In the House of Lords it was held that the advertisers
had been entitled to carry out the contract and
could recover the full contract price.
Lord Reid stated that in the case of an anticipatory
breach the innocent party may
either accept the repudiation and sue for damages
or
he may affirm the contract and then sue for an
agreed sum, as the plaintiffs did here.
At common law the position would appear to be
that the debtor only has to pay the actual
price of the contract without interest.
However, this common law position is usually
avoided by either:
i. an express term in the contract stating that
interest will be charged for late payment or
ii. application of the Late Payment of
Commercial Debts (Interests) Act 1998
though this only applies to sale and supply
contracts where both sides are acting ‘in the
course of a business’.
Specific performance
We should remember that ‘damages’ for
breach of contract are the main remedy for
breach of contract. Specific performance is
rare, other than in contracts for the sale of
land.
An order of specific performance is an
equitable, and therefore discretionary remedy,
that compels the actual performance of the
contract.
Specific performance is
only available where
i. damages are not an adequate remedy,
ii. he who comes to equity comes with clean
hands,
iii. the contract is not one for personal services,
iv. the contract would not take a lot of
supervision to enforce, and
v. where the performance to be enforced is
clearly ascertainable.
Beswick v Beswick 1968
It was Lord Reid in the House of Lords
that awarded specific performance to
achieve a ‘just result’ in the
circumstances of the case.
Lord Pearce granted specific
performance because he said it was a
more ‘appropriate’ remedy.
Lord Reid
‘The respondent ‘s second argument is that
she is entitled in her capacity of administratix
of her deceased husband’s estate to enforce
the provision of the agreement for the benefit
of herself in her personal capacity, and that a
proper way of enforcing that provision is to
order specific performance. That would
produce a just result, and, unless there is
some technical objection, I am of opinion that
specific performance ought to be ordered…’
Lord Pearce
‘The present case presents all the features
which led the equity courts to apply their
remedy of specific performance. The contract
was for the sale of a business. The
defendant could on his part clearly have
obtained specific performance of it if Beswick
senior or his adminstratix had defaulted.
Mutuality is a ground in favour of specific
performance.’
Specific performance is also only available on
the basis that
‘he who comes to equity comes with clean
hands’ – one has to remember that specific
performance is an equitable remedy and so
equitable maxims apply. So, the court may
refuse specific performance if it thinks the
claimant’s behaviour has been ‘tricky’ or
‘unfair’.
This equitable point was explored in Quadrant
Visual Communications Ltd v Hutchinson
Telephone (UK) Ltd 1993.
Contracts for personal
services
Page One Records Ltd v Britton 1968
Where the contract does/does
not need a lot of supervision
Ryan v Mutual Tontine Westminster
Chambers Assoc 1893
Posner v Scott-Lewis 1986
Co-operative Insurance Society Ltd v
Argyll Stores (Holdings) Ltd 1997
Where the courts can
readily see what had to be
done to perform the
contract
Wilson v Northampton and Banbury
Railway Company 1874
Injunctions
Injunctions are either PROHIBITORY or
MANDATORY. Prohibitory ones are
used to stop one side acting positively
when the contract is designed to
prevent positive action. Mandatory
ones are used to compel some action.
Both are equitable and discretionary.
Prohibitory injunctions
See
Lumley v Wagner 1852
The courts only apply the Lumley and
Wagner use of injunctions where:
i.
- the contract had the negative
provision included as an express term,
and,
- the defendant is able to get some work
to live off: see
Warner Bros Pictures Inc v Nelson 1937
Mandatory injunctions
An example of when a mandatory
injunction might be used is to make a
landlord let tenants back if he evicted
them in breach of their contract.
Quantum meruit
Planche v Colburn 1831
British Steel Corporation v Cleveland
Bridge and Engineering Co ltd 1984
Cutter v Powell