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Remedies

Once a court decides that there has been a breach of contract, it must then judge how the party in breach must compensate the other party. The usual award is damages - monetary compensation. The court must be satisfied that there was a contract, that one party is in breach, and that the other party has suffered some loss because of the breach. In addition to financial loss a plaintiff sometimes tries to claim damages for mental distress caused by the breach of contract. Such claims are less successful in Britain than in the US, except for holiday contracts (though often successful in tort actions).

A court will award damages only for loss closely connected with the defendant's breach. For example, in the 1949 English case of Victoria Laundry vs. Newman Industries, the defendants were five months late in delivering a new boiler for the laundry. The laundry claimed damages first for profits they would probably have made by being able to increase their regular laundry customers if they had had the boiler on time; and second, for profits they might have made if the boiler had enabled them to take on new dyeing contracts. The court decided that the first claim was reasonable but that the second was too remote. Remoteness is an important concept in both contract and tort.

In deciding just how much in damages to award,English and American courts try to put the plaintiff into the same financial position that he would have been in if the defendant had carried out the contract Instead of damages, a plaintiff sometimes asks the court to force the other contractor to carry out the contract. In English law this is called specific performance. The court will not agree to do this if it causes fcnardship to the defendant, however, or if it is no longer possible or practical to carry Out the contract. Sometimes the court decides to award damages instead ol specific performance, and sometimes it awards both. A plaintiff may also ask the court to award an injunction against the defendant, that is, to order the defendant not to do something which would be in breach of contract. Specific performance and injunctions are remedies which were developed by the courts of equity because of inadequacies in the common law courts.

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