COUNCIL OF LEGAL EDUCATION

NORMAN MANLEY LAW SCHOOL

REMEDIES MANUAL

Breach of Contract

Where the cause of action is a breach of contract there are two possible
remedies:
1) The victim of the breach could require the contract to be
specifically enforced. However, if specific performance is not possible or not
permissible then;
2) Damages would be an appropriate remedy
Therefore, a victim of breach must always claim specific performance and
damages.

Measure of damages for breach of contract

1) The Normal Measure of Damages for Breach of Contract
To put the Claimant, as far as money can do so, back in the position he/she
would have been in had the contract been performed according to its terms
NB. This measure gives the Claimant the benefit of the loss of bargain that was
contracted for.

2) The Extra-ordinary/Exceptional Measure of Damages for Breach of Contract

To put the Claimant, as far as money can do so, back in the position that he had
occupied before the contract was entered into
NB. This measure precludes any recovery of the loss of bargain and is designed to
restore to the claimant expenses incurred. And such recovery is subject to
considerations of remoteness as established in Hadley v Baxendale.

Sale of Land

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The normal and exceptional measures are applied to contracts for the sale and
purchase of interests in land, be it freehold or leasehold interests.

Default by Purchaser/Buyer
Where there is an agreement for the sale or purchase of land and there is default,
if the purchaser is the defaulting party the normal measure is applicable. In such
case a number of remedies are open to the seller/vendor:
a) he may resort to the equitable remedy of specific performance
b) he may treat the breach as discharging the contract, forfeit any deposit but
restore any payments made on account of the purchase price and proceed to
deal with the property as he desires. Each particular contract must be construed to
ascertain whether money already paid by the buyer is a deposit in earnest or
guarantee of performance and therefore to be forfeited, or a part payment of the
price and therefore to be restored.
c) He may seek damages for breach of contract

Default by Seller/Vendor
Where the breaching party is the vendor, if he breaches the agreement for a
reason other than a title related reason, then the normal measure applies and the
purchaser can get damages or specific performance. But if he breaches the
agreement by selling to some other person, the purchaser cannot get specific
performance if the property was sold to a bona fide purchaser. However, the
normal measure would apply because the vendor would have put it out of his
power to perform and so he cannot say I cant pass property because of
defective title.

The Rule in *Bain v Fothergill

The principle is this, Where on a contract for the sale of land the vendor, in the
absence of any fraud or bad faith, is unable to make a good title, the purchaser is
not entitled to recover damages for the loss of bargain. He can only recover the
expenses he has incurred in investigating title and repayment of the deposit where
he has paid one.

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Facts
The defendants, lessees of a mining royalty who had covenanted not to assign
without the consent of the lessors, agreed to sell their interest therein to the
plaintiffs. The plaintiffs paid to the defendants a deposit, but the lessors, after some
negotiations, refused their consent to the sale. In an action by the plaintiffs to
recover the deposit, the expenses incident to the investigation of the defendants
title and also damages for the loss of their bargain.

Held: the plaintiffs were only entitled to recover their deposit and the expenses
they had incurred in investigating the defendants title.
So, where the vendor is unable to convey a good title because of some defect in
the title, this defect in title excuses the vendor and as such the vendor would only
be liable to return to the claimant all the pre-contractual expenses subject to the
principle of remoteness.

Keen v Mear
Also, in this case where the land was owned by the seller jointly with his brother as
partners and he expected his brother, and did his best to persuade his brother, to
give his consent to the completion of the sale, the rule in Bain v Fothergill was also
applied.

Exceptions to the Rule in Bain v Fothergill

1) Where the vendor practiced fraud or;
2) Where the vendor is guilty of bad faith, the rule will not apply and the
normal measure of damages will be applicable.

Fraud: Misrepresentation of belief by the seller that he had, or could obtain before
the due completion, a good title .

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If the seller has induced the purchaser to contract by means of fraudulent
misrepresentation, the purchaser can recover damages for loss of his bargain. He
may also bring an action in the tort of deceit for damages.

