Law
Content
Running Head:
Assignment Name
Student Name
Submitted to Institute
Running Head:
This essay looks in particular at damages which can be awarded by the courts when there
is a breach in a contract. Focusing on two of these being 'expectation loss' and 'reliance loss'.
Question 1
The modern technologies have made life very easy , everything is on click of a button.
But the life to that extreme is still not easy when it comes to legal issues . . Normally they would
have awarded an amount for diminution in value, but there was none. One problem was
highlighted with the refusal to award repair/reinstatement damages (where this is viewed as
disproportionate) is that it could be viewed as making it too easy for a 'cowboy builder' to cut
costs by not doing a proper job as they are in the knowledge that he will often not actually be
made to pay the cost of putting it right. One way of addressing this might be to make sure that a
party in this position always has to hand over (as an additional element of any damages) the
amount he actually saved by not doing the work properly. This would be 'restitutionary' damages
designed to prevent the builder in a case such as this being 'unjustly enriched' by his breach.
Such an approach would provide a contribution towards the customer's cost by fixing the
problem. In addition, if the contractors knew that such awards were possible, it would provide an
incentive to do the job properly in the first place.
Question2
The meaning of 'expectation loss' is where the courts give the innocent party an award of
damages which will put them in the same position as if the contract had been performed. For example if a
company was expecting goods to be delivered which were delivered late and as a result of that lost
profits. The damages entitlement would be the same as the profit he would have gained if he had the
goods on time. This has been called the 'expectation' damages.
. This appear to remain the doctrine in Johnson, however, the wrongful way in which one is
treated or dismissed from work and which affects one's reputation could well result in a level of upset that
crosses the line, into the realms of psychiatric injury and there will sometimes be a claim in such cases, as
was the situation in McCabe (this would then simply fall under injury
Running Head:
In many cases the cost (to the party who has broken the contract) when trying to repair/
instatement, the problem may not be significantly higher than the costs of paying diminution in
value. If so the party affected by the breach is entitled to claim the cost of repair/reinstatement.
However if the cost of the latter is disproportionately expensive for the party in breach, so much
more than it would cost simply to provide a partial refund, then the courts will not award
damages for repair/reinstatement. So in Meredith, the company sound repairing Ltd is liable of
loss encored to Meredith of 39 days as well as the ticket of the New English band.
Question 3
Firstly, injury, this is where the claimant did not expect to be caused injury (this includes physical
or mental illness and deaths) by products or services supplied by the company in question, for example in
Godley v Perry, a young boy was injured by goods sold in breach of the implied term as to quality (Sale
of Goods Act s.14) he is entitled to damages for injury.
Secondly, physical inconvenience, where the claimant expects not to suffer result of which could
lead to a claim. This means something affecting one physically, but not mounting to actual illness or
injury caused by the breach. An example of this is if persons' living conditions are bad and there have
been successful for cramped living arrangements caused by a solicitor failing to do all that should have
been done to ensure a house was available as was the case in Bailey v Bullock.
Thirdly, damage to property if for example B expects that property belonging to him will not be
damaged or destroyed by products or services supplied by A. The leading case that shows this is Wilson v
Rickett, where there was damage to the property caused by a detonator in smokeless fuel. B's property is
affected by goods sold in breach of the implied term as to quality (Sale of Goods Act s.14) he is entitled to
damages for the injury.
Fourthly, harm to reputation. Here the traditional rule is that the courts do not
accept that a person or business can expect his reputation not to be affected by a
breach as was the case in Addis there was no claim for damage to his reputation
caused by the way he was dismissed from his job
References
Benjelayel, K. (2012). Islamic Contract Law. Ssrn, 1–37
Craswell, R. (2000). Contract law: General theories. Encyclopedia of Law and Economics, 1–24.
Running Head:
Hermalin, B. E., Katz, A. W., & Craswell, R. (2007). Chapter 1 Contract Law. In Handbook of
Law and Economics (Vol. 1, pp. 3–138).
Hesselink, M. (2014). Democratic Contract Law. Amsterdam Law School Research Paper.
http://doi.org/10.2139/ssrn.2408426
Kraus, J. S. (2012). Philosophy of Contract Law. In Philosophy of Contract Law (pp. 687–751).
