Remedies for Breach of Contract

A contract can be discharged by breaching a contract. There are four remedies for breach of contract, which are damages, specific performance, injunction and quantum meruit. Lets see what is the contents of these remedies:

Damages
Any breach of contract will entitle the injured party to damages. However, if the injured party has suffered no real loss these damages will be nominal say rm 5, any costs may not be recoverable. The primary purpose of contract damages is to put the injured party in the financial position he would have been in if the contract had been properly performed. Two steps are necessary to achieve this. First, it must be asked whether or not the loss it too remote for damages in respect of it to be recoverable at all. Then, if the loss is not too remote, damages must be quantified.See the case of Victorial Laundry v Newman Industries[1949]

Specific Performance
Specific performance is a court order requiring a person to perform his contract. If the party disobey this order he will be in contempt of court. For example, if A agrees to sell a painting to B but then refuces to hand it over, a decree of specific performance would order A to hand the paiting over. If A still refused to do so, he would be in contempt of court and would be liable to a fine or imprisonment. However, a party will not be protected against specific performance merely because he has made a bad deal. As long as the other party behaved fairly specific performance can be ordered. See the case of Mountford v Scott(1975).

Injunction
It is a court order requiring a person to do or not to do a certain thing. A person who refuses to obey an injunction will be in contempt of court. The granting of an injunction, to prevent an action which would be deliberately cause a breach of contract, is an equitable remedy for breach of contract. It is, however not ordered where damages would be an adequate remedy.See the case of Page one records ltd v Britton [1968].

Quantum Meriut
A party to a contract may occasionally claim for payment on a quantum meruit. Such a claim will be for work done, paying the amount that is deserved. A quantum meriut can only be claimed in the following circumstances:
@if the other party prevented completion of the contract.
@work has been done and accepted under a void or partially performed contract
@contract did not expressly provide what the remuneration should be.
If it were not for the possibility of a claim on a quamtum meriut one of the parties to the contract might be unjustly enriched.

Posted by ahkeenz at 7:18 PM