Two situations of bad faith:

1) Deliberate loss of title between contract and completion date.
If the owner of land with a good title, after contracting to sell it to the plaintiff,
resells and conveys to another instead, the plaintiff can recover damages for loss
of bargain.

2) Failure to attempt to obtain consent of a third party necessary for perfection of

title
Where the defendant has taken no steps to obtain the consent of a third party
necessary for the perfection of title which, had it been requested, might have
been given, it has been held that the case is outside the rule in Bain v Fothergill
and the defendant is liable to the ordinary measure of damages for breach of
contract. This was established in the cases of:

Day v Singleton
In this case the sale was of a leasehold property and the consent of the lessor was
required to validate the assignment. The lessee, i.e. the seller, never attempted to
obtain this consent. Lindley L.J. in the Court of Appeal said: that the rule will not
apply where a vendor can make good title but will not, or will not do what he can
do and ought to do in order to obtain one

And most importantly see the Jamaican case below where bad faith brought the
case outside the rule in Bain v Fothergill:
*Howard Lamb and Maxine Lamb v Helen Coulthard

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The respondent and her daughter were joint owners of premises in Barbican, St
Andrew. The land was subject to a mortgage. The appellant and the respondent
entered a written agreement for the sale of the said premises and the appellant
paid a deposit of 10% purchase price. The respondent failed to complete the sale
on the ground that there was another owner. When sued the respondents
defence was a defect in title, thereby asking that the exceptional measure based
on the principle in Bain v Fothergill should apply.
At first instance the respondent succeeded. The appellant appealed arguing that
Bain v Fothergill was inapplicable because at the time of the agreement of sale
the land was subject to a mortgage. The owners were in default of payment and
the land was about to be placed on sale by auction. That the respondent took
pre-emptive strike and agreed to sell in then retracted the offer after having used
the 10% to pay arrears on mortgage installments.

Wolfe J.A. (unanimously with members of the Court of Appeal) held:

1) Where the title is a registered title the doctrine of Bain v Fothergill would not
normally apply
2) The vendor acted in bad faith.
According to Wolfe J.A. this was plainly evidence of bad faith. It is evident that the
dilemma with which the vendor was faced, namely, forced sale of her property
led her to enter into the agreement with the appellants without disclosing that her
daughter was a joint owner of the property that the property was also in the name
of her daughter. In such circumstances of bad faith the rule was inapplicable and
so the appellants were entitled to damages for loss of bargain.

Assessment of Damages under Normal Measure - Basic and Consequential Loss

Basic Loss at Law
One must take account of the value of the premises at the date of the contract
and the value at the breached date. Thus the basic loss is calculated by
subtracting contract price from the market value of the property at the breached

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date. It is also advisable that the purchaser request a valuation of the property at
the breached date in order to get the true market value as at that date.
Basic Loss in Equity
Where the purchaser is claiming specific performance and the vendor is unable or
unwilling to perform, for example where the vendor has put it out of his power to
perform the contract or where there is a willful refusal to perform, the purchaser
may be award damages in lieu of specific performance. Even if there is a decree
the purchaser may still get damages in equity. Here the basic loss will be the value
of the property at the date of judgment less the value at the time of contract.

Consequential Loss
The purchaser may have suffered consequential losses as a result of the breach of
contract. He may, for example, have lost profits from the breach in the context
where the purchaser had agreed to sell the premises to a sub-buyer before the
contract was made or may have bought the premises to be sub-divided and sold
or to construct a condominium. However, if he incurs any losses on such sub-
contracts he can only recover those losses which were not too remote. The
principle in Hadley v Baxendale applies and so the purchaser can only recover the
losses which were in contemplation of the parties at the time of the contract.

