remedies - full course notes

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CL DAMAGES IN CONTRACT Purpose: To place Pl in position (as far as money can do) as if contract had been performed (Robinson v Harman) Onus is on P to prove there is a cause of action, causation and remoteness. Onus on D to prove Pl’s failure to mitigate unnecessary losses. CAUSE OF ACTION: 1) [x] has a cause of action for breach of contract Must prove actual loss for more than nominal damages (Erie County Natural Gas &Fuel Co case) Rule: termination of the contract not usually required for P to claim damages (Luna Park v Tramways) Exceptions: Anticipatory breach: damages only recoverable if contract is terminated (Mason v Sunbird Plaza) Claims for expectation damages (loss of bargain damages) damages only recoverable if contract is terminated Ready and willing to perform: To claim damages for the D’s breach, the P must be ready and willing to perform their side of the contract (Foran v Wight) If the K has been terminated: where the P terminates the contract following an anticipatory breach, the plaintiff need only show that this intention (to perform contract) existed prior to termination (Foran v Wight) CAUSATION: P must show that the loss suffered was in fact caused by D’s breach of contract. Single cause: “but for”: but for the defendant’s wrong would the P had suffered the loss or damage complained of? (Reg Glass v Rivers Locking System) REG GLASS v RIVERS LOCKING SYSTEMS Contract to install security door Breached it by installing incorrect door Someone broke in HELD: Burglary would not have occurred if the breach had not occurred – (but for test) Multiple causes: March v Stramare: test of “ordinary common sense and experience” Contributory negligence: Negligence of Pl can break chain of causation LEXMEAD (BASINGSTOKE) LTD V LEWIS P bought towing hitch to tow trailer He saw that it was damaged but continued to use it HELD: P was Contributory Negligent His own neglect (using something broken) caused his losses Severed the chain of causation no claim

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Remedies law unit notes.

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Page 1: Remedies - Full Course Notes

CL  DAMAGES  IN  CONTRACT  Purpose:  To  place  Pl  in  position  (as  far  as  money  can  do)  as  if  contract  had  been  performed  (Robinson  v  Harman)    

Onus  is  on  P  to  prove  there  is  a  cause  of  action,  causation  and  remoteness.  Onus  on  D  to  prove  Pl’s  failure  to  mitigate  unnecessary  losses.    

CAUSE  OF  ACTION:    

1) [x]  has  a  cause  of  action  for  breach  of  contract    

Must  prove  actual  loss  for  more  than  nominal  damages  (Erie  County  Natural  Gas  &Fuel  Co  case)    

Rule:  termination  of  the  contract  not  usually  required  for  P  to  claim  damages  (Luna  Park  v  Tramways)    

Exceptions:    

Anticipatory  breach:  -­‐damages  only  recoverable  if  contract  is  terminated  (Mason  v  Sunbird  Plaza)    

Claims  for  expectation  damages    (loss  of  bargain  damages)  -­‐damages  only  recoverable  if  contract  is  terminated  

Ready  and  willing  to  perform:    

To  claim  damages  for  the  D’s  breach,  the  P  must  be  ready  and  willing  to  perform  their  side  of  the  contract  (Foran  v  Wight)    

  If  the  K  has  been  terminated:  where  the  P  terminates  the  contract  following  an  anticipatory  breach,  the  plaintiff  need  only  show  that  this  intention  (to  perform  contract)  existed  prior  to  termination  (Foran  v  Wight)    

CAUSATION:    

P  must  show  that  the  loss  suffered  was  in  fact  caused  by  D’s  breach  of  contract.    

Single  cause:  “but  for”:  but  for  the  defendant’s  wrong  would  the  P  had  suffered  the  loss  or  damage  complained  of?  (Reg  Glass  v  Rivers  Locking  System)  

REG  GLASS  v  RIVERS  LOCKING  SYSTEMS  –    • Contract  to  install  security  door    • Breached  it  by  installing  incorrect  door    • Someone  broke  in    

HELD:    • Burglary  would  not  have  occurred  if  the  breach  had  not  occurred  –  (but  for  test)    

 

Multiple  causes:  March  v  Stramare:  test  of  “ordinary  common  sense  and  experience”  

Contributory  negligence:  Negligence  of  Pl  can  break  chain  of  causation  

LEXMEAD  (BASINGSTOKE)  LTD  V  LEWIS  –    • P  bought  towing  hitch  to  tow  trailer    • He  saw  that  it  was  damaged  but  continued  to  use  it    HELD:    • P  was  Contributory  Negligent    • His  own  neglect  (using  something  broken)  caused  his  losses    • Severed  the  chain  of  causation  à  no  claim      

Page 2: Remedies - Full Course Notes

Apportionment?  In  Astley:  HC  held  that  he  apportionment  legislation  did  not  allow  for  a  reduction  in  damages  in  any  contract  case.    

• Law  reform  act  reversed  it.      o ‘wrong’  means  an  act  or  omission  that:    

§ Gives  rise  to  a  liability  in  tort  for  which  a  defence  of  contributory  negligence  is  available  at  common  law;  or    

§ Amounts  to  a  breach  of  a  contractual  duty  of  care  that  is  concurrent  and  coextensive  with  that  duty  of  care  in  tort.    

• Eg  go  to  dentist  to  have  teeth  repaired    • Eg.  book  into  hotel:  concurrent  claim  in  K  and  tort  –  implied  

term  that  won’t  slip  and  hurt  your  back.    o Apportionment  –  s  10  –  CN  can  completely  remove  causation  or  be  an  

apportionment  issue    § (1)  If  a  person  (claimant)  suffered  damage  partly  because  of  the  

claimant’s  failure  to  take  reasonable  care  (CN)  and  party  because  of  the  wrong  of  someone  else:    

• (a)  a  claim  in  relation  to  the  damage  is  not  defeated  because  of  the  claimant’s  contributory  negligence;  and    

o (still  have  a  claim  despite  CN)    • (b)  the  damages  recoverable  for  the  wrong  are  to  be  reduced  to  

the  extent  the  court  considers  just  and  equitable  having  regard  to  the  claimant’s  share  in  the  responsibility  for  the  damage.    

o (and  damages  will  be  reduced)    

  Novus  actus  interveniens:    

    Test:  was  the  event  reasonably  foreseeable  by  def?    

 MONARCH  STEAMSHIP  V  KARLSHAMNS  OLIEFABRIKER  –    • Ship  chartered  to  carry  cargo  from  Venturia  to  Sweden  • Ship  not  seaworthy.  War  ready  to  break  out    • Government  ordered  it  to  unload  in  Glasgow  because  of  the  way  HELD:    • No  novus  actus.  They  knew  of  the  risk  of  war.  It  was  ‘reasonably  foreseeable’        ALEXANDER  V  CAMBRIDGE  CREDIT  CORP      -­‐    • Auditors  failed  to  give  proper  advice  on  their  financials.    • If  they  had  known,  they  would  have  put  it  into  receivership    • Sued  auditors  for  breach  of  K    • Auditors  blamed  government-­‐  bad  economic  policies  economic  policies  affected  the  company,  not  their  failure  to  

perform  their  duty  HELD:    • Can’t  say  that  the  continued  existence  of  the  company  caused  the  loss.    • Actual  effect  of  the  economy  after  the  breach  of  auditors  was  so  big  that  it  wiped  away  consequences  of  auditor’s  

breach  • To  establish  causal  connection,  P  need  only  to  show  that  it  was  one  cause  (common  sense  approach)      

REMOTENESS  

Test:  Hadley  v  Baxendale:  The  loss/damage  is  not  too  remote  if:    

First  limb    

1) Damages  arising  naturally  in  usual  course  of  things  from  breach  of  Contract  itself    • Direct  loss    • Presumed  to  be  in  the  contemplation  of  the  parties    

Second  limb    

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2) Was  reasonably  supposed  to  have  been  in  contemplation  of  both  parties  at  time  of  contract  as  the  probably  result  of  the  breach  of  it    

• Indirect  loss    • Innocent  P  to  prove  that  D  knew  or  ought  to  have  known  that  

damage  would  be  a  probably  result  of  breach    o And  in  contemplation  of  both  parties  at  the  time  of  the  

contract    • Mere  knowledge  is  insufficient  –  need  an  undertaking  to  bear  the  

unusual  loss  (As  term  of  C  or  orally)    

• Undertaking  to  bear  the  unusual  loss  may  be  implied  (Robophone  Finance  Facilities  v  Blank)    

• Factors:  what  was  D’s  actual  knowledge;  payment  If  D  received  something  extra  as  part  of  the  price  for  performance,  it  will  be  easier  to  draw  the  inference  that  the  D  has  accepted  the  risk  for  unusual  losses  because  the  risk  is  reflected  in  the  price.    (premium  for  the  risk)      

HADLEY  V  BAXENDALE    • P  owned  flour  mill.  Krank  shaft  in  mill  broke.  Had  to  send  it  away  to  get  replica  manufactured.  Gave  it  to  a  

courier  company  and  they  took  it  to  be  repaired  • Courier  company  breached  K  à  shaft  arrived  later  than  contracted    • EFFECT:  mill  had  to  shut  down  for  5  days    

HELD:    • Courier  not  liable  • Courier  would  not  know  that  a  failure  to  return  would  cause  the  loss  in  production  that  the  plaintiff  suffered    • D  liable  for  natural,  ordinary  loss  • For  others,  you  to  need  to  show  that  at  the  time  they  agreed,  the  additional  losses  were  in  the  contemplation  of  

the  parties    • NB:  is  special  circumstances  were  communicated  to  P?    

LIMB  ONE:  damages  arising  naturally  in  usual  course  of  things  from  breach  of  contract  itself    LIMB  TWO:  was  reasonably  supposed  to  have  been  in  contemplation  of  both  parties  at  time  of  contract  as  a  probable  result  of  breach        VICTORIA  LAUNDRY  V  NEWMAN  INDUSTRIES    

• Washing  and  drycleaning  establishment  had  K  for  supply  of  boiler  • Boiler  arrived  20  weeks  late.  Vic  laundry  didn’t  want  to  accept  it.    • Vic  had  secured  a  contract  from  the  government  to  dye  sheets.  They  therefore  lost  out  on  this  contract  because  

of  the  boiler.    HELD:      

• First  limb:  ordinary  losses  would  have  been  not  being  able  to  wash  and  dry  clothes    • Second  limb:  not  satisfied  (they  wouldn’t  have  contemplate  that  late  delivery  would  cause  them  to  miss  out  on  

a  contract.)        CZARNIKOW  V  KOUFOS  

• K was contracted to to ship sugar from Constanza to Basrah. Koufos arrived nine days late.  • Sugar prices had fallen.  • Czarnikow sued for loss of profits in the sale of the sugar.  

HELD:      • Loss was recoverable under the first limb of Hadley v Baxendale.  • Although Koufos did not know that it was intended that the sugar be sold at Basrah, he did know that Czarnikow was

a sugar merchant and that there was a market for sugar in Basrah. This was enough knowledge for Koufos to have contemplated that Czarnikow would suffer the loss in question.  

• Reasonably  foreseeable  that  a  delay  or  a  different  delivery  date  would  have  a  lower  price.        JACKSON  V  RBOS    

• Imported  dog  chews.  Sold  to  second  company  who  packaged  them  into  different  packages.    • Both  banked  at  RBOS.  Payment  was  by  a  letter  of  credit    • RBOS  accidentally  showed  Jackson’s  client  one  of  their  invoices    • Jackson’s  client  terminated  the  contract    • Claimed  against  bank  for  breach  of  contract  à  implied  confidentiality  and    HELD  

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• RBOS  negligently  exposed  info  • Another  issue:  loss  of  chance  of  future  profits    

   H  PARSON  (LIVESTOCK)  V  UTTERLEY  INGHAM    

• Farmed  pigs.    • Contracted  with  Uttley  Ingham  for  machinery  (hopper)  to  store  pig  nuts.    • Hopper  was  negligently  installed  à  didn’t  leave  hatch  open.  Pig  nuts  went  mouldy.  Pigs  died.    HELD  • Falls  under  first  limb.  –  natural  result  of  feeding  toxic  food  to  animals  is  illness,  and  perhaps  death  • Future  loss  of  profits  were  possibly  under  the  second  limb  

   PANALPINA  INTL  TRANSPORT  V  DENSIL  UNDERWEAR  

• D  made  it  clear  that  it  was  important  that  ht  goods  arrive  in  Nigeria  in  time  fort  he  Christmas  trade,    but  there  was  no  provision  in  the  contract  to  that  effect    

• Transport  underwear  to  Nigeria.  Arrived  late  on  the  21rd  of  Dec.    • Most  xmas  trade  had  passed    • Q:  would  they  have  known  Densil  would  lose  huge  profits?  HELD  • Yes.  Second  limb.    • There  must  be  an  undertaking  to  bear  the  unusual  loss    -­‐  it  need  not  be  a  term  in  the  contract  –  an  oral  

undertaking  may  be  sufficient.    • Undertaking  to  bear  the  unusual  loss  may  be  implied  (Robophone  Finance  Facilities  v  Blank)  

o If  D  received  something  extra  as  part  of  the  price  for  performance,  it  will  be  easier  to  draw  the  inference  that  the  D  has  accepted  the  risk  for  unusual  losses  because  the  risk  is  reflected  in  the  price.    

