§ 3. Eemedies fob breach of Contract.

Remedies

for breach.

Having endeavoured to ascertain the rules which govern

the discharge of contract by breach, it remains to consider

the remedies which are open to the person injured by the

breach.

If the contract be discharged by the breach, the person

injured acquires or may acquire, as we have seen, three

distinct rights: (i) a right to be exonerated from further

performance ; (2) a right, if he has done anything under the

contract to sue upon a quantum meruit, a cause of action

distinct from that arising out of the original contract, and

based upon a new contract originating in the conduct of the

parties ; (3) a right of action upon the contract, or term of

the contract broken.

But we are now no longer specially concerned with that

breach of contract which amounts to a discharge : we may

therefore consider generally what are the remedies open

to a person who is injured by the breach of a contract made

Damages, with him. They are of two kinds : he may seek to obtain

damages for the loss he has sustained ; or he may seek to

obtain specific performance of the contract which the other

party has refused or neglected to perform.

But there is this difference between the two remedies:

every breach of contract entitles the injured party to dam^ages,

though they be but nominal ; but it is only in the case of

certain contracts and under certain circumstances that

specific performam.ce can be obtained.

We do not propose to treat of these remedies otherwise

than in the most general way, for the matter is one which

barely comes within the scope of this work : but it may be

well to state briefly some elementary rules which govern the

two remedies in question.

Specific

perform-

ance.

Chap. III. § 3. BY BREACH. 30I

Damages.

When a contract is broken and action is brought upon it, —

the damages being unliquidated, that is to say unascertained in

the terms of the contract, — how are we to arrive at the amount

which the plaintiff, if successful, is entitled to recover ?

(i) 'The rule of the Common Law is, that where a party Per Parke. b..

^ '^ ' r ./ Robinson v

sustains a loss by reason of a breach of contract, he is, so far ."l^j.

as money can do it, to be placed in the same situation, with

respect to damages, as if the contract had been performed.'

Thus where no loss accrues from the breach of contract, Damages

the plaintiff is nevertheless entitled to a verdict, but for represent

nominal damages only, and * nominal damages, in fact, mean I^^"

a sum of money that may be spoken of, but that has no p« Mauie. j..

^ ^ •' •/ JT / Ij, Beaumont

existence in point of quantity.' And so in action for the J c T'iJi*"*'

non-payment of a debt, where there is no promise to pay

interest upon the debt, nothing more than the sum due can

be recovered; for the possible loss arising to the creditor

from being kept out of his money is not allowed to enter

into the consideration of the jury in assessing damages,

unless it was expressly stated at the time of the loan to be

within the contemplation of the parties. But by 3 & 4 "Will.

IV. c. 42. § 28 a jury may allow interest at the current rate

by way of damages, in all cases where a debt or sum certain

was payable by virtue of a written instrument, or if not so

payable was demanded in writing with notice that interest

would be claimed from the date of the demand.

(2) The rule laid down by Parke, B., in Rohinaon v, so far as it

Harman must be taken subject to considerable limitations templation

in practice. The breach of a contract may result in losses °^ ^^^

f , '' parties.

which neither party contemplated, or could contemplate at

the time that the contract was entered into, and the Courts

have striven to lay down rules by which the limit of damages

may be ascertained.

3o^

DISCHARaE OP CONTRACT.

Part V.

9 Exch. 354.

Exceptional

loss should

be matter

of special

terms.

Per Blackburn,

J., in Home v.

Midland Rail-

way Co.

L. R. 8 C. P.

So in Hadley v, Baxendale it was decided that 'where

two parties have made a contract which one of them has

hroken, the damages which the other party ought to receive

in respect of such breach of contract should be such as may

fairly and reasonably be considered either arising naturally,

i. e. according to the usual course of things, from such breach

of the contract itself, or such as may reasonably be supposed to

have been in contemplation of both parties, at the time they

made the contract, as the probable result of the breach of it.'

And where special loss is in contemplation of the parties

from the breach of the contract, such loss as would not,

in the ordinary course of things, follow upon the breach,

it is not enough that the loss should be in contemplation of

the parties in order that it may be recovered as damages,

there must be 'evidence of an actual contract to bear the

exceptional loss arising from breach of contract.'

In Home v, Midlcmd Railway Comjpany, the plaintiff being

under contract to deliver shoes in London at an unusually

high price by a particular day, delivered them to the defend-

ants to be carried, with notice of the contract only as to the

date of delivery. The shoes were delayed in carriage, were

consequently rejected by the intending purchasers, and the

plaintiff sought to recover, besides the ordinary loss for delay,

the difference between the price at which the shoes were

actually sold and that at which they would have been sold

if they had been punctually carried. It was held that these

damages were not recoverable, in the absence of any evidence

that the Company undertook the increased responsibility

arising from the unusual price.

Damages (3) Damages in an action for breach of contract are by

of contract ^^J of compensation and not of punishment. Hence a

dictive^" plaintiff can never recover more than such pecuniary loss

as he has sustained, subject to the above rules. To this

general rule, however, the breach of promise of marriage is

Chap. III. $ 3. BY BREACH, 303

an exception, for in such cases the feelings of the person Hamun v.

injured are taken into account, apart from such specific fg'^g^N^" '

pecuniary loss as can be shown to have arisen.