*Diamond v Campbell-Jones
The buyer of the leasehold of a London town house, who was a dealer in real
estate and already bought and converted several houses, failed to recover as
damages, in an action against the repudiating seller, the profit that he would have
made upon the conversion of the house into flats and offices. Not only was it found
that the defendant seller had no actual knowledge at the time of making of the
contract as to how the plaintiff proposed to deal with the house, but the court was
unprepared to impute any such knowledge to him.
Special circumstances, said Buckley J are necessary to justify imputing to a
vendor of land a knowledge that the purchaser intends to use it in any particular
manner.

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In contrast see *Cottrill v Steyning & Littlehampton Building Society
The defendants granted the plaintiff an option to purchase certain land, the
option to be exercised as soon as reasonably possible after the plaintiff, with a
view to permitting his intended development of the land, had obtained planning
permission for houses and flats together with the recession of a tree preservation
order. After the plaintiffs had satisfied these requirements, the defendants in
breach of contract sold the land to a third party, and the court held that since,
there could be no doubt that the defendants knew that the plaintiff intended to
develop the land, special circumstances were established which entitled the
plaintiff to have the damages assessed by reference to the profits which both
parties contemplated he would make.

On the other hand see:

*Seven Seas Properties Ltd v Al-Essa and another(No2)
The defendant/vendor owned two leasehold properties which were offered to the
plaintiffs purchaser for L1.5m. The plaintiffs/purchaser were interested in
purchasing the properties for the purpose of a quick resale at a profit and found a
sub-purchaser willing to purchase for L1,635,000 but kept to themselves their
intention to sell on and it was only after the contracts for sale between the plaintiffs
and the defendants and between the plaintiffs and the sub-purchasers had been
signed that the defendants learnt of the resale contract. The defendants believed
that they were underpaid and refused to complete the contract with the result
that the plaintiffs were unable to complete the resale contract. The sub-purchaser
brought sued purchaser for damages and the purchaser in turn sued the vendor
specific performance.

Specific performance was granted to the purchaser and on the same day sold
property to the sub-purchaser for L1,375,000. On the inquiry as to damages the
purchaser claimed loss of profits under the contract for resale.

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Held
A plaintiff was entitled to recover all damages for breach of contract which at the
date of the contract the defaulting party was on notice might be occasioned by
the breach and which was a liability for which he could fairly be held, in entering
into the contract, to have accepted the risk. However, the defaulting party could
only be held to be on notice of the purpose and intent of the plaintiff in entering
into the contract with him . A plaintiff claiming to recover from the defaulting
party losses arising under a sub-contract had to establish that the defendant was
on notice of the existence, at the date of the contract, of the plaintiffs purpose
and intent to enter into further contract which was dependent for its fulfillment on
the due performance by the defendant of the first contract. It was not sufficient
for the plaintiff to establish that the conclusion of a sub-contract was an available
option. In order for the defendants to be liable to the plaintiffs it was necessary for
the defendants to have been aware of the plaintiffs contract to sell the property
at a profit. Since the plaintiffs had deliberately withheld from the defendants the
fact that they intended to sell on, the loss suffered by the plaintiffs in respect of the
contract for resale was not within the contemplation of the parties. The plaintiffs
claim for damages arising out of the resale would therefore be dismissed. Hadley
applied.

COMPENSATORY DAMAGES

The remedy concerned to achieve compensation for torts and breach of contract
is compensatory damages. This is almost always a common law remedy although
equitable compensatory damages may be awarded in addition to, or in
substitution for, specific performance or an injunction for a tort or a breach of
contract.

An award of compensatory damages will be made where a claimant has proved

his/her cause of action and loss and the tribunal has applied various measures and
subsidiary rules (remoteness and mitigation rules) to work out the quantum.

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Measure of Damages
In resolving a problem one must always start with a statement of the general
principle concerning the measure of damages in tort or contract. This is crucial
because the basis for determining compensation is the measure of damages. The
measure of damages is the principle of law which is invariably applied as the basis
for working out the quantum and the quantum is the amount of damages arrived
at the end of the assessment process. The cause of action is also very important
because it will determine the statement of the measure of damages.