 

MITIGATION    

Damages  can  be  reduced  if  :    

• P  failed  to  take  reasonable  steps  to  reduce  loss  OR  • P  did  actually  take  reasonable  steps,  and  the  loss  was  actually  reduced    

NB:    

• Attempted  mitigation  that  increases  loss  is  recoverable  in  damages  (Simonious  Vischer  &  Co  v  Holt  &  Thompson)    

• Cost  of  mitigation  is  recoverable  (irrespective  of  whether  or  not  it  was  effective)    

What  is  reasonable?    

• Accepting  an  offer  to  help  from  D  (alternative  performance  or  another  contract)  (Payzu  v  Saunders)    

• If  D’s  breach  enables  the  P  to  obtain  benefits  not  otherwise  available,  the  P’s  gain  reduces  the  D’s  liability  (British  Westinghouse  Electric  v  Underground  Electric  Railways  Co.)  –  credit  for  benefits    

• P  not  required  to  accept  a  new  offer  of  employment  from  the  D  if  the  new  job  is  a  at  a  lower  status,  even  if  at  the  same  pay  (Schindler  v  Northern  Raincoat  Co)    

BRITISH  WESTINGHOUSE  ELECTRIC  V  UNDERGROUND  ELECTRIC  RAILWAYS  CO  • Made  turbines  in  London  underground.    • Not  powerful  enough.  Breach  of  K.    • London  underground  threw  them  out  and  bought  new  ones  which  worked.    • Buying  new  ones  was  reasonable  mitigation.    • But  now  they  put  themselves  in  a  better  position,  so  there  was  not  an  offset.  Couldn’t  claim  future  losses.  Could  

only  claim  for  the  period  they  used  them.    PRINCIPLE:    • Aim  is  to  put  them  back  in  the  position  they  would  be  in  had  the  breach  not  occurred.    • Here,  the  new  turbines  put  them  in  a  better  position.    • P  took  reasonable  steps  (replacing  the  turbines)  which  reduced  the  actual  loss  –  so  the  future  loss  that  they  

would  have  otherwise  incurred  (had  they  not  replaced  the  turbines)  was  not  recoverable.          PAYZU  V  SAUNDERS    

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• Buyer  had  a  credit  contract  with  the  seller.  Could  buy  silk.  Seller  cut  of  their  credit  and  would  only  sell  on  cash.    • They  1)  repudiated  it  2)  offered  to  allow  them  to  pay  cash  

HELD    • Reasonable  mitigation  to  accept  to  buy  on  cash  because  then  they  could  have  got  what  materials  they  needed.  

The  only  loss  they  were  entitled  to  was  the  value  of  the  credit  facilities  (nominal.)        SCHINDLER  V  NORTHERN  RAINCOAT  CO  

• Employer  purported  to  terminate  employment  contract  • Wasn’t  entitled  to.    • Offered  employee  another  position.  Employee  didn’t  take  it.    • Kept  contract  on  food  (affirmed  it.)    

HELD    • Employee  had  no  duty  to  mitigate.  Couldn’t  say  that  he  should  have  taken  the  other  job.    

     WHITE  &  CARTER  V  MCGREGOR    

• Contract  with  McGregor  to  put  ads  on  wheely  bins.    • On  day  it  was  due  to  start,  McGregor  wanted  out.  White  &  Carter  put  the  signs  up  anyway  (affirmed  it)  and  did  

it  for  3  years.    • NB:  you  can  affirm  a  contract  once  it  has  been  repudiated  if:  

o You  have  a  legitimate  interest  o You  don’t  need  the  cooperation  of  the  other  party    

HELD    • White  &  Carter  had  no  duty  to  mitigate  (ie  to  sell  the  space  to  someone  else.)    

   CLEA  SHIPPING  CORP  V  BULK  OIL  INTL  

• Ship  was  chartered  (2  years).  Ship  had  2  months  repairs.  Party  who  rented  it  said  they  didn’t  want  it.  Owners  affirmed  by  fixing  it  and  not  renting  it  someone  else    

HELD    • Unreasonable  to  affirm  it  because  of  the  economic  circumstances.    • “there  is  a  line  between  conduct  that  is  merely  unreasonable  and  wholly  unreasonable.”    

 

Anticipatory  breach    

• When  prior  to  the  date  set  by  the  contract  for  its  performance,  one  of  the  Ps  makes  it  clear  that  its  obligations  will  not  be  performed.    

• When  there’s  an  anticipatory  breach,  innocent  party  can  choose:    o Affirm  the  contract:  ignore  the  anticipatory  breach  and  hold  other  party  to  the  

contract    § No  duty  to  mitigate.  Contract  remains  on  foot  until  time  for  

performance  actually  arrives    o Accept  repudiation  and  terminat  the  contract    

§ Duty  to  mitigate  arises  immediately    § P  can  seek  damages  immediately  (date  for  assessment  will  be  date  set  

for  performance.)    

ASSESSMENT  OF  QUANTUM    

To  be  assessed  even  if  difficult  to  assess    

Date  of  assessment:    

• Assessment  at  date  of  breach,  but  flexible    o Not  followed  if  will  cause  injustice  (Johnson  v  Perez)    

• Once  and  for  all  rule  applies  –  periodic  payments  cannot  be  given  (Todorovic  v  Walker)    

GOLDEN  STRAIT  CORP  V  NIPPON  • K  for  charter  of  ship.  Contract  to  run  for  5  years.  Had  provision:  if  war  broke  out  between  

US  and  Iran,  parties  could  terminate  the  Contract.    • Chartered  breached  it:  repudiated  it.    • Owner  of  ship  accepted  repudiation.  

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• Couple  of  weeks  later:  war  broke  out.    • Went  to  arbitration.  Court  considered  the  provision.    

HELD    • P  not  entitled  to  the  benefit  of  the  rest  of  the  K,  only  up  to  the  war.    

 

Not  claimable:  mental  distress,  hurt  feelings,  loss  of  reputation  (Addis  v  Gramophone)    

HEADS  OF  DAMAGE    

Mental  distress    

Rule:  no  recovery  in  breach  of  contract    

  Except:  the  object  of  the  contract  is  to  provide  enjoyment,  relaxation,  freedom  from  molestation    

CASES:    

BALTIC  SHIPPING  v  DILLON    Breach  of  K  injured  the  P  both  physically  and  mentally    

• Ship  sank  • Generally  no  claim  for  lost  feelings/  disappointment    

HELD    • Mental  distress  flowed  form  what  the  K  was  actually  for.  The  object  of  the  K  was  enjoyment.    • Didn’t  allow  full  refund  because  she  had  9  of  the  14  days.    

 JARVIS  v  SWAN  TOURS    Skiing  holiday  

• Went  on  alpine  skiing  holiday  • Description:  amazing  things  • No  house  party  etc    

HELD    • Generally  no  compensation  for  lack  of  enjoyment  but  that  is  exactly  what  they  contracted  for.    • He  got  the  bed  etc  but  not  the  pleasure.  à  awarded  damages.    •  

HEYWOOD  V  WELLERS    P’s  solicitor  failed,  in  breach  of  their  retainer,  to  obtain  an  injunction  which  would  have  restrained  a  man  from  molesting  her  

• Put  junior  solicitor  on  a  job.  Injunction  not  granted  because  of  the  way  the  solicitor’s  firm  dealt  with  it.  Didn’t  get  the  restraining  order  on  someone  who  was  molesting  the  victim.    

HELD    • Allowed  return  of  all  lawyers  fees  –  she  got  no  value.  Proceedings  useless.    

 RUXLEY  ELECTRONICS  AND  CONSTRUCTION  v  FORSYTH    Pool  mean  to  be  a  of  a  certain  design  and  depth    

• Wanted  a  pool  7ft  deep.    • Pool  only  6ft  deep  

HELD    • Allowed  a  reduction.  Compensated  for  the  fact  that  you’ll  enjoy  it  a  little  less.    

 FARLEY  v  SKINNER    Loss  of  enjoyment  –  surveyor  erroneously  reprted  that  the  land  would  not  be  affected  by  aircraft  noise    

• Paid  $420,000  on  property  and  $100k  on  improvements.  Near  airport.  Surveyor  checked  property  before  he  bought  it.  Surveyor  didn’t  say  the  airport  would  be  too  loud.    

HELD    • Awarded  $10,000  for  distress.    

   

Expectation  losses  

Purpose:  put  in  position  Pl  would  have  been  had  the  contract  been  properly  performed    

• ‘loss  of  profits’  or  ‘loss  of  the  bargain’    • What  profit  would  P  have  received  if  the  contract  had  been  properly  performed?    

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• Even  if  no  net  profit  would  have  been  generated  for  the  plaintiff,  it  can  still  recover  damages  for  wasted  expenditure  or  reliance  damages.    

• Generally  only  available  once  contract  has  been  terminated  (Sunbird  Plaza  v  Maloney)    

Reliance  damages    

P’s  actual  costs  or  wasted  expenditure  as  a  result  of  relying  on  the  D’s  contractual  promise  

• Reubttable  Presumption:  that  the  contract  would  not  have  been  entered  into  unless  the  costs  were  recoverable.  P  need  only  prove  that  the  expenditure  was  incurred  and  that  it  was  reasonable.  (Commonwealth  v  Amann)    

• Onus  then  on  D  to  show:  the  wasted  expenditure  would  not  have  been  recouped  under  the  contract  has  it  been  performed.    

o If  P  made  a  bad  bargain  (wouldn’t  have  recouped  all  losses  even  if  the  K  was  performed  properly)  then  only  entitled  to  damages  for  the  amount  that  would  have  been  earned  if  it  had  been  properly  performed.  –  principle  –  P  is  not  entitled  to  be  placed  in  a  superior  position  due  to  the  breach.    

 

• Payments  made  under  the  contract  –  eg  supplying  team  of  workmen  ready  to  work;  costs  and  damages  associated  with  employing  a  subcontractor  

• CAN  CLAIM  BOTH  reliance  and  expectation  losses    o No  double  recovery  allowed    

 

McRAE  V  CTH  DISPOSAL  COMMISSION    • Mcrae  had  K  with  Cth  to  salvage  wreck  of  ship.  They  money  to  Cth  (making  the  wreck  theirs.)  There  was  no  

wreck.    HELD    

• Reliance  damages  for  loss  incurred  for  money  lost  in  reliance.  • Too  difficult  to  award  expectation  losses-­‐  didn’t  know  how  much  the  wreck  would  have  been  worth    

o “impossible  to  value  a  non-­‐existent  thing”        COMMONWEALTH  V  AMANN  AVIATION  –  expectation  losses    

• Amann  got  tender.    • Signed  Amann  to  do  surveillance  along  coast  of  Aus.  They  had  to  get  train  staff  etc  to  do  the  work.  Very  

expensive.  Cost  5.5-­‐6  million  to  get  started  (planes  etc.)  There  were  nowhere  near  ready  to  start  on  the  contracted  date.  Commonwealth  terminated  the  contract,  contrary  to  the  contract:  provision:  to  terminate  the  K,  would  first  have  to  engage  the  other  party  to  “show  cause.”  

• Amann  sued  Cth.    • Amann  did  not  get  any  income  of  out  of  this.  They  wanted  to  claim  their  losses.    • In  the  first  couple  of  years,  they  couldn’t  make  a  profit.  Would  only  make  it  if  it  was  renewed.    • PRESUMPTION  in  CORPS  LAW:  If  P  proves  that  they’ve  incurred  expenses,  a  presumption  arises  that  they  

would  recover  the  costs  in  the  contract.  D  bears  the  burden  to  prov  that  they  would  not  make  a  profit.    •  

HELD      

• Cth  had  not  complied  with  terms  of  the  K.    • Court  gave  pure  reliance  damages    • Couldn’t  prove  they’d  make  a  profit  à  therefore  no  expectation  losses.    

 

Restitution  damages    

• Can  get  back  what  you  have  performed.      • D  had  benefit  in  circumstances  where  it  would  be  unjust  to  allow  D  to  retain  it  at  P’s  

expense.    o Solicitor’s  fee  returned  for  bad  handling  of  the  case  (Heywood  v  Wellers)    o Awarded  an  amount  for  wasted  salvage  rights  (Mcrae  v  Cth)    

Indemnity  damages    

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• Purpose:  to  indemnify  against  loss.    • Damages  not  part  of  the  contract  and  not  necessary  for  the  performance  of  the  contract    

o AN  EXAMPLE:  new  boat  has  been  purchased  and  because  of  breach  of  contract,  negligent  mounting  of  engine,  caused  personal  injury.  Claims  for  personal  injury  possible  as  part  of  damages.    

o CASE  OF  EXPLODING  LIGHTBULB:      § Damages  awarded  where  defective  light  bulb  result  in  death  –  breach  of  

an  implied  term.  Couldn’t  sue  in  tort  –  no  negligence  alleged  or  proven.    