Assignment Name
Student Name
Submitted to Institute
Running Head:
This essay looks in particular at damages which can be awarded by the courts when there
is a breach in a contract. Focusing on two of these being 'expectation loss' and 'reliance loss'.
Question 1
The modern technologies have made life very easy , everything is on click of a button.
But the life to that extreme is still not easy when it comes to legal issues . . Normally they would
have awarded an amount for diminution in value, but there was none. One problem was
highlighted with the refusal to award repair/reinstatement damages (where this is viewed as
disproportionate) is that it could be viewed as making it too easy for a 'cowboy builder' to cut
costs by not doing a proper job as they are in the knowledge that he will often not actually be
made to pay the cost of putting it right. One way of addressing this might be to make sure that a
party in this position always has to hand over (as an additional element of any damages) the
amount he actually saved by not doing the work properly. This would be 'restitutionary' damages
designed to prevent the builder in a case such as this being 'unjustly enriched' by his breach.
Such an approach would provide a contribution towards the customer's cost by fixing the
problem. In addition, if the contractors knew that such awards were possible, it would provide an
incentive to do the job properly in the first place.
Question2
The meaning of 'expectation loss' is where the courts give the innocent party an award of
damages which will put them in the same position as if the contract had been performed. For example if a
company was expecting goods to be delivered which were delivered late and as a result of that lost
profits. The damages entitlement would be the same as the profit he would have gained if he had the
goods on time. This has been called the 'expectation' damages.
. This appear to remain the doctrine in Johnson, however, the wrongful way in which one is
treated or dismissed from work and which affects one's reputation could well result in a level of upset that
crosses the line, into the realms of psychiatric injury and there will sometimes be a claim in such cases, as
was the situation in McCabe (this would then simply fall under injury
Running Head:
In many cases the cost (to the party who has broken the contract) when trying to repair/
instatement, the problem may not be significantly higher than the costs of paying diminution in
value. If so the party affected by the breach is entitled to claim the cost of repair/reinstatement.
However if the cost of the latter is disproportionately expensive for the party in breach, so much
more than it would cost simply to provide a partial refund, then the courts will not award
damages for repair/reinstatement. So in Meredith, the company sound repairing Ltd is liable of
loss encored to Meredith of 39 days as well as the ticket of the New English band.
Question 3
Firstly, injury, this is where the claimant did not expect to be caused injury (this includes physical
or mental illness and deaths) by products or services supplied by the company in question, for example in
Godley v Perry, a young boy was injured by goods sold in breach of the implied term as to quality (Sale
of Goods Act s.14) he is entitled to damages for injury.
Secondly, physical inconvenience, where the claimant expects not to suffer result of which could
lead to a claim. This means something affecting one physically, but not mounting to actual illness or
injury caused by the breach. An example of this is if persons' living conditions are bad and there have
been successful for cramped living arrangements caused by a solicitor failing to do all that should have
been done to ensure a house was available as was the case in Bailey v Bullock.
Thirdly, damage to property if for example B expects that property belonging to him will not be
damaged or destroyed by products or services supplied by A. The leading case that shows this is Wilson v
Rickett, where there was damage to the property caused by a detonator in smokeless fuel. B's property is
affected by goods sold in breach of the implied term as to quality (Sale of Goods Act s.14) he is entitled to
damages for the injury.
Fourthly, harm to reputation. Here the traditional rule is that the courts do not
accept that a person or business can expect his reputation not to be affected by a
breach as was the case in Addis there was no claim for damage to his reputation
caused by the way he was dismissed from his job
References
Benjelayel, K. (2012). Islamic Contract Law. Ssrn, 1–37
Craswell, R. (2000). Contract law: General theories. Encyclopedia of Law and Economics, 1–24.
Running Head:
Hermalin, B. E., Katz, A. W., & Craswell, R. (2007). Chapter 1 Contract Law. In Handbook of
Law and Economics (Vol. 1, pp. 3–138).
Hesselink, M. (2014). Democratic Contract Law. Amsterdam Law School Research Paper.
http://doi.org/10.2139/ssrn.2408426
Kraus, J. S. (2012). Philosophy of Contract Law. In Philosophy of Contract Law (pp. 687–751).