Measure in Tort
To put the Claimant, as far as money can do so, back in the position he/she had
occupied before the tort was committed

Measure in Contract
There are two measures, the normal and the extra-ordinary measure.

Normal Measure

To put the Claimant, as far as money can do so, back in the position he/she
would have been in had the contract been performed according to its terms
NB. This measure gives the Claimant the benefit of the loss of bargain that was
contracted for.

Extra-ordinary Measure
To put the Claimant, as far as money can do so, back in the position that he had
occupied before the contract was entered into
NB. This measure precludes any recovery of the loss of bargain and is designed to
restore to the claimant expenses incurred prior to forming the contract.

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PRINCIPLES LIMITING COMPENSATORY DAMAGES

REMOTENESS
A claimant cannot succeed if the loss was too remote from the breach of duty.
The tests formulated for deciding on this have centered on whether the loss was (in
contract) reasonably contemplated or (in tort) reasonably foreseeable by the
defendant.

Remoteness in Contract: the rule in Hadley v Baxendale

Recovery of losses is limited by what was in the contemplation of the parties at the
time of the contract.

The claimants mill was brought to a standstill by a broken crank-shaft. The

claimant engaged the defendant carrier to take it to Greenwich as a pattern for a
new one, but in breach of contract the defendant delayed delivery. The claimant
sought damages for loss of profit arising from the fact that the mill was stopped for
longer than it would have been if there had been no delay. All the carrier knew
was that the article to be carried was the broken shaft of a mill and that the
plaintiffs were millers of that mill.

The court held that the loss of profit was too remote and that therefore the carriers
were not liable for it. The test for remoteness was laid down in two rules by
Alderson B. He said:
where two parties have made a contract which one of them has broken, the
damages which the other party ought to receive in respect of such breach of
contract, should be such as may fairly and reasonably be considered, either
arising naturally, i.e. according to the usual course of things from such breach of
contract itself, or such as may reasonably be supposed to have been in the

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contemplation of both parties, at the time they made the contract as the
probable result of the breach of it

Victoria Laundry (Windsor) Ltd v Newman Industries Ltd

The principle in Hadley was applied here. The claimants, launderers and dyers,
decided to extend their business and contracted to buy a boiler from the
defendants. The defendants knew that the claimants wanted the boiler for
immediate use in their business, but in breach of contract delivered the boiler five
months late. The claimants sought damages for the loss of profits that would have
resulted from using the boiler, including damages for the exceptional loss of profits
that they would have been able to gain from contracts made with the Ministry of
supply.

The Court of Appeal held applying Hadley, that damages should be awarded for
ordinary loss of profits but not for the exceptional loss of profits. The exceptional
profits were too remote because they did not arise naturally and were not in the
contemplation of the parties at the time of contracting since the defendants knew
nothing about the Ministry of Supply contracts.

Remoteness in Tort
The test for remoteness in tort is laid down by the Privy Council in The Wagon
Mound No.1. This case establishes that the consequences are too remote if a
reasonable man would not have foreseen them. Here the defendants carelessly
discharged oil from their ship into a harbour. Over two days later, molten metal
from the claimants welding operations on the wharf set fire to the oil on the water.
The claimants wharf was severely damaged.

The Privy Council held that the defendants were not liable in negligence because,
while they could have reasonably foreseen damage to the wharf by fouling, they
could not have reasonably foreseen that the wharf would be damaged by fire
when they carelessly discharged the oil. Viscount Simonds said: It is the foresight
of the reasonable man which alone can determine responsibility.

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Application of the Wagon Mound test
Once the damage was reasonably foreseeable damages is recoverable.
Note the following: -

(i) So long as the type of physical damage which has resulted was
reasonably foreseeable at the time of the negligence, neither the actual manner
in which it came about nor its actual extent needs to have been reasonably
foreseeable.