Loss  of  an  opportunity  or  chance      

• If  treated  as  a  causation  issue  then  loss  only  recoverable  if  ‘on  balance  of  probabilities’  a  loss  would  have  occurred  (50%+)    -­‐  tort  

• If  treated  as  assessable  head  of  damage  (IN  CONTRACT)  then  it  is  recoverable  even  though  the  calculation  of  the  loss  cannot  be  precise.    

LOSS  OF  AN  OPPORTUNITY  OR  CHANCE    LUNA  PARK  V  TRAMWAYS  ADVERTISING    

• Advertiser  didn’t  advertise  as  per  contract        HOWE  V  TEEFY    

• Race  horse  leased  to  P  for  3  years    • Contract  was  breached  when  owner  took  horse  back    • Claimed  for  chance  of  winning,  getting  money  from  betting  etc  

HELD    • Yes.  Natural  consequences  of  the  breach.  Not  too  remote.    

   JACKSON  v  RBOS  (dog  chew  –  bank  mistake  case)    

• Losses  for  future  renewals  of  the  K  HELD    

• Over  time,  contract  would  have  minimised  and  contract  would  have  likely  stopped.  This  reduced  the  damages  paid  for  loss  of  chance.    

   BURGER  KING  V  HUNGRY  JACKS    

• Contract  since  early  1970s  that  Hungry  Jacks  could  sell  franchises.    • Disputes  because  Burger  Kind  terminate  the  contract.    

HELD    • Q:  whether  Hungry  Jacks  had  suffered  a  loss  by  not  being  able  to  franchise    • Yes.  Potential  loss  of  royalty  income  from  franchise  process.    

 

Gratuitous  benefits    

• P  not  entitled  to  damages  for  loss  of  benefits  which  the  D  not  obliged  to  provide  (NSW  Cancer  Council  v  Sarfaty)    

• Court  will  look  at  express  and  implied  terms  to  determine  what  P  has  lost    o Can  include  ‘tips’  (Mannhaus  v  Leon)    

Damage  to  reputation    

Traditional  view  in  Addis  –  loss  of  reputation  caused  by  a  breach  of  K  not  available.    

• Addis  does  not  apply  to  all  breaches  of  K.  injured  feelings,  disappointment,  loss  of  publicity  and  loss  of  goodwill  have  been  compensated.    

DAMAGE  TO  REPUTATION    ADDIS  –  traditional  view    

• Wrongful  dismissal  case.    • Claimed  for  injured  feelings  and  the  fact  that  it  would  make  it  more  difficult  for  him  to  obtain  fresh  

employment.  HELD    

• Not  awarded.    

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 FLAMINGO  PART  V  DOLLY  DOLLY  CREATIONS    

• Fashion  designer  made  designs  for  fabric  • Contract  with  textile  company  stated:  only  to  be  used  on  good  material  and  solely  for  her.    • Dolly  dolly  took  the  designs  and  printed  on  other  bad  fabric  for  someone  else  • Affected  reputation  of  the  fashion  house.  

HELD    • Injury  to  reputation  was  compensatable  for  breach  of  contract  claim.    

   WHITE  V  AUSTRALIAN  AND  NEW  ZEALAND  THEATRES  

• White:  pantomime  artists.    • Theatre  appointed  new  producer  who  wanted  to  call  the  shots.    • This  affected  their  reputation    

HELD    • Compensation  allowed  for  damage  to  reputation    

 

Interest    

• P  is  entitled  to  payment  when  the  cause  of  action  arises  • If  payment  is  later,  then  interest  for  the  period  between  the  date  on  which  te  loss  

acrrued  and  the  date  when  the  judgment  takes  effect    • Purpose:  to  compensate  for  ‘being  kept  out  of  their  money’  (MBP  v  Gocic)  • Not  on  all  heads  of  damage  –  not  on  those  that  represent  loss  after  date  of  judgment    

 

Exemplary  damages    

NOT  AVAILABLE  FOR  BREACH  OF  CONTRACT    

• Even  where  the  K  has  been  breached  maliciously  or  intentionally.  (Butler  v  Fairclough)  • If  there  is  concurrent  claim  in  torts,  courts  can  award  exemplary  damages.    

o Eg  Tort  of  deceit  o Inducement  of  breach  of  contract    o Interference  with  contract.  (Zhu-­‐  court  awarded  exemplary  damages  for  

interference  with  contract)  

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TORTS        

[1]  Limitations  of  actions      Personal  injury:  actions  for  negligence,  trespass  or  nuisance  (contract  or  tort)  involving  personal  injury  or  death  must  be  brought  3  years  from  the  date  on  which  the  cause  of  action  arose.      Actions  of  contract  and  tort  and  certain  other  actions:  actions  for  breach  of  contracts,  or  actions  in  tort  which  do  not  involve  personal  injury  must  be  brought  within  6  years  from  the  date  on  which  the  cause  of  action  arose.    

(i) Time  begins  to  run  on  the  date  of  the  injury  or  the  day  the  damage  arises.      

Extension  in  cases  of  disability:  if  Pl  suffered  from  a  disability  preventing  the  bringing  of  an  action,  the  Pl  may  bring  the  action  up  to  6  years  from  the  date  on  which  the  disability  ended  (or  the  person  died)      Ordinary  actions:  if  a  material  fact  (of  a  decisive  character  relating  to  the  right  of  action)  was  not  within  the  means  of  knowledge  of  the  Pl  until  a  date  after  the  limitation  period  has  ended,  then  the  court  may  extend  the  limitation  period  by  1  year  from  that  date.      [1]  Cause  of  action    [x]  has  a  cause  of  action  in  negligence  for:  

• Property  damage    • Personal  injury    

[2]  Causation    To  prove  causation  under  the  CLA,  the  breach  must  be  a  ‘necessary  condition’  s  11(1)(a)  CLA  and  it  must  be  appropriate  to  extend  the  scope  of  liability  to  [the  harm  caused.]  To  decide  the  scope,  the  court  is  to  consider  whether  or  not  and  why  responsibility  for  the  harm  should  be  imposed  s  11(4).  We  must  use  CL  tests  to  determine  why  responsibility  should  be  extended.      Single  cause:    BUT  FOR  TEST:  Would  [P]’s  [specific  damage]  have  happened  but  for  [D]’s  [wrongful  act]  on  a  balance  of  probabilities?  (Barnett  v  Chelsea  Hospital  Management  Committee)    

Multiple  causes:    [D]’s  negligence  need  not  be  the  sole  cause  of  the  particular  harm,  it  need  only  be  a  necessary  condition.  (Cox  v  NSW)  In  cases  with  multiple  causative  factors,  Australian  judges  use  test  of  “ordinary  common  sense  and  experience.”  (March  v  Stramare)  

Proportionate  liability:  if  there  are  multiple  causative  factors,  the  court  can  apportion  liability  to  reflect  what  the  court  considers  ‘just  and  equitable’  ‘having  regard  to  the  extent  of  the  Def’s  responsibility  for  the  loss  or  damage’  s  31(1)(a)    

Exception:  Personal  injury  claims  are  not  apportionable.  Therefore,  [x]  can  only  select  one  defendant  and  if  more  than  one  person  causes  the  injury,  they  can  claim  from  each  other.    

NOVUS  ACTUS  INTERVENIENS  

[D]  will  argue  that  the  intervening  event  [‘the  collision  with  the  ambulance’]  is  an  intervening  event  that  breaks  the  chain  of  causation.  Therefore,  [P]  will  argue  that  the  subsequent  event  was  a  reasonably  foreseeable  consequence  of  [D]’s  negligent  conduct  and  that  [D]  is  liable  for  all  of  the  damage.    

Q:  Is  the  subsequent  event  a  reasonably  foreseeable  consequence  of  [D]’s  negligent  conduct?  

It  [is/is  not]  rf  ,  not  fff,  that  [D’s  negligent  conduct]  would  result  in  [intervening  event]  as….  

Its  occurrence  won’t  be  sufficient  to  break  the  chain  of  causation  if  it  is  precisely  the  sort  of  thing  you  would  expect  to  happen.  (Haber  v  Walker.)  

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Chain  of  causation  broken  by:  

a) A  human  action  that  is  to  be  properly  regarded  as  voluntary  (by  a  3rd  party  or  [P])  • Suicide  of  [P]  not  truly  voluntary  as  his  mental  state  was  such  that  he  had  been  deprived  

of  making  a  free  choice.  (Haber  v  Walker)    • Not  truly  voluntary  for  police  officer  to  lose  control  of  his  car  during  high  speed  chase  

because  he  was  only  responding  to  the  danger  created  by  the  driver  of  the  vehicle  being  pursued.  (Hirst  v  Nominal  Defendant.)    

• Becoming  addicted  to  drugs  after  primary  injury  was  the  voluntary  choice  of  [P]  and  the  drug  pusher  (Yates  v  Jones.)  

• Alcoholism  not  caused  by  primary  negligent  act  as  alcohol  consumption  was  truly  voluntary.  [D]  could  be  found  to  have  caused  it  if  it  was  the  only  way  to  relieve  the  pain.  (Havenar  v  Havenaar)  

b) A  causally  independent  event,  the  conjunction  of  which  with  the  wrongful  act  or  omission  is  by  ordinary  standards  so  extremely  unlikely  as  to  be  termed  a  coincidence  (Haber  v  Walker.)    • A  negligent  driver  running  into  a  car  parked  in  the  middle  of  the  road  is  not  an  

independent  event;  it  is  reasonably  foreseeable  ‘in  the  ordinary  course  of  things.’    -­‐facts  of  March  v  Stramare    

• D  is  not  liable  merely  because  [his/her]  negligence  brought  the  plaintiff  into  a  position  where  the  plaintiff  encounters  an  ordinary  hazard  of  life,  except  where  [D]’s  negligence  imposed  a  handicap  upon  [P]  meeting  that  hazard.  (Pyne  v  Wilkenfield).    

• Tripping  over  in  hospital  when  recovering  from  primary  damage  could  have  occurred  anywhere  and  was  not  caused  by  [D]  (McKiernan  v  Manhire)  

• Coincidence  =  being  hit  by  a  golf  ball.    

[3]  Remoteness    

In  order  to  recover,  [P]  must  show  the  damage  suffered  is  not  too  remote  in  law.  

 

The   [specific  damage-­‐eg  cuts]   suffered  by   [P]  must  have  been  of   such  kind   that   the  reasonable  man   would   have   foreseen:   Wagon   Mound   No   1.     In   this   case,   this   [kind   –   physical  injury/psychiatric   injury]  of  damage  would  be  reasonably  foreseeable  as  it   is  not  far  fetched  or  fanciful  that  [he/she]  would  suffer  as  a  result  of  [D’s  wrongful  conduct]:  (Wagon  Mound  No  2.)  

o Provided  the  type  of  harm  is  foreseeable,  the  extent  of  that  harm  and  the  precise  manner  in  which  it  occurred  is  irrelevant:  Hughes  v  Lord  Advocate;  

 

Egg   Shell   Skull  Rule:   If   [P]   has   shown   that   the   damage   is   reasonably   foreseeable,   then   [D]   is  liable   for  any  consequential  damage,  which  results  because  of   [P’s]  peculiarities:  Smith  v  Leech  Brain.  The  tortfeasor  takes  his  victim  as  he  finds  him  with  all  of  his/her  weaknesses  and  beliefs.    

   [4]  Mitigation  [x]  has  a  duty  to  mitigate  losses  flowing  from  D’s  wrong.    

• Cost  incurred  in  mitigation  is  recoverable  from  [D]  if  reasonable,  even  if  the  attempt  increased  the  loss.      

TEST:  what  would  a  reasonable  person  in  [P]’s  circumstances  have  done?    

• Takes  into  account  actual  circumstances  of  P.  Previously  the  hospital  deformed  his  finger,  wife  had  many  unsuccessful  treatments,  he  had  anxiety.  Held:  no  unr’able  failure  to  mitigate  his  damage  (Glavonjic  v  Foster)  

• P  suffering  from  conditions  casued  by  emissions  from  smeltering  factory.  Emissions  ruined  his  roof.  Not  fixing  roof  was  no  a  failure  to  mitigate  (Alcoa  Minerals  of  Jamaica  v  Broderick).    

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• What  if  mitigation  provides  a  benefit?    • 7yo  tractor  burnt  down.  Had  to  replace  tractor  and  mower  urgently  to  avoid  crop  losses.  

Purchase  new  tractor.  Had  to  account  for  the  benefit.  Circumstances:  He  was  going  to  stop  farming  and  sell  the  tractor.  Otherwise  it  may  have  been  a  different  outcome.  (Hoad  v  Scone  Motors)      

D  can  give  written  notice  to  suggest  specified  actions  P  should  take  to  mitigate.    Court  will  consider  if  P  acted  reasonably  if  he/she  did  not  follow  recommendations    

• Consider  if  D  offered  to  pay.    • Failure  to  follow  can  reduce  award  of  damages  if  unreasonable.    