(4) The parties to a contract not unfrequently assess the Assessment

by parties.

damages at which they rate a breach of the contract by one

or both of them, aad introduce their assessment into the

terms of the contract. Under these circumstances arises the

distinction between penalty and liquidated damages, which

we have already dealt with in considering the construction see p. 243.

of contracts,

(5) It follows from the general rule laid down by Baron in Robinson

Parke, that a diflRculty in assessing damages can in no way dis- ' ^"^ ^ss

entitle a plaintiff from having an attempt made to assess them.

A manufacturer was in the habit of sending specimens of Difficulty of

his goods for exhibition to agricultural shows, and he made a must be met

profit by the practice. He entrusted some such goods to a ^^ J^^*

railway company, who promised the plaintiff, under circum-

stances which should have brought his object to their notice,

to deliver the goods at a certain town on a fixed day. The

goods were not delivered at the time fixed, and consequently

were late for a show at which they would have been exhibited.

It was held that though the ascertainment of damages was f ™pson y^

difficult and speculative, its difficulty was no reason for not f q! a^a^V

giving any damages at all.

And further, the plaintiff is entitled to recover for prospective

loss arising from a refusal by the defendant to perform a con-

tract by which the defendant would have profited. Thus where

a contract was made for the supply of coal by the defendants

to the plaintiff by monthly instalments, and breach occurred

and action was brought before the last instalment fell due,

it was held that the damages must be calculated to be the

difference between the contract price and the market price

at the date when each instalment should have been de-

livered, and that the loss arising from the non-delivery

304

DISCHARaE OF CONTRACT.

Part V.

Roper V.

on,

8C. P.

{ohnson,

- R.

167.

Jurisdiction

of Chan-

cery, as to

specific per-

formance.

How

limited.

Kekewtch r.

Manninsf,

z D. M. & G.

Z76.

Flight V.

Bolland,

4 Russ. aga

of the last instalment must be calculated upon that basis,

although the time for its delivery had not arrived.

Specific Performance,

The jurisdiction, once exclusively possessed by the Court

of Chancery, to compel performance of a promise, supple-

mented the remedy offered by the Common Law Courts, which

was often inadequate or inapplicable to the loss sustained.

A promise to do a thing can be enforced by a decree for

specific performance, a promise to forbear by an injunction.

The exercise of this jurisdiction by the Court of Chancery

was limited by several rules, some of which have been al-

ready noticed. Defects in the formation of a contract afforded

an answer to a claim for specific performance, and in some

cases Equity was more guarded than the Common Law in

granting its remedy to suitors. A gratuitous promise though

under seal cannot be enforced in Equity, nor can an infant

obtain specific performance of a contract which cannot be

enforced against him.

But the substantial limitations on the employment of the

remedy were these.

The Courts will not decree specific performance —

1. Where the Common Law remedy of damages is ade-

quate to the loss sustained.

2. Where the matter of the contract is such that the

Courts cannot supervise its execution.

Specific

perform-

ance only

where

damage an

inadequate

remedy.

(i) The first of these rules is illustrated by the different

attitude which the Court has assumed in this matter towards

contracts for the sale of land and contracts for the sale of goods.

The objects with which a man purchases a particular piece

of land are different to those with which he purchases goods.

He may be determined, in making the contract, by the merits

of the site or its neighbourhood, and these cannot be repre-

sented by a money compensation ; whereas goods of the kind

Chtp. III. § 3. BY BREACH. 305

and quality that he wants are generally to be purchased.

Hence specific performance of a contract for the sale of goods

is only decreed in the case of specific chattels the value of Leake on

, Contract, itaj,

which, either from their beauty, the interest attaching to them, J^^SS **'*'*

or some other cause, cannot be represented by damages.

(2) And the distinction drawn between land and goods ^^^^^Jj^®

illustrates the second rule also. can insure

An agreement for the purchase of land can be performed ance.

by the doing of a specific act, the execution of a deed or l^f^JSc^**'^

conveyance. In a contract for the sale and delivery of goods t^nkS^ISr?:©.

performance may extend over some time and involve the Raoway ca. '

■^ "^ L. R. 16 Eq.

fulfilment of various terms, and * The Court acts only where " p* *»■

it can perform the very thiog in the terms specifically agreed eS!^'.

upon.' 80.

But the second rule is more distinctly illustrated by the

refusal of the Courts to grant specific performance of con-

tracts involving personal services ; though it will enforce

by injunction a promise not to act in a particular way.

Thus in Lumley v, Wagner, the defendant agreed with the xd. m. & g

plaintiff to sing at his theatre upon certain terms, and during

a certain period to sing nowhere else. Subsequently she

entered into an engagement with another person to sing at

another theatre, and refused to perform her contract with the

plaintiff.

The Court declined to enforce so much of the contract as

related to the promise to sing at the plaintiff's theatre, but

it restrained the defendant by injunction from singing else-

where.

The remedy has been extended to breach of contract for

the sale of specific goods by the Mercantile Law Amend- 19 &»vicL

ment Act.

And specific performance may now be granted by any Effect of

one of the Divisions of the High Court of Justice; for J^gj^^^*"^^

the Judicature Act has removed the old distinctions oif^^^'^^^

X

Sttb-s.7. ,f

3o6 DISCHABGE OP CONTRACT. Part V,

jurisdiction between the Common Law and Chancery Courts.

But to the Chancery Division is still reserved a special juns-

s. 34. sub-s. s . diction in suits for * specific performance of contracts between

vendors and purchasers of real estate, including contracts

for leases/