See Hughes v Lord Advocate - Post office workmen left an open manhole, in which
they had been working, covered by a shelter tent and surrounded by warning
paraffin lamps. P, aged 8, was playing with one of the lamps when he stumbled
over it and was knocked into the hole. An explosion followed and P was thrown
into the manhole and was severely burned.
- Ds were held liable because while it was not reasonably foreseeable that a child
would be burned as a result of the actual sequence of events that had occurred,
it was reasonably foreseeable that a child could be burned by playing with one of
the gas-lamps. Nor did it matter that the burns were more serious than those that
were reasonably foreseeable.
- The reasonable foreseeability test is therefore applied to limit the kind of damage
recoverable but not the extent of the damage recoverable.

(ii)The tortfeasor must take his victim as he finds him - 'thin skull' principle.

This is considered to be an exception to the principle of remoteness. The

defendant must take his victim in the physical condition he finds him in. A good
example of this principle is Smith v Leech Brain & Co Ltd in which a negligently-
inflicted burn on the claimants husbands lip resulted in him dying of cancer. He

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was suffering from pre-malignant cancer and this was caused to develop by the
burn. The defendants were held liable for his death.

Note Lecturers instructions: that the claimant would have to concede that a burn
on the lip which resulted in the claimant dying of cancer would be too remote.
However, the exception applies and so the defendant would be liable.

Secondary Parties
Psychiatric trauma or nervous shock

Limitations beyond reasonable foreseeability are also placed on claims for

psychiatric trauma or nervous shock because it may affect a wide range of
people beyond the direct victim of the D's tortuous conduct.

In Alcock v Chief Constable of South Yorkshire, the 10 appellants had suffered

psychiatric trauma as a result of the disaster in 1989 at Hillsborough Stadium,
Sheffield, in which, as a result of admitted negligence of the defendants, some 95
people were crushed to death and over 400 physically injured. None of the
appellants had suffered any physical injury, nor been in danger, most of them were
not at the ground, though they saw part of the events on television. All of the
appeals failed.

The House of Lords stated that claims for nervous shock are to be controlled by
reference to three elements:
(i)The class of persons whose claims should be recognised-
The House of Lords rejected arbitrary qualifications by reference to particular
relationships, such as husband and wife or parent and child. Lord Keith pointed out
that the kinds of relationships which may involve close ties of love and affection
are numerous and that it is the existence of such close ties which leads to mental
disturbance when the loved one suffers a catastrophe.

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(ii) The test should simply be reasonable foreseeability subject to qualifications that
a sufficiently close relationship of affection will readily be presumed in the case of
close relatives and the claims of remoter relatives will be scrutinised with care.

(iii) The proximity of such persons to the accident

There must be sufficient proximity of time and place to the event leading to the
psychiatric trauma. "Proximity" has its primary meaning of nearness in space and
relationship, but is extended to cover the "immediate aftermath" of the event.

Bourhill v Young
In this case Mrs. Bourhill was on a tram. She got off and saw Young, a motorcyclist,
who passed the tram. Some 50feet further away Young crashed in a car and was
killed. He was negligent. After Youngs body had been removed Mrs Bourhill
approached the site and saw blood on the road. She alleged that she suffered
nervous shock as a result of the accident and gave birth to a stillborn child a
month later. Assuming Young would have been liable to the owner of the car into
which he crashed, could he also be liable to Mrs Bourhill?

Held No duty was owed to the Mrs Bourhill and so she could not sue Young in
negligence.. Lord Russell said:
.. a man is not liable for negligence in the air. The liability only arises where there
is a duty of care and where failure in that duty had caused damage. Such a duty
only arises towards those individuals of whom it may be reasonably anticipated
that they will be affected by the act which constitutes the alleged breach.

In this case Mrs Bourhill was unforeseeable; she was 50 feet away and was not
within vision of Young but was standing behind the tramcar. His speed in no way
endangered her. He could, therefore, not have reasonably anticipated that, if he
came into collision with a vehicle the resultant noise would cause physical injury by
shock to a person standing behind the tramcar. He owed no duty to Mrs Bourhill
and was not guilty of any negligence in relation to her.