 [4]  Quantum    Why?  To  put  the  P  in  the  position  as  if  the  tort  had  not  been  committed.      Once-­‐and-­‐for-­‐all  rule:  you  have  one  chance  to  submit  your  claim.  No  provision  for  going  back.    

• Award  given  by  lump  sum,  but  period  payments  available  through  statutory  exceptions  CLA.    

• Why?  Finality  in  litigation  (Fitter  v  Veal)      Exceptions:    

1. Substituted  award  by  appellate  (rare)    2. Where  there  are  different  causes  of  action  (Brunsden  v  Humphrey)    3. A  continuing  tort,  eg  recurrent  nuisance  or  trespass  4. Statutory  exceptions  –  allows  installments  to  be  paid  s  63  CLA  

 Date  of  assessment    

• Damages  assessed  by  reference  to:  date  on  which  cause  of  action  arose:    o Date  of  tort    o Date  on  which  injury  occurred/became  visible  

• Court  has  discretion  to  fix  own  date  to  provide  fair  compensation    • Date  of  judgment    

o Damages  for  personal  injury  and  defamation  normally  assessed  as  at  the  date  of  judgment.    

Heads  of  damage:      Future  hospital  and  medical  expenses    

• Injuries  requiring  further  medical  or  other  services    o Goods  and  treatment  necessary  for  health  and  comfort    o ‘Reasonable’    o At  home  or  in  hospital  –  whatever  is  fair  to  both  P  and  D    o Sharman  v  Evans    

§ Seriously  injured  in  accident.  Damaged  brain  stem.  Unconcious  for  one  month.  Could  speak/walk  and  no  control  over  basic  bodily  functions.  Suffered  from  epilepsy  and  struggled  to  breathe  but  was  unconscious.    

§ REMEDY:  would  be  better  to  be  cared  for  at  home  w  minor  adjustments.  The  cost  was  double  what  it  would  cost  to  be  care  for  in  hospital.    

• CONSIDERATIONS:    o What  would  be  reasonable  between  P  and  D  o No  real  evidence  she’d  be  better  at  home    o The  court  denied  the  request  and  based  the  remedy  n  

the  cost  of  the  hospital  stay  only    o REASON:  

§ So  it’s  not  punitive  to  D.      Gratuitous  services  (provided  TO  the  injured  person)    

• Services  rendered  by  a  family  member  without  compensation  • Would  otherwise  have  been  rendered  by  a  professional  • P  is  compensated    

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• Capped  by  CLA  s  59  • Griffiths  v  Kerkemeyer  

o Services  provided  free  of  charge.  If  P  was  not  compensated,  the  D  gets  benefit  from  family’s  good  nature.    

o underlying principle that it is a “plaintiff’s accident–caused need” which is compensated  

• Damages calculated at market rate – ie not the lost earning capacity of the carer – it’s the need that is created.  

• CLA: must have been provided for at least 6 hours a week for at least 6 months (see below)    

Damages for gratuitous services provided to an injured person – CLA s 59 (1) Damages for gratuitous services provided to an injured person are not to be awarded unless— (a) the services are necessary; and (b) the need for the services arises solely out of the injury in relation to which damages are

awarded; and (c) the services are provided, or are to be provided— (i) for at least 6 hours per week; and (ii) for at least 6 months. (2) Damages are not to be awarded for gratuitous services if gratuitous services of the same kind were being provided for the injured person before the breach of duty happened. (3) In assessing damages for gratuitous services, a court must take into account— (a) any offsetting benefit the service provider obtains through providing the services; and

(b)periods for which the injured person has not required or is not likely to require the services because the injured person has been or is likely to be cared for in a hospital or other institution.  

 Gratuitous  services  (provided  BY  the  injured  person)  –  s  59A     (1) Subject to section 59B, damages (section 59A damages) may be awarded to an injured person for any loss of the person’s capacity to provide gratuitous domestic services to someone else (the recipient) if subsection (2) or (4) applies. (2) Generally, the court may award section 59A damages only if it is satisfied of all of the following— (a) either— (i) the injured person died as a result of the injuries suffered; or

(ii) general damages for the injured person are assessed (before allowing for contributory negligence) at the amount prescribed under section 58, or more;

(b) at the relevant time the recipient was— (i) a person who resided at the injured person’s usual residence; or (ii) an unborn child of the injured person; (c) before the relevant time, the injured person— (i) provided the services to the recipient; or (ii) if the recipient was then an unborn child—would have provided services to the recipient

had the recipient been born; (d) the recipient was, or will be, incapable of performing the services personally because of the

recipient’s age or physical or mental incapacity; (e) there is a reasonable expectation that, if not for the relevant injury, the injured person would

have provided the services to the recipient— (i) for at least 6 hours a week; and (ii) for a period of at least 6 months; (f) there will be a need for the services for the hours and the period mentioned in paragraph (e), and the need is reasonable in all the circumstances. Future  economic  loss  and  lost  earning  capacity    

• Loss  of  wages  and  earnings  after  verdict    • Loss  of  earning  capacity  not  as  loss  of  earnings    • Not  easily  quantifiable    • TEST:    

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o (i)  Earning  capacity  has  in  fact  been  diminished  through  negligently  caused  injury  

§ eg  losing  fingers  may  not  affect  earning  capacity  to  teach    o (ii)  reduction  in  earning  capacity  will  cause  a  financial  loss    

• Medlin  v  State  Govt  Insurance  Commission    o Professor  at  Flinders  uni.  A  lot  of  pain  after  injury.  Impossible  for  him  to  do  his  

work.  Retirement  age  at  Flinders  uni  was  65.  He  decided  to  retire  at  60.  Early  retirement  was  the  result  of  the  injury.    

• Capped  under  CLA  s  54  o 3  times  average  weekly  earnings.    

• DEDUCTIONS:    o Discount  rate  ensures  the  lump  sum  payment  takes  into  account  NPV  the  5%  

rate-­‐  (CLA  s  57)  is  part  of  an  actuarial  calculation.    o Vicissitudes  of  life    

§ Must  consider  the  probability  of  something  happening  (Malec  v  JC  Hutton)    

§ When  looking  to  the  future,  a  ‘chance’  is  taken  into  account,  provided  ‘not  trivial,  not  insignificant’  

• Eg  a  10%    chance  in  future  that  P  would  become  unemployable  in  any  event    

§ Periods  of  unemployment,  leave,  illness,  accidents      

Superannuation      Cost  of  alterations  to  home    

• P  entitled  to  recover  cost  of  alterations  to  home  to  accommodate  post-­‐injury  position  o Eg  wheelchair  ramps    

• Principle:  where  ‘reasonable’  • Munzer  v  Johnston    

o M  seriously  injured  in  car  accident.  44  yo  at  accident.  48  when  at  court.  Awarded  3.1  mil.  Anniverary  of  her  daughter’s  death  was  coming  up.  Found  drugs  in  her  system;  Property  20ks  from  nearest  town.  House  on  the  property  was  shed-­‐like.  Had  outdoor  toilet.  Bath-­‐  they’d  raised  it  45cm  to  wash  the  dogs.    

o One  option  would  have  been  for  her  to  live  in  Gladestone.  Q:  should  be  be  allowed  to  stay  on  property?  She  had  already  decided  to  buy  a  kit  home  and  put  it  on  the  property.  

o HELD:  not  unreasonable  to  allow  her  to  live  on  the  property  even  though  cheaper  in  Gladestone.  The  barn  would  suit  her  needs.  She  could  also  build  her  hydrotherapy  pool.  Hydrop  pool  was  50k.  Would  be  beneficial.  Awarded  the  projected  cost  of  maintaining  that  pool.  Also  paid  for  hoist  to  get  her  in  and  out  of  the  hydrotherapy  pool.    

 Loss  of  amenities  and  enjoyment  of  life    

• Loss  of  ability  to  consciously  enjoy  life  to  the  full  or  to  the  extent  that  P  would  have  enjoyed  it,  had  it  not  been  for  the  injury    

• May  include  enjoyment  and  satisfaction  you  get  from  work    o Court  will  not  award  damages  if  not  aware  of  the  loss    

§ Skelton  v  Collins    • Permanent  vegetative  state.  Alive  but  not  conscious.  

§ Sharman  v  Evans    • Couldn’t  do  anything.  Life  shortened,  reliant  on  everyone.  She  

was  aware  of  her  loss.      Pain  and  suffering  (past  and  future)    

• Includes  physical  and  mental  pain  • Precise  calculation  impossible    

o Difficulty  does  not  prevent  calculation  (O’Brien  v  Dunsdon)    o Capped  under  CLA  s  61  and  s  62  

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§ General  damages  include  ‘pain  and  suffering’  and  ‘disfigurement’    Loss  of  expectation  of  life    

• Lifespan  shortened  as  a  result  of  injury  • By  how  much?  Basis  of  calculation  =  ‘historical’  tables  of  Aus  Bureau  of  Statistics  • Awarded  for  prospective  happiness  in  period  by  which  life  has  been  shortened.    • Capped  under  CLA  s  61  and  s  62  

o ‘non  economic  loss’  defined  to  include  ‘loss  of  expectation  of  life’      

Injury  scale  value    • Work  out  where  they  fall  on  the  scale.  This  will  tell  you  the  monetary  range.  Once  you  

have  an  injury  scale  value,  there’s  no  room  variation  of  general  damages.      Loss  of  consortium,  loss  of  servitium  s  58  

• Loss  of  partnership,  friendship  etc  of  a  spouse.  • Not  for  injured  person  but  for  the  third  party  eg  husband.    • Statutory  requirement  CLA  s  58  

o Injured  person  died  as  a  result  of  the  injuries,  OR  o General  damages  for  injured  person  assessed  (before  allowing  for  contributory  

negligence)  at  $30,000+    o Loss  of  consortium  capped  at  3  times  average  weekly  earnings.    

 [4]  Defences      Contributory  negligence    

• Contributory  negligence  can  defeat  a  claim    • Reduction  of  100%  possible    • Adjustment  to  be  made  right  at  the  end.    • TEST:  Standard  of  care  required:  reasonable  person  in  the  position  of  the  Pl,  with  

consideration  of  what  the  person  knew  or  ought  to  have  known  –  CLA  s  23(2)  (a)  and  (b)        Volenti    

• Voluntary  assumption  of  risk    • Complete  defence    • (1)  Knowledge  (2)  understood  and  accepted  the  risk  (3)  participated  voluntarily  in  the  

risk      Other  CLA:    

• dangerous  recreational  activities  –  presumption  of  awareness  of  risk,  no  general  duty  to  warn  of  obvious  risks,  and  no  liability  if  an  inherent  risk  materialises.    

   Exemplary  and  punitive  damages    Available  for  many  claims  in  tort.      S  52  CLA:    RULE:  Exemplary  (punitive)  and  aggravated  damages  cannot  be  awarded  for  a  claim  for  Personal  Injury    

Exception:  When  the  personal  injury  is  cause  negligently,  but  intentionally  –  eg  banana  peel  left  on  flood  hoping  they’d  slip.      

 Aggravated  damages  (PUT  AS  A  HEAD  OF  DAMAGE)    

• Awarded  to  compensate  for  injured  feelings  or  dignity  • Not  available  for  negligently  caused  personal  injury    • Available  for  intentionally  caused  personal  injury;  also  trespass,  false  imprisonment,  

defamation,  assault  etc    • Actual  physical  injury  may  be  insignificant  although  aggravated  damages  awarded  for  

injury  to  feelings  or  dignity    • Plead  specifically.    

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 Joint  and  severally  liable?  Will  depend  on  their  involvement    

• Konstantiniidis  v  Foreign  Media:  liability  of  4th  defendant  reduced  because  he  did  not  engage  in  defamatory  conduct    

• RULE:  aggravated  damages  are  assessed  on  the  basis  of  the  particular  malice  of  each  joint  tortfeasor  (De  Reus  v  Gray)      

Exemplary  damages  • Purpose  is  punitive    • Also  intended  to  deter  and  stop  need  for  revenge  and  self-­‐help  that  threatens  peace  and  

order  • Def’s  conduct  to  have  been  high-­‐handed,  insolent,  vindictive  or  malicious,  cruel,  or  

showing  a  contumelious  disregard  for  the  Pl’s  rights  • Often  claimed,  rarely  awarded    • If  awarded  in  addition  to  compensatory/nominal  damages,  it  will  be  a  windfall  

o General  rule  is  that  proof  of  loss  is  part  of  the  gist  of  the  action,  then  exemplary  damaged  will  be  parasitic  on  such  compensatory  dmages  –  must  first  satidfy  the  host  claim    

• Can  have  a  claim  for  exemplary  damages  for  negligence  (Coloca  v  BO  Australia)    • Typically  awarded  separately  to  different  defendants    

 XL  Petroleum  v  Caltex  Oil    

• Vandalised  smaller  petrol  stations  by  putting  things  in  their  oil  • Business  damage  was  minimal  • Exemplary  damages  awarded  -­‐  $125,000  

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SELF  HELP  REMEDIES  Self  help  means  providing  a  remedy  that  does  not  require  judicial  intervention  (but  still  must  be  within  parameters  of  the  law)    Self  help  and  the  law    

• Self-­‐help  actions  may  not  breach  the  law    • All  of  the  risks  which  you  attempt  to  avoid  in  K  can  be  broadly  considered  self-­‐help  

remedies.    Self  help  remedies  in  CONTRACT    

• Contract  may  include  virtually  any  terms    • Contract  terms  are  subject  to  rules  regarding  penalties  and  statutory  provisions    • Reasons  for  contractual  remedies:    

o Reduce  hostility  o Prevention  of  disputes    o Avoidance  of  litigation  

EXAMPLES  OF  NEGOTIATED  CONTRACT  REMEDIES    • Progress  payment  clauses    

o Eg  pay  only  once  work  has  progressed  eg.  building  to  windowsill  height  so  that  you  don’t  have  to  spent  money  until  performance  has  been  met.    