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MITIGATION OF DAMAGE

This is another principle limiting the recoverability of compensatory damages. A

claimant cannot succeed if subsequent to the tort or breach of contract he or she
could reasonably have avoided the loss.

Object of the doctrine of mitigation

The object of the doctrine of mitigation is to relieve the defendant from liability for
those consequences of the injury which the plaintiff avoided or might reasonably
have avoided.

1. THE CLAIMANT MUST ACT REASONABLY

He cannot recover for avoidable losses. This well-established rule was laid down by
Viscount Haldane L.C. in the leading case of *British Westinghouse Co. v
Underground Ry where he said:
The fundamental basis is thus compensation for pecuniary loss naturally flowing
from the breach; but this first principle is qualified by a second, which imposes on a
plaintiff the duty of taking all reasonable steps to mitigate the loss consequent on
the breach, and debars him from claiming any part of the damage which is due to
his neglect to take such steps.

General points regarding this doctrine as stated in British Westinghouse

(i)It applies to contract and tort

Lord Haldane referred only to pecuniary loss presumably he was dealing with a
breach of contract and not a tort. However, the principle applies equally to non-
pecuniary losses and to tort, as evident in *McAuley v London Transport
Executive.(see facts below)

(ii)The question of duty

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Lord Haldane referred to the plaintiff as having a duty to mitigate. However, there
is no duty which is actionable or owed to anyone by the plaintiff. Pearson L.J.
in *Darbyshire v Warren gave the proper analysis when he said:

It is important to appreciate the true nature of the so-called duty to mitigate the
loss or duty to minimize the damage. The plaintiff is not under any contractual
obligation to adopt the cheaper method: if he wishes to adopt the more
expensive method, he is at liberty to do so and by doing so he commits no wrong
against the defendant or anyone else. The true meaning is that the plaintiff is not
entitled to charge the defendant by way of damages with any greater sum than
that which he reasonably needs to expend for the purpose of making good the
loss. In short, he is fully entitled to be as extravagant as he pleases but not at the
expense of the defendant.

(iii)The question of onus

The onus of proof on the issue of mitigation is on the defendant to show that the
plaintiff failed to mitigate or did not act reasonably in mitigating his losses.

(iv)The need to mitigate before contractual breach

A plaintiff need take no steps in mitigation until a wrong has been committed
against him. For example, where a party to a contract repudiates it, the other
party has an option to accept the repudiation. If he does not accept it there is still
no breach of contract, and the contract subsists for the benefit of both parties and
no need to mitigate arises.

Repudiation accepted
On the other hand, if the repudiation is accepted this results in an anticipatory
breach of contract in respect of which suit can be brought at once for damages,
and, although damages are to be assessed from the date when the defendant
ought to have performed the contract, this amount is subject to being cut down if
the plaintiff fails to mitigate after his acceptance of the repudiation. The law is
illustrated for employment contracts by:

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Schindler v Northern Raincoat Co.
Where the defendant company, in the course of the plaintiffs employment by
them under a 10-year agreement, wrongfully repudiated the contract by informing
the plaintiff that they would not continue to require his services as from an
apparently unspecified later date, but only removed him from office at an
extraordinary general meeting of the company some months after his repudiation.

It was held that the plaintiff had no duty to mitigate by accepting alternative offers
of employment between the defendants wrongful repudiation and their removal
of him from office because during this period there had been no breach: the
plaintiff had not accepted the repudiation.