• Liquidated  damages  (fixed  sum,  predetermined,  a  genuine  pre-­‐estimate  of  the  loss)    o Eg  interest  to  be  paid  if  late  

§ Court  interpreting  it?    1. Look  at  ordinary/natural  meaning  of  the  clause    2. Interpret  the  clause  by  taking  the  overall  contract  into  

considerationàto  establish  intention  of  the  parties  (wont  consider  the  clause  in  isolation  

3. Contra  preferentum:  if  ambiguity,  interpreted  against  the  person  for  whose  benefit  it  was  inserted.    

o Renting  while  building  a  house  ie  important  contract  finished  b  1st  Dec.  If  not  contractor  will  pay  you  the  cost  of  rental  to  compensate  you  for  the  loss  you  would  have  suffered    

• Right  to  terminate  for  serious  breach    o Eg  a  “timing  is  of  the  essence”  clause  –  makes  any  clauses  about  timing  a  

condition  à  therefore  can  terminate  for  breach    INTERPRETATION  OF  SELF-­‐CREATED  CONTRACTUAL  REMEDIES    

• Aim:  to  give  effect  to  the  intention  of  the  parties    • If  a  term  has  been  designated  as  a  “condition”,  generally  seen  as  a  “serious  term”    

o But  not  if  result  would  be  so  unreasonable  that  court  may  decide  that  it  could  not  have  been  the  intention  of  the  parties    

 Schuler  v  Wickham    

• Condition  that  agent  visited  all  of  the  customers  once  a  week.    • Court  had  to  look  at  how  it  would  interpreted  strictly    • HELD:  although  ordinary  meaning  made  it  clear  that  not  visiting  was  a  breach,  

when  they  looked  at  the  overall  K  and  all  of  the  things  that  the  agent  had  to  do,  the  court  said  that  the  clause  did  not  take  into  consideration  reasons  that  this  couldn’t  happen  (eg  sick)  so  it  couldn’t  be  the  intention  of  the  parties  to  require,  without  exception,  agent  to  visit  every  customer.    

o Not  a  condition  even  though  they  said  it  was      

• Penalty  clauses    o Acceptable  if  a  genuine  pre-­‐estimate  of  damages  not  punitive    

 Dunlop  Pneumatic  Tyres  v  New  Garage    

• Dunlop  wanted  a  minimum  (list)  price  no  matter  where  they’re  sold  • K  said  “we  agree  to  pay  Dunlop  5  pounds  for  every  tube,  tyre  etc  sold  in  breach  

of  this  agreement  by  way  of  liquidated  damages  and  not  by  way  of  penalty”    • IMPORTANT:  how  to  distinguish  between  liquidated  damages  

(purpose=compensate)  and  penalties  (purpose=to  punish)  

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o 1.  TEST:  what  does  the  purpose  appear  to  be?  § Terrify?  Ie.  Will  people  perform  for  fear  of  paying  penalty.  If  to  

coerce/punish  à  penalty.  NB:  sheer  size  may  indicate  that  it’s  a  penalty  

§ Is  it  a  genuine  pre-­‐estimate  of  the  damage?  If  yes,  liquidated  damages  clause.    

 HELD:  difficult  to  determine  loss  arising  from  each  particular  tyre  sold.  HELD:  this  was  a  genuine  pre-­‐estimate,  especially  if  lots  of  tyres  are  being  sold  below  the  list  price.    

LIQUIDATED  DAMAGES  VS  PENALTY  CLAUSES    o Withholding:  If  you’re  taking  away  more  than  you  would  receive,  likely  a  penalty  o Fixed  charge:  if  no  matter  whether  the  breach  is  big/small  you’ll  be  charged  $80,  then  

pure  penalty  because  it’s  not  linked  with  what  actual  loss  is  likely  to  be  incurred.    o If  it’s  outrageously  high  à  prob  a  penalty  (not  a  genuine  pre-­‐estimate  of  the  loss)    

 SELF  HELP  REMEDIES  IN  TORT    Abatement  of  nuisance    

o Privilege  of  abatement  (do  something  to  stop  it  –  within  parameters  of  the  law)    o Only  what  is  necessary  to  avoid  the  harm  o On  own  land    o If  on  land  of  the  creator  the  nuisance  à  possible  trespass  and  would  need  strong  

justification    o Requies  notice  to  the  owner    

§ Unless  immediate  danger  to  life  or  health  making  it  unsafe  to  wait  (Traian  v  Ware)    

o Need  not  wait  for  loss  to  occur  –  can  be  pre-­‐emptive    o But  need  to  be  careful  because  you  need  proportionality    

o Abatement  –  damages  before  can  be  claimed,  but  probably  not  for  damages  AFTER  abatement  (because  once  you  “abate”  you’ve  taken  away  the  loss)    

 Traian  v  Ware    

o Went  onto  neighbours  land  and  broke  the  bank  because  it  was  damming  up  the  water.    

o HELD:  self  help  remedy  had  been  used  high-­‐handedly.  D  could  have  contacted  P.  P  could  have  channelled  the  water  elsewhere.  The  lack  of  notice  meant  it  was  a  trespass  to  property.    

o Principle:  only  reasonably  measures  which  are  necessary  to  avert  the  harm/avoid  the  loss  (proportionality)  can  be  taken.    

Abatement:    1. Give  notice    2. The  cost  is  born  by  the  person  abating    

a. BUT  if  you’ve  acted  to  mitigate,  you  may  claim  the  cost    3. Must  be  reasonable    4. Can’t  do  significant  damage    5. Avoid  force    6. If  entering  someone  else’s  land,  must  have  good  reason.    

 Tort-­‐  trespass    

o Evict  uninvited  intruders/trespassers    o May  use  reasonable  force  to  achieve  that  purpose    

§ Person  who  takes  these  steps  must  prove:  • 1)  there  was  a  trespass  • 2)  the  steps  taken  were  reasonable  (what  is  r’able  depends  on  facts)  

o Proportionality  is  important    o Should  ask  them  to  leave  first  

o Defensive  action  against  trespassers    o Intention  is  important    

§ Deterrent  or  retributive?    

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o Would  depend  on  the  nature  of  the  ‘attack’,  whtehr  it  is  propery  or  person  attacked,  and  currently  applicable  legal  and  social  standards  as  to  degree  to  which  property  may  be  protected    

   Bird  v  Holbrook  Shooting  guy  who  was  stealing  his  bulbs    

• Tulips  reached  exhorbitant  prices    • Farmer  had  trouble  with  people  stealing  his  bulbs    • He  set  up  a  spring  gun  à  whoever  tripped  the  wire  would  be  shot  by  

pellets  (it  wouldn’t  kill  them)    • HELD:  not  a  valid  self-­‐help  remedy.  Problem:  the  degree  of  force  used  but  

mostly  the  purpose:  o If  it  was  a  deterrent  it  would  have  been  visible.    o Here-­‐  punitive  (retributive)    o Taking  law  into  own  hands.  It  was  malicious.    

• Principle:  self  help  remedy  has  to  commensurate  with  what  would  be  a  legal  penalty.  Can’t  inflict  more  harm  that  what  would  be  a  legal  remedy.    

 o Squatters    

o Can  also  evict  persons  in  possession  of  property  and  squatters    o Can  use  force  that  is  reasonably  necessary    

o Persons  with  some  lawful  right/previous  lawful  right    o Need  to  use  legal  process    

o Chattels  or  good  that  can  harm  property  or  inhabitant/owner    o Eg  Frisbee  in  neighbours  yard.  o Reason  for  trespass  à  is  it  serious?  What  is  socially  acceptable?  Circumstances  

will  determine  what  is  reasonably  necessary  and  then  what  is  proportionate.    Tort-­‐  defence  against  trespass  to  person    

o Can  defend  against  attack  with  force  but  not  a  greater  degree  of  force  than  is  ‘reasonable’  when  protecting  human  life  

o What  is  reasonably  necessary?  o Question  of  proportionality  o Self-­‐defence  defences  can  be  rejected  if  force  is  excessive    

o Fontin  v  Katapodis    o Argument  in  hardware  shop.  o Katapodis  accused  F  of  stealing  something  that  he  didn’t.    o F  hit  Katapodis  with  a  stick.  Other  employee  came  to  help.  Katapodis  took  a  

piece  of  glass  to  defend  himself  which  caused  harm  to  F.    o HELD:  not  proportionate.  Not  acceptable  self  help  remedy.    

o Underhill  v  Sherwell    o Her  injuries  indicated  some  sort  of  force  o He  has  to  show  that  it  was  reasonable  in  the  circumstances.  

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Specific  Performance    What  is  it?  Order  from  court  that  directs  a  party  to  perform  the  agreement.      It  can  be  a  threatened  or  actual  breach.      Narrowly:    

• Executory  contracts      In  a  wider  sense:    

• Executed  contract  • Contract  with  consideration  

 Available  if:  

1. An  agreement  (TEST  1)  2. Breach  or  threatened  breach  of  agreement  by  Def  (TEST  2)  

o But  contract  can’t  be  terminated    3. CL  damages  would  be  an  inadequate  remedy    TEST  3  4. No  discretionary  defence  or  denial  to  disentitling  relief.  TEST  4  

 [ELE  1]:  Agreement      Either:    1)  Agreement  that  is  enforceable      2)  Unenforceable  agreement  that  can  be  made  enforceable  by  doctrine  of  Part  Performance  (in  equity)      Unenforceable  if:    

• K  is  uncertain    • K  has  been  rescinded  by  the  Pl  

 Doctrine  of  Part  Performance:    

• Transaction  unenforceable  at  law  or  under  a  statute  may  be  enforced  if  equitable  doctrine  of  part  performance  has  been  satisfied.  

o Eg:  where  there  is  an  oral  agreement  that  has  to  be  in  writing  through  statutory  requirement    

• Purpose  of  doctrine:  enlarge  part  performance  to  full  performance    o Mainly  applies  to  land.    

 • Maddison  v  Alderson  –  housekeeper  on  farm      

o A  had  oral  agreement  with  housekeeper,  M,  that  he  would  give  her  a  life  estate  in  the  farm  

o She  would  then  work  for  free    o He  didn’t  leave  it  in  his  will    o AT  CL:  had  to  be  in  writing    o PART  PERFORMANCE:    

§ Evidence  of  existence  of  K  § HELD:  living  on  a  farm  and  working  for  free  is  not  part  performance.  

Actions  must  be  “unequivocally  referrable”  to  the  promise.  That  was  not  the  only  reason  she  performed  the  services.      

• Kouri  v  Kouri  –  selling  house  to  brother    o 7  brother  and  sisters.    o Some  of  them  bough  a  house.  2  lived  in  it.    o 3rd  sold  his  ownership  to  his  brother,  B  (who  paid  him).  o All  done  orally,  not  in  writing.  o B  also  repaid  some  loans  his  brother  had  to  get  the  house.    

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o He  didn’t  get  the  house  o HELD:  he  did  not  perform  the  actions  of  an  owner    

         [ELE  2]:  Breach  or  threatened  breach  of  agreement  by  def      [X]  has  [breached/threatened  to  breach]  the  agreement  by  […]      K  must  not  be  terminated:    [X]  has  terminated  the  K  by  […],  therefore  specific  performance  is  not  available.      [ELE  3]:  CL  damages  would  be  inadequate    Damages  are  inadequate  if  they  cannot  satisfy  the  demands  of  justice.  Justice  to  a  promisee  may  require  that  a  promisor  perform  what  he  has  promised  (Zhu  v  Treasurer  of  NSW).      