The need to mitigate by discontinuing contractual performance

Nor, it seems, need a plaintiff take steps to mitigate loss, even after the
defendants performance of the contract which he has repudiated falls due, by
accepting the repudiation and suing for damages. He may instead, where he can
do so without the defendants assistance, perform his side of the contract and
claim in debt for the contract price. Even if this involves incurring expense in the
performance of the contract which, in face of the defendants repudiation, is
rendered useless, the plaintiff is not required to minimize the loss by accepting the
repudiation and suing for damages. This conclusion was reached in:

White and Carter v McGregor

The plaintiffs, advertising agents, contracted with the sales manager of the
defendant garage proprietor to display on litter bins advertisements for the
defendants garage for three years. The defendant, on hearing of the contract,
wrote at once to the plaintiffs to cancel it but the plaintiffs refused, displayed the
advertisements in accordance with the agreement, and sued for the contract,
price.

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The House of Lords, by a majority, held that the plaintiffs were entitled to carry out
the contract and claim in debt for the price, and were not to accept the
repudiation and sue for damages. However, that the plaintiffs right to ignore
repudiation and carry on with performance may not be absolute. Lord Reid in
instant case said:

..It may well be that, if it can be shown that a person has no legitimate interest,
financial or otherwise, in performing the contract rather than claiming damages,
he ought not to be allowed to saddle the other party with an additional burden
with no benefit to himself

In that case, however, the defendant had not attempted to prove that the plaintiff
had no legitimate interest in completing performance, and it was improbable,
added Lord Reid, that any such case would have been made out.

2. STANDARD OF REASONABLENESS
The standard required of the plaintiff is that which a reasonable and prudent
person might in the ordinary conduct of business properly have taken. Whether
the plaintiff had acted reasonable or not is a question of fact for the trial judge,
taking into account all the circumstances of the particular case. The onus is on the
defendant to show that what the plaintiff did or failed to do was unreasonable.

The criterion as stated by Viscount Haldane in British Westinghouse is that the

plaintiff is not under any obligation to do anything other than in the ordinary
course of business. As such:

(i.) A plaintiff need not risk his person too far in the hands of surgeons.

See *Selvanayagam v University of the West Indies

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In this case the Privy Council held on the facts before them that the refusal of a
physically injured plaintiff to undergo a dangerous and risky surgical operation did
not constitute a failure to mitigate.
The facts were that the appellant, a professor of civil engineering at the UWI in
Trinidad, was walking along a passageway in a building on the campus when he
fell into a trench. The appellant suffered severe and painful injuries to his left foot
and ankle, his neck and his left shoulder, elbow and hip. Regarding his neck injury
he consulted a neuro-surgeon who found a serious condition: two herniated (in
laymans language slipped) discs and diabetes (a random blood sugar count of
240 mg%). The doctor believed that surgical therapy to the neck would help and
that if there were no operation, the neck would get worse. It would be a major
operation but not very risky. The doctor also informed the appellant of the risks of
infection which a diabetic would run and told him that it is for him to decide on
whether he should have the operation or not. The appellant rejected the medical
recommendation in favour of the surgery.

The Privy Council, approved the first instance decision and, held that the
appellant acted reasonably in refusing to undergo an operation which, if
successful, would have probably regained for him within a few months some 80%
of his mobility, thereby enabling him to resume his working life as a highly qualified
professional engineer. His failure to mitigate did not have the effect of discounting
the damages to be awarded.

*McAuley v London Transport Executive.

On the other hand, where the operation would not be regarded by reasonable
men as a risky one, then a refusal to allow it will be a failure to mitigate on the part
of the plaintiff; such result was reached by the Court of Appeal in McAuley.
Facts
The plaintiff sustained injuries during the course of his employment with London
Transport executive. His left wrist was cut and there was severance of the ulnar
nerve. Movement of his fingers was restricted and he was developing a deformity.

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The plaintiff was advised by doctors retained by the defendant to have an
operation which had 90% chance of successfully restoring mass action of his fingers
and 35% chance of restoring the fine movement of his fingers. The plaintiff refused
to undergo the operation.

At first instance Pearson J found that the plaintiff and the defendant was equally to
be blame for the accident but that the plaintiffs continuing disability was not due
to the accident but to his unreasonable refusal; that therefore, the defendants
were responsible for the loss of wages up to the time when the plaintiff, having
supposedly had the operation, would have been able to return to work.