• Sale  of  racehorse    • Publication  of  an  apology  • Contract  to  settle  litigation    • Land    

o Equity  always  ordered  SP  for  contracts  for  sale  of  land    § No  real  substitutes,  land  may  have  ‘a  peculiar  and  special  value’  (Adderley  v  

Dixon)    o Remedy  usually  has  to  be  available  to  both  purchaser  and  vendor  (mutuality)    

• Money    o Damages  generally  adequate  for  breach  of  K  to  pay  money    o Except    

§ If  purchaser  can  obtain  SP,  then  the  vendor  can  also  obtain  SP    § If  damages  inadequate  (some  indemnity  contracts,  security  contracts,  

contracts  for  payment  of  money  and  land)    • (Loan  Investment  Corp.  v  Bonner)  

o Combo  of  sale  of  property  and  a  loan  attached  o Breach:  failure  to  grant  a  loan  o HELD:  no  SP  because  they  were  so  interlinked    

§ Agreements  to  pay  money  to  3rd  parties  (privity  doctrine)    • Coulls  v  Bagot’s  Executor  and  Trustee  Co  

o Agreement  to  quarry  a  property  and  would  pay  for  the  rights  when  did  –  did  privity  prevent  her  from  claiming?  

o HELD:  she  was  a  third  party    • Beswick  v  Beswick    

o Uncle  sold  his  business  to  nephew  in  exchange  for  sale  of  business.  Agreed  to  pay  him  an  amount  each  month  for  the  rest  of  his  life.  

o After  uncle  died,  would  have  to  pay  wife  5  pounds  every  week.    

o She  sued  because  she  was  the  executor  of  the  estate.    o HELD:  No.  Not  because  she  didn’t  follow  the  right  process  

but  because  he  had  passed  away.  (agreement  was  to  pay  the  husband.)      

• Goods  (personal  property,  chattels)    o Generally,  contracts  for  sale  of  goods  not  specifically  enforceable    o Except  

§ If  article  is  of  unusual  beauty,  rarity  or  distinction  (original  painting,  vintage)  –  damages  will  be  inadequate  

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• Not  inadequate  if:  supply  is  merely  low  (temporarily)    • Cook  v  Rodgers    

o Sale  of  car  after  WW1  o HELD:  mere  temporary  unavailability  of  car  did  not  mean  

that  damagers  were  inadequate    • Dougan  v  Ley    

o K  for  sale  of  taxi  after  WW1.  Vehicles  were  rare.    o Taxi  license  was  attached  to  the  car    à  had  to  buy  vehicle  

with  license  (licenses  were  rare  and  hard  to  come  by)    o HELD:  taxi  unique.  Damages  not  an  adequate  remedy    

• Doulton  Potteries  v  Bronotte  [FIX  THIS]  o Dye.  o Breach:  repairer  and  Doulton  o HELD:  mandatory  injunction  because  dye  was  

irreplaceable.  If  you  wanted  to  make  a  copy  you  reduced  it.    

• Personal  services    Damages  may  not  be  adequate  if  the  services  of  a  particular  person  are  required.  Often  not  possible  to  obtain  SP  because  of  discretionary  factors.       -­‐slavery:  forcing  someone  to  work  for  someone  else.    

• Intellectual  property    These  rights  are  unique  Contracts  concerning  patents,  designs,  copyright  or  trade  marks  are  specifically  enforceable  if  damages  are  inadequate    

• Goodwill  and  business  assets    Chattels  with  business  value  –  SP  possible    

• Stocks,  shares  and  securities  SP  not  available  unless  a  type  of  share  is  not  readily  available  on  the  market            

[ELE  4]:  No  discretionary  defence  of  denial  to  disentitling  relief        

[1]  Continuing  supervision:  courts  may  refuse  order  of  SP  if  the  continued  performance  o  the  K  will  require  continuous  supervision  of  the  court    

• Ie  it’s  likely  the  dispute  would  continue  and  the  SP  would  not  solve  the  problem  o Carrying  on  a  business:    

§ Courts  will  not  order  a  business  to  be  carried  on  over  an  extended  period  of  time  (Cooperative  Insurance  Society  ltd  v  Argyll  Stores)    

o Building  and  repair  covenants:    § Courts  do  grants  orders  of  SP  in  building  and  repair  covenant  cases  despite  

the  need  for  supervision  provided  the  terms  of  the  order  is  precise  (Cooperative  Insurance  Society  ltd  v  Argyle  Stores)  

• A  entered  into  lease  with  company  who  owned  shopping  centre  for  35  years    

• After  15,    close  up  shop  (breaking  K).  They  were  head  tenants  à  when  they  left,  it  affected  the  income  for  other  tenants.  

• P  wanted  SP  to  make  A  open  up  their  store    • Here,  damage  may  be  inadequate    • Must  think  about  the  practicality  of  this  order  –  can  you  calculate  

the  $$  effect  on  other  tenants?  • HELD:  

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o  If  we  order  them  back  in,  the  K  doesn’t  say  exactly  what  is  considered  “trading”  for  it  to  be  performed.  

o Considered  burden  on  the  D,  compared  with  the  loss  the  landlord  has  suffered.    

o SP  NOT  granted.      

Effect  of  ignoring  an  order  for  specific  performance:  contempt  of  court    

[2]  Personal  services:  Courts  traditionally  do  not  award  SP  for  breach  of  K  for  personal  services  

Reasons:    

• Would  require  constant  supervision  of  the  court  • May  compel  unwilling  parties  to  maintain  personal  cooperative  relations    • Difficult  to  enforce  because  performance  of  personal  service  contracts  involve  matters  of  

personal  opinion  and  taste  (eg.  not  performing  it  to  the  best  of  their  ability)  (Lumley  v  Wagner).    

Look  at:    

[1]  Hardship    [2]  Clarity  with  which  services  has  been  described  (Posner  v  Scott-­‐Lewis)  [3]  Continuous  supervision  [4]  Whether  terms  would  be  too  harsh  on  D  if  enforced  (De  Francesco  v  Barnum)      

• De  Francesco  v  Barnum      o Dancer:  obligations  onerous  o She  wasn’t  allowed  to  get  married  etc.  He  had  hardly  any  obligations    o SP  wouldn’t  be  granted  because  of  the  harsh  terms    

• Lumley  v  Wagner    o W  was  opera  singer.  Promised  she  would  only  sing  at  the  Globe  and  to  only  play  for  

this  one  guy.    o If  court  ordered  her  to  sing  in  Lumley’s  theatre  +  she  was  spiteful,  she  would  sing  

poorly.  o SP  not  possible  here.    

 

[3]  Mutuality:  Should  be  capable  of  being  awarded  to  both  parties    

Court  is  reluctant  to  do  so  but  has  discretion  to  grant  the  P  SP  even  though  not  available  to  the  D  

Examples  of  lack  of  mutuality:    

• P  has  already  performed  obligations    • P  has  not  performed  obligations  but  that  breach  can  be  compensated  for  in  damages    • D  is  guilty  of  fraud  or  unconscionable  conduct    

• Price  v  Strange    o P  wanted  to  rent  house  from  S.  S  was  a  tenant.  P  would  become  sub  lessee.    o Deal:  in  exchange  for  renta,  she  would:  

§ D’s  obligation:  grant  sub  lessee  to  price  § Price’s  obligation:  to  do  repairs  inside  and  out  

o Before  lease  was  granted,  she  kicked  him  out.  He  had  already  done  the  inside.  o She  ended  up  doing  the  outside.  o She  argued:  No  mutuality  –  nothing  left  for  him  to  do  o HELD:  allowed  him  in  to  do  the  work  àhe  thought  he  was  getting  sub-­‐lease.  

§ Created  an  equity  against  her.  It  wasn’t  his  fault  that  he  didn’t  do  the  outside:  she  did  that.    

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§ ORDERED  SP.      

[4]  Hardship:  Reluctant  to  order  SP  if  it  will  cause  undue  hardship  or  unfairness  to  the  D.      

Examples:    1. An  unfair  or  low  purchase  price  for  the  defendant  vendor  (Farrell  v  Bussell)    2. An  erroneous  valuation  fixed  the  price  of  the  contract  (Legal  &  General  Life  of  Australia  v  A  

Hudson)    3. Enforced  removal  of  a  physically  disabled  defendant  vendor  with  children  from  property  

where  she  was  able  to  receive  help  form  relative  and  friends  who  lived  close  by  (Patel  v  Ali)    4. The  land  purchased  by  the  D  would  be  subject  to  forfeiture  (Norton  v  Angus)    5. The  order  would  expose  the  defendant  to  prosecution  (Pottinger  v  Genge)    6. The  defendant  lessor  of  a  hotel  would  be  required  to  undertake  many  costly  repairs  and  pay  

taxes  without  receiving  rent  or  profit  for  many  months  while  the  plaintiff  retained  possession  (Dowsett  v  Reid)    

7. The  defendant  would  be  required  to  run  a  business  at  a  loss  (Cooperative  Insurance  Society  v  Argyll  Stores)    

8. The  defendant  would  be  forced  to  become  the  reluctant  proprietor  of  a  brothel  (Hope  v  Walters)    

9. The  defendant  would  be  required  to  maintain  a  joint  venture  after  an  “irretrievable  breakdown  of  relations”  (Cannavo  v  FCD)  

 

Longtom  v  Oberon  Shire  Council  –  quarry    

• Farm  land.  Council  had  rights  to  build  a  quarry.  They  gave  a  covenant:  “would  repair  and  restore  after  they  had  finished.”    

• It  was  going  to  cost  $360k.  Council  pleaded  hardship    • Mere  financial  hardship  not  enough.    • Something  more  required.    • P  couldn’t  see  the  quarry  from  the  house.  Value  of  farm  unaffected  by  quarry.  No  real  benefit  

to  having  it  filled  up.    • If  claimed  in  damages,  wouldn’t  get  much.  Court  saw  it  as  a  bargaining  chip.    

[5]  Ready  and  willing  to  perform:    

At  all  material  times,  P  must  be  ready  and  willing  to  perform  the  substance  of  the  contract.    

Mulkearns  v  Chandos  Developments    

P  generally  shows  that  P  is  not  able  and  willing  to  perform  by  showing  the  P  is  in  breach    

• Must  be  a  breach  of  an  essential  term  

Green  v  Somerville    

• Purchaser  of  land  arrived  at  settlement  without  enough  money  à  delayed  settlement  • Allowed  to  move  into  property  • Agreed  on  new  settlement  date    • She  didn’t  have  the  money  to  pay  the  interest.  She  said  she  wouldn’t  pay  the  interest  because  

she  paid  rent.    • HELD:  the  fact  that  relied  on  an  incorrect  interpretation  of  the  K  didn’t  make  her  

unwilling/not  ready  to  perform.    o QUANTUM:  paid  interest  less  a  deduction  for  the  rent  (ie  the  amount  already  paid)    

[6]  Unclean  hands:    

“Unmeritorious  conduct”    

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Only  conduct  that  relates  directly  to  the  equity  (equitable  remedy)  sought  

Examples:    

• Fraud  • Undue  influence  by  the  P    

Not  unmeritorious    

• Hard  bargaining  –  ‘sharp  practice’  • Innocent  misrepresentations    • Unconscionability    

[6]  Futility:    

• If  SP  futile  –  court  may  refuse  order    o Eg  restoring  property  that  will  be  demolished  next  month      

• If  D  establishes  that  the  performance  of  the  Contract  is  impossible  –  order  of  SP  refused.    

 

Iambic  v  Northwind  holdings    

• Not  futile  to  order  SP  of  a  K  to  sell  shared  in  a  private  company  where  the  purchaser  could  no  longer  afford  the  agreed  price.    

[7]  Delays:    

• Mere  delay  not  enough  unless  it  amounts  to  an:  o  Acquiescence  

§ your  conduct  appears  you’ve  accepted  the  circumstances    o  Lache  

§ your  delay  has  caused  some  sort  of  injustice    

Lamshed  v  Lamshed    

• Degree  of  promptness  depends  on  the  nature  of  case  and  circumstances.    • Waiting  6  years  =  too  long.    

Fitzgerald  v  Masters    

• Delay  of  26  years  =  not  too  long.    

   

Page 26: Remedies - Full Course Notes

RECTIFICATION    [1]  Written  instrument      

• Incl.  deeds,  insurance  policies,  bonds,  documents,  conveying  gifts    [2]  Mistake  by  the  parties  as  to  contents  or  effect      Traditionally  Maralinga  v  Major  Enterprises    

• Vendor  (seller)  of  property  said  to  auctioneer  “when  you  auction  my  property,  these  are  the  terms  I’m  willing  to  accept”    

o “I  will  take  the  first  $75,000  of  the  purchase  price  in  cash  and  the  balance,  I  will  grant  a  mortgage  on  (I  will  lend  the  money  to  the  buyer  over  a  period  of  3  years.)”    

• When  the  K  was  actually  written,  the  finance  option  was  not  reflected  in  the  document.  The  house  was  sold  for  $155,000  so  it  was  the  $80,000  that  would  have  been  under  the  3  year  mortgage.  

• At  the  time  the  contract  was  signed,  it  was  known  that  there  was  a  mistake  in  the  contract.  It  wasn’t  a  surprise  later.    

• The  buyer  didn’t  think  that  would  preclude  him  from  getting  the  mortgage.    • HELD:  rectification  not  granted  bc  it  was  a  mistake  with  regard  to  the  effect,  not  the  

contents.    

Modern  View:  It  would  have  also  covered  that  where  it  was  about  the  effect  of  the  contract.    

Commissioner  of  Stamp  

• Parties  intended  that  the  trust  deed  had  to  be  amended  so  the  company  would  become  an  income  beneficiary.    

• Document  drafted,  which  made  the  company  a  capital  beneficiary  and  the  company  incurred  some  additional  duties  as  a  result    

• It  was  an  issue  with  the  effect  of  the  way  it  was  drafted    • HELD:  rectification  ordered  to  fix  the  contract  to  reflect  the  true  intention  between  the  

parties.    

   Will  provide  rectification  as  remedy  for  unilateral  mistake  where  defendant  takes  advantage  unconscientiously  of  a  mistake:      Medsara  v  Sande  (2005)    

• 6  adjoining  lots  of  land  (w  6  different  owners)  • lots  bought  up  and  sold  to  a  developer  for  $5mil.  • Although  they  were  individually  owned,  all  of  the  individual  contracts  were  dependent  

on  the  others.    • Put  in  a  call  option  to  the  developer-­‐  meaning  he  could  call  up  his  option  to  buy  within  a  

certain  period  of  time.  If  he  didn’t  do  so,  the  owners  had  a  “put”  option,  meaning  they  would  put  it  to  him  to  buy  the  property  and  he  would  then  be  obliged.  Both  of  them  were  really  protected.    

• It  was  important  to  them  that  the  sale  would  be  concluded  by  a  certain  date.    • The  completion  date  was  a  year  later  than  what  they  had  really  wanted.    • The  undertone  of  this  cases  is  that  it  was  a  mistake  made  by  the  solicitors.    • Developer  (M)  knew  the  mistake  had  been  made.    • He  didn’t  make  the  mistake,  didn’t  intentionally  do  that  or  deceive  them  (eg  no  fraud  or  

deceit)  but  you  do  have  unconscionable  conduct    • HELD:  rectification  allowed  to  reflect  intention  of  the  parties  even  though  it  wasn’t  a  

common  mistake.    

 [3]  Intention  of  the  parties  as  to  what  instrument  should  contain  at  the  time  of  execution      

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Must  how  evidence  that  the  written  instrument  does  not  reflect  true  and  concurrent  intention  of  both  parties  at  the  time  of  execution  of  the  contract.  

• Not  the  time  of  negotiation    • The  term  must  have  been  actually  agreed  upon  and  either  not  included  or  incorrectly  

included      Slee  v  Warke    

• Option  to  lease  a  Victorian  hotel  • Negotiated  that  the  contract  would  contain  an  option  to  purchase  the  hotel,  but  the  

purchase  had  to  be  completed  within  the  first  year  of  the  rental.    • The  document  was  incorrectly  drafted  and  it  granted  the  option  whenever  (not  just  

within  the  first  year)    • Tenant  (W)  noticed  this.  She  though  that  the  owner  of  the  hotel  must  have  changed  his  

mind.  • At  the  time  of  the  execution  of  the  contract  the  two  parties  did  not  have  the  same  

intention-­‐  the  tenant’s  intention  was  to  execute  it  at  any  time,  whereas  the  intention  of  the  landlord  remained  the  same  –  that  it  should  only  be  exercisable  within  the  first  year.    

• Therefore,  because  they  did  not  have  the  same  intention…recificiation  not  ordered.    • Landlord  lost  out    • Need  concurrent  intention    

Antecedent  K  unnecessary    Previously  it  was  necessary  to  show  an  antecedent  (often  oral)  contract  –  but  approach  now  more  liberal.      Jocelyn  v  Nissen    

• J  and  his  wife  were  tenants    • Out  of  this  house  he  ran  a  car  rental  business  • He  ran  into  financial  difficulties  and  his  daughter  came  to  the  rescue    • She  bought  the  house  that  he  rented  so  that  her  dad  could  keep  on  running  the  business  

and  she  and  her  husband  would  live  in  the  top  part    • They  made  a  written  agreement  (dad  and  daughter)    • At  one  stage  her  mother  became  ill  and  the  father  spent  more  time  looking  after  that.  

The  daughter  became  more  involved  in  the  business  • Made  a  written  agreement  that  he  can  continue  living  in  there  forever  and  that  she  can  

take  over  the  car  rental  business.  • Daughter  paid  for  electricity  and  gas  and  the  father  basically  lived  there  for  free  • Somebody  had  a  look  at  agreement  and  told  her  that  she  was  not  obliged  to  continue  

paying  gas  and  electricity.  It  was  not  appropriately  drafted.  • Mr  J  approached  the  court  and  asked  for  a  rectification  fo  the  contract    • Daughter  argued  “we  had  no  antecedent  oral  contract  before  the  written  agreement  and  

therefore  you  cannot  get  rectification”    • HELD:  rectification  granted  because  there  was  some  outward  expression  of  the  intention  

of  the  parties.    • Still  have  to  show  the  common  intention  but  don’t  have  to  show  an  antecedent  

agreement.  

 NB:  Key  point  in  this  element:  intention  must  be  actual-­‐  not  presumed  and  there  must  be  convincing  proof  of  it.    [4]  Discretionary  factors            Refused  only  in  exceptional  circumstances    NO  RECTIFICATION  IF:    

• Contract  is  incapable  of  performance    • Contract  has  been  fully  performed    

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• Intention  is  illegal    • If  right  to  rescission  exists,  and  rescission  is  preferred  by  Pl  

o Ie  walking  away  from  it  –  if  it’s  available  and  the  parties  prefer  it,  the  court  won’t  grant  rectification.    

NB:  just  because  a  party  didn’t  read  the  contract  does  not  mean  that  rectification  is  not  available.        

Page 29: Remedies - Full Course Notes

 EQUITABLE  COMPENSATION      Eg.  if  you  wanted  to  donate  coins  to  someone  and  we  give  them  to  Louise  for  that  person’s  benefit.  Louise  does  something  different  with  the  money.  Here,  there’s  no  contract,  it’s  not  a  tort,  no  statutory  breach  –  buuut  it’s  a  breach  of  a  fiduciary  duty    

Exclusive  jurisdiction    

• Eg.  misapplication  of  trust  assets    • Breach  of  trust    

Youyand  v  Minters  (breach  of  trust)    

• Minters  held  half  a  mil  on  trust  for  Y  • Idea:  they  would  subscribe  to  shares  in  a  company  with  that  (so  they  would  be  the  

trustee  or  agent  when  they  bough  the  shares)  • They  released  the  amount  for  the  purchase  of  the  shares  in  two  instalments.  They  did  

that  without  getting  any  security  for  the  money  they  paid  over    • Breach  of  trust    • HELD:  equitable  compensation  

o It  was  because  of  the  actions  of  minters  that  the  money  was  lost  

[1]  Does  the  court  have  jurisdiction  for  Specific  Performance  or  injunction?          • They  can  be  awarded  in  the  place  of  or  in  addition  to  SP  or  injunction  

[2]  Discretionary  factors            • Equitable  damages  not  awarded  as  a  matter  of  right.    

Sayers  v  Collyer    

• Contract  between  the  two  for  the  rental  of  premises    • D  not  allowed  to  use  the  premises  for  the  purposes  of  a  bottle  shop    • He  did.  • For  3  years,  the  plaintiff  didn’t  complain  –  he  even  bought  beer  from  there  • Breach  of  K.  • Possibly  a  negative  covenant  in  the  contract  (could  get  an  injunction)    • HELD:  court  did  grant  injunction  because  of  the  acquiescence  –  accepted  the  breach  and  

done  nothing  about  it.  That  ruled  out  equitable  damages  for  the  same  reason    

Court  can  award  both    

• Can  be  awarded  in  addition  to  specific  relief  –but  duplication  of  relief  to  be  avoided  (Grant  v  Dawkins)    

Can  award  equitable  damages  instead  of  specific  relief  ‘  

Eg  if  specific  relief  has  become  impossible  during  the  litigation  process    

Damages  can  be  awarded  in  substitution  for  an  injunction,  IF:  (Shelfer  v  City  of  London  Electric  Lighting  Co)    

1. Pl’s  injury  to  legal  rights  is  small  2. Injury  is  capable  of  being  estimated  in  money  3. Injury  can  be  adequately  compensated  by  a  small  money  payment    4. Would  be  oppressive  on  D  in  the  case  to  grant  an  injunction    

[3]  Wrongful  act              Equitable  damages  can  be  awarded  for  ‘any  wrongful  act’  

• Torts  

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• Breaches  of  statutory  prohibitions    • Equitable  wrongs    

o Authorities  recognize  a  jurisdiction  for  breach  of  confidence  where  the  duty  of  confidence  was  purely  equitable  in  nature.    

Future  loss/injury  about  to  happen  

Industrial  Carpet  Society  v  Slack    

• Building  buildings  which  would  cut  out  the  light  when  they  were  completed    • Ie.  A  right  to  light  case  but  the  buildings  were  under  construction    • àcan’t  claim  in  CL  because    • Can  claim  in  equity.    

[3]  Assessment  of  damages              

Follows  CL  principles  of  assessment  in  concurrent/auxiliary  jurisdictions  (Johnson  v  Agrew)    

Governed  by  the  compensation  principle:  “to  put  P  back  into  the  position  he  would  have  been  in  had  it  not  been  for  the  wrong”    

Qualification:  damages  can  be  awarded  under  Lord  Cairns  Act  even  where  damages  at  CL  not  available.    

   

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RESCISSION What is it? Reversal of a transaction so that each party is restored to its original position. In CL (for contracts) and in Equity (gifts etc) Available if:

5. Contract (TEST 1) 6. Vitiating factor in formation (TEST 2) 7. An election to rescind the contract TEST 3 8. There are not bars to restitution (restitutio in integrum) TEST 4

[ELE 1]: Contract [x] and [y] had a contract. [ELE 2]: Vitiating factor [z – vitiating factor] is a wrong recognised in equity, which renders the contract voidable.

• Misrepresentation • Mistake • Duress à pressure eg holding gun to your head • Undue influence à overbearing manner to persuade someone • Unconscionable dealing àletting someone with a disability be taken advantage of

[ELE 3]: Election to rescind (i) choice available: [x] may choose to:

• terminate and claim damages; or • rescind and obtain restitution

As [x] [was] aware of the [facts allowing the rescission—vitiating factor of…] and of [his/her] right to rescind, [he/she] [may] elect to: rescind and obtain restitution. (or alternatively may terminate and claim damages) NB: you may be held to have elected to affirm even if you didn’t have knowledge of your right to terminate. (Khoury v Government Insurance Office of NSW) CL 205 (ii) election: If [x] chooses to rescind:

• [he/she] extinguishes the right to enforce contract or claim damages If [x] doesn’t elect to rescind or terminate:

• affirmation of the contract extinguishes [his/her] right to rescind it. o Actions can amount to affirmation

The words/conduct of election must be unequivocal. Once made it is irrevocable. (Sargent v ASL Developments) CL 204 (ii) timing: immediate rescission not necessary (as long as they haven’t affirmed before they try to rescind) [ELE 3]: Restitutio in integrum – bars to rescission – restoration to precontractual position Rescission relieves parties of obligations yet to be performed under the transaction, and reverses anything done under the transaction. Not possible if (bars to rescission)

• Property has been destroyed or has deteriorated • Property passed under the contract has been acquired by a bond fide 3rd party (because they

have acquired property rights in it.) Scope of rescission Complete restitution is not possible because [piano broken/business doesn’t exist] so will not be ordered under Common Law.

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However, if substantial restitution can be obtained, partial rescission may be ordered in equity where that is necessary to achieve what is “practically just” between the parties. (Maguire v Makaronis)

Rule: the court will limit the transaction to the extent that [P] would have been willing to enter it even without the misrepresentation (Vadasz v Pioneer Concrete).

Timing: restoration will be done as a the date of judgment, not as a the date of election (Alati v Kruger.) In equity:

• Alati v Kruger – shop case o K bought fruit business (ele 1 – contract to sell) o A misrepresented the potential turnover and didn’t mention that a supermarket was

about to open across the road (ele 2 – vitiating factor) o Made on average 30 pounds/wk rather than 100 pound/wk o K had to close it down o When applied for rescission there was no business that could be returned (restitutio

in integrum not possible at CL) o HELD:

§ the business closing was not Kruger’s fault § QUANTUM:

• take back the business and the money paid for it • deduct stock sold to third parties and the profits made • can make allowances for deterioration

• O’Sullivan v Management Agency and Music o O was a musician. Had K with MIM (ele 1 – contract) o MIM made many misreps about the contract (ele 2- vitiating factor) o When applied for rescission, contract had been performed (restitutio in integrum not

possible at CL) o HELD:

§ Rescission still possible § QUANTUM: got back the copyright in his songs and the master tapes. MIM

had to account for their profits but were given credit (incl small profit element) for their skill and labour in promoting the claimant and making a significant contribution to his success.

• Vadasz v Pioneer Concrete o V was a company director o Was asked to give a guarantee on company debts otherwise supplier would not

continue to supply (ele 1- contract) o He thought he was just guaranteeing future debts (ele 2 –vitiating factor: mistake) o The contract covered past and future debts o HELD:

§ The court only rescinded the contract to the extent of past indebtedness § He had promised to guarantee the future debts so he couldn’t “have his cake

and eat it too” – ie wouldn’t rescind it all • Maguire v Makaronis

o Maguire was Maks solicitor, who were buying a poultry farm o Maguire provided a link between Maks and the Commonwealth bank o Maguire set up a deal for them to get a mortgage o Maguire was a nominee (essentially acting for the bank) o Problem: a solicitor advising a client can’t become a party to the loan transaction and

he didn’t disclose it. o HELD:

§ Entitled to rescind. § Loan couldn’t be set aside because Maks would get a windfall. § So rescinded on term: mortgage to be repaid with interest. § Court rescinded the mortgage but put an obligation on them to pay back the

amount they borrowed.

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RESTITUTION What is it? A cause of action outside contract, tort or equity and a remedy Basically a profit-based/disgorgement remedy. Examples of “restitutions for wrong”

• Mistaken payment (CoA in restitution) o Remedy=give the money back (restitution)

• Breach of confidence leading to profit (CoA in equity) o Possible remedy = give up profits made (restitution/account of profits)

§ Account of profits are for equitable wrongs (wk 11 lecture) • Trespass leading to profit (CoA in tort for trespass to land)

o Possible remedy = give up the profits made (restitution) Restitutionary causes of action Money had and received

• Mistaken payments • Payments made under duress • Money paid and consideration failed totally (in a contract)

Quantum Meruit • Claim for payment “as much as it was worth” or reasonable value of services received –

where contract cannot be enforced. Restitution as a remedy

• A remedy for causes of action in restitution • Also for certain torts – certain recognised categories • Common law wrong

o Eg property wrongs § Such as in torts – trespass, detinue

o Unclear- fraud? Defamation? Assault?

PROPERTY WRONGS Pl can choose to have damages assessed on a restitution basis instead of a compensatory basis. [ELE 1]: [Def] must have been enriched at the expense of [Pl] It is irrelevant that [P] has not lost anything. [ELE 2]: Quantum Gain from unauthorised use of equipment (trespass to goods) Rule: if there’s no loss to P, restitution can be measured as equivalent rental of such a piece of equipment, which is the saved expense (Olwell v Nye & Nissen Co) Gain from trespass to land Rule: if there’s no loss to [P], restitution can be calculated by measuring the benefit to [D], which is the saved expense (Penarth Dock Engineering v Pounds) Quantum: is normally calculated by the market value of rent for the period of the trespass (Penarth Dock Engineering v Pounds).

Exception: if the market value is unjust in the circumstances, the court may make a subjective devaluation (Ministry of Defence v Ashman)

Gain from trespass to goods (detinue) Rule: P is entitled to the value of the benefit to the D without P having to prove any loss. NB: it is irrelevant that the goods retained may not have been hired out for the entire time if D did have them in his possession (as this is the loss to the P- and would be considered in an action for tort, but this is an action for restitution.) (Strand Electric & Engineering Co v Brisford) Olwell Nye & Nissen Co

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• Plaintiff sold their business to the D but terms of sale: P to retain ownership of egg-washing machine. P stored in a space next to the premises occupied by D.

• D took it out of storage without P’s knowledge and used if or the next 3 years. • Tort: trespass to property • No loss to P à there was no damage to the machine and he could still wash his eggs with it • HELD: even though there was no damage…

o BASIS OF CALC: § D made a saving in labour costs and not having to hire it from elsewhere by

using the egg washing machine § “the loss lies in the very essence of property- it’s exclusive use” § Awarded 10 pounds a week

Penarth Dock Engineering v Pounds

• P sold a pontoon to D • Terms of contract: pontoon to be moved away from the berth. D didn’t move it away. • Claim brought in trespass for mooring the pontoon onto P’s property • No loss to P • HELD: even though there was no damage… D infringed P’s exclusive right of use to land

o BASIC OF CALC: § How much they would have to pay elsewhere.

LJP Investments v Howard Chia Investments

• 2 adjoining properties • Asked permission from P to let scaffolding hang over. P said he would let them for $30,000 • D did it anyway without paying • No loss to P • HELD: initial amount quotes indicated the value that P placed on the infringement of his

right. o BASIS OF CALC:

§ If D had not infringed P’s right, D would have had to build a smaller a building or build further away from the fence.

Edwards v Lee’s Administration • P had part of cave on his property. So did D. But D had entrance. • D capitalised on this by building hotel and running tours. • P wanted compensation for trespass. • HELD:

o Rental not appropriate way to calculate the restitutionary remedy because “rental implies a long period of occupation.” Here, he just trespassed at regular intervals.

o BASIC OF CALC: § Real profits D made out of using their cave. § Brochures advertised all 31 caves, 12 of which were under P’s property § Remedy based on the licence- amount to be paid to waive the trespass. § Awarded cave profits proportionate to the number of the seeds under P’s

property

Ministry of Defence v Ashman • A married a guy who work for the RAF so they stayed in the RAF accommodation • He left her and she stayed on. Had nowhere else to go. • She didn’t pay rent for the time she stayed there (she did eventually move on.) • RULE: claim damages for loss (in trespass) or what the defendant benefitted • HELD:

o BASIC OF CALC: § it wasn’t the reduced rate they would normally charge the RAF staff, but the

market value (because this is what she would have had to pay elsewhere.) • in actual fact, she was eligible for housing commission so they

used a low rate. Strand Electric & Engineering Co v Brisford

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• D detained and used for its own purposes the P’s switchboards, which P otherwise hired out for profit.

• HELD: o BASIC OF CALC:

§ Market hiring charge for the whole 43 weeks of detention, without any deduction for the likelihood that the goods would otherwise have been left unhired for part of that time.

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ACCOUNT OF PROFITS What is it? Restitutionary in nature – disgorge a benefit (alternative to damages), and prevent unjust enrichment. Equitable remedy. EXCLUSIVE JURISDICTION Breach of trust or fiduciary duty Breach of confidence Trustee or judiciary to account for the entire profit made by reason of the breach (Consul Development v DPC Estates)

1. Is not penal or punitive 2. An equitable allowance as remuneration for work and skill (as long as not dishonest)

a. Only granted in cases where award of account of profits could not have effect of encouraging trustees to put themselves in a position of conflict of interest.

3. If trustee makes profit entirely by misapplication of trust money, beneficiary entitled to the entire profit

4. If profit made partially from trust money – beneficiary entitled to profit pro rate 5. If property purchased, account to be made even before property intended to be sold to realise

the profit Scott v Scott

• Mother died • Left a will: “house in which te husband and children were staing was to be

placed in trust with her husband having the right to stay in the house untl his death and then the assts would dissolve to the children.

• Husband remairre,d and sold the house • It was that house that had to be accounted for because the money from that

house was used

6. Acquisition of a business and its operation – allowances to be made for skills, effords property and resources of the Def.

AUXILIARY JURISDICTION Infringement of intellectual property rights [ELE 1]: An injunction must be capable of being awarded [ELE 2]: Account limited to profits derived from Def’s knowing infringement of P’s rights. Colbeam Palmer

• Awarded even though injunction not possible • Trademark stolen • During litigation, he assigned the trademark – his right in trademark expired • HELD: entitled to account of profits. Granted for period of time there was a knowing

infringement [ELE 3]: A discretionary award - discretionary factors apply [ELE 4]: Assessment of quantum: deductions

Even if ‘notoriously difficult’ and not capable of ‘mathematical exactitude’ – still needs to be awarded this remedy.

Court will consider deductions:

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1. Costs of the Def for manufacture and sale (Peter Pan Manufacturing Corp v Corsets Silhouette

a. Def bears onus b. Costs of materials, wages other ‘solely referable’ to manufacture and sale:

i. Not costs of overheads if unused capacity utilized ii. Costs of overhead if opportunity to manufacture non-infringing goods

forgone (Colbeam Palmer v Stock Affiliates)

Peter Pan

• Manufactured corsets • They had particulr way they manufactured. • During a visit to the US and they revealed some of their dieas in confidence • Silouhette manufactured these “U25 and U15” • Infringed • Made it clear how you would define profit: income derived from the business, less the cost.

You have to look at what portion of the profit the D is entitled to keep. Can deduct the cost of manufacture

2. Part of the profit that Def is entitled to keep

Apportionment of profits between owners and infringers

RULE: if another person’s IP is used, accountable for any profits made attributable to use of another’s property (Colbeam Palmer v Stock Affiliates)

TEST:

1) What is entire profit from sales of infringing goods? 2) What part of the profit is attributable to infringing use of the mark?

Dart Industries v Décor Corp – all sales attributable to infringement

• Household canisters that they manufactured • Distinguished their idea because it had a push button on the lid. It was stolen by Décor Corp. • The court stripped all of the profits – stripped 100%. No apportionment for the fact that a part

of the product was infringed.

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TPA [ELE 1]: Does TPA apply? [x] is a corporation. REMEDY: s 82(1) [1] Loss or damage

§ eg. loss of money/lawnmower didn’t work § any monetary, physical, economic loss (wider than tort), personal injury or

death § Must show ‘worse off’

Marks v GIO Aus Holdings:

• False rep that interest rate would be made at x% • Actually allowed variable interest rate to be made • D won the case because no loss was sustained because

that was still the best loan available.

[2] By the conduct of another person [3] Conduct in contravention of relevant provisions of Act

Purpose: place Pl in position that he would have occupied if wrong not committed.

CL principles imported:

• Compensatory • Causation • Remoteness • Mitigation • CN: - s 82(1B)

o Damages can be reduced proportionately unless D acted intentionally or fraudulently o No apportionment in Personal Injury or death claims o P’s gross negligence can sever the link between contravention and the P’s loss.

REMEDY: Damages - s 87

• ELEMENTS OF BOTH: o Cause of action

§ Resctrictive trade practices, unconscionable conduct, misleading and deceptive conduct, other consumer protection issues

o Causation § Practical or common-sense approach (March v Stramare) § If there’s an intervening cause à sufficient if D’s contravention was ‘a’

cause (need not be the sole cause) § S 82: right to a remedy § S 87: discretionary

o Damage not too remote § Damages for misleading and deceptive conduct usually similar to those of

tort of deceit § TEST: “All directly caused losses”

• Entitled to recover all loss flowing directly from the deceit/contravention of the TPA

• Likely test: ‘reasonably foreseeable in a general way’ –not sure if different from CL test

§ Pure economic loss is recoverable irrespective of damage to person or property

o Reasonable steps taken to mitigate damage § Duty on P to mitigate the loss or damage

o Contributory negligence § Mere CN is not sufficient to affect claim against D

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• Needs to be ‘grossly unreasonable conduct’ or ‘gross negligence’ or ‘extraordinary stupidity’

§ Apportionment possible to the extent the court thinks is ‘just and equitable’

s 87: provides additional cause of action and remedies

• S 87(1) – orders as court thinks appropriate o Much broader “smorgasboard” or remedies o Eg rescission, dismantling contracts

Difference under 87:

• Can give any order • It’s discretionary • For loss actually suffered and likely to be suffered • Can be for part of a loss

S 82 s 87 Creates both a right and a remedy All remedies are discretionary – but discretion is

wide with remedies not available under CL or Equity

Damage is the gist of the action Order can be made for loss suffered but also loss likely suffered

Gives a right to complete recovery of loss or damage

Relief may be given to only compensate for part of the loss or damage

Does not have the ability to reduce or prevent likely loss

ASSESSMENT OF DAMAGES (FOR BOTH)

• Put P in same position as would have been has breach of Act not occurred • No double recovery • Lump sum rule does not necessarily apply • Structured settlements – s 87ZC • Date of assessment: likely date of breach or date of damage

o And ‘all matters known at a later date’ o Because in many instances the loss only occurs after the contravention (so would be

taken from the time that loss occurs) • Expectation loss not available • Loss of opportunity can be recovered • Mental stress • Reputation

o In actions similar to ‘passing off’ and ‘defamation’ • Interest

o Possible • Exemplary and aggravated damages – s 87ZB • Limitation period: 6 years from the date of cause of action accrued

TORT OF DECEIT

Tantamount to fraud

1) Factual misrepresentation 2) Person who made the misrep knew it was false

a. Recklessly – indifferent to the truth

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b. No belief in the truth 3) Intended P to rely on it 4) P did rely to his detriment.

REMEDY: RESCISSION

• Rescission for vitiating factor in contract formation – s 87(2)(ba) o Through an order refusing to enforce any or all o the provisions of a contract made in

contravention of the TPA o Guided by equitable principles of rescission

• NB: s 87 is very flexible. Can combine damages order with order for rectification; can dismantle contractual arrangements; can vary part of the contract, can return property; can repair goods or services; can make order against 3rd parties

REMEDY: SPECIFIC PERFORMANCE

• Mandatory injunction – s 80(5) only possibility o Where loss has been suffered or is likely to be suffered.

• Object is to compensate, prevent or reduce the loss (different from equitable remedy)

REMEDY: INJUNCTIONS

• S 80 • Prohibitory and mandatory • Aim is protection of the public • Any person can apply for an injunction • Order can be given irrespective of whether or not damages would be adequate • Equitable principles not relevant

REMEDY: Mareva order

• Available under s 87A