On appeal the plaintiff argued against the quantum of damages, alleging that
refusal was not unreasonable in that the advice was given by a doctor who was
not the plaintiffs doctor. However, it was held that a plaintiff should not disregard
the advice of a doctor who was acting on behalf of defendants; that the plaintiff
was not advised by any doctor not to have the operation and so his refusal was
unreasonable. The plaintiff could not recover for the damages which he should
have mitigated and only got damages for loss of earnings up to the time he would
have recovered if he had undergone the operation.

(ii) A plaintiff will not be prejudiced by his financial inability to take steps in
mitigation. As Lord Collins said in Clippens Oil Co v Edinburgh ad District Water
Trustees:
In my opinion the wrongdoer must take his victim talem qualem, and if the
position of the latter is aggravated because he is without the means of mitigating
it, so much the worse for the wrongdoer, who has not got to be answerable for the
consequences flowing from his tortuous act.

Recovery for loss incurred in attempts to mitigate

The plaintiff, during his efforts to mitigate the damage, may incur further loss, which
will often be loss which is not in addition to, but in place of and less than, the loss

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which he is attempting to mitigate. This is particularly so in the case of expenses.
The expenses incurred by the plaintiff as the result of the tort or breach of contract
for which recovery is allowed in the cases are generally expenses incurred to avoid
or minimize a loss. This is so where money is laid out in acquiring or hiring a
substitute where the plaintiffs property is damaged; where medical expenses are
incurred to ameliorate the plaintiffs physical injury caused by the defendant etc.
The law allows recovery for losses and expenses reasonably incurred in mitigation
even though the resulting damage is in the event greater than it would have been
had the mitigating steps not been taken.

Actions taken before breach

Actions taken before breach cannot be within the principle laid down in British
Westinghouse since the action must arise out of the consequence of the breach of
duty.

Financial precautions taken before injury against the eventuality of injury

Where the plaintiff has taken precautions against injury by way of insurance,
pension, or the like, and is then injured by the wrong of the defendant, the
damages recoverable will not be diminished by the amount of insurance, pension
or other such moneys. This was settled by the decision of the House of Lords in
*Parry v Cleaver.

Facts

The facts were that the appellant, whilst he was a police constable, earned 21
18s per week. He contributed 1 3s per week under the Police Pensions
Regulations 1962 in respect of pension rights. In 1963 he was injured, as a result of
the respondents negligence, whilst he was directing traffic. In the following year
the appellant was discharged from the police force and awarded a police ill-
health award of 3 18s per week for life. After his discharge the appellant found
employment as a clerk, in respect of which he received (after being so employed
for nine months) 13 16s per week. If the appellant had served 25 years as a

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constable he would on retirement have received a retirement pension of 515 per
annum; if he had served for 30 years this would have been 686 per annum. It was
conceded that in respect of the period after he would have reached retirement
age the ill-health award should be taken into account in assessing his damages.

Held (Lord Moris of Borth-Y-Gest and Lord Pearson dissenting). In the

computation of damages for loss of earning capacity, the ill-health award to
which the appellant was entitled, although it would have to be brought into
account in respect of his loss of retirement pension, was not deductible in assessing
damages for his loss of earnings
Lord Reid said:
So by having to leave the police force the appellant lost two things: first, the
wage which he would actually have received until his retirement from the police
force if he had not been injured, ie, his gross wage of 21 18s 3d minus the sum
which would have been retained as a contribution 1 3s 1d; and secondly, the
opportunity, by continuing to serve and to make this contribution to obtain his full
retirement pension. On the other hand, he gained two things, the wage which he
received as a clerk, which must admittedly be set-off against the wage which he
lost, and the ill-health pension. The main question in the case is whether this
pension must be brought into account
He went on to say:
As regards moneys coming to the plaintiff under a contract of insurance, I think
that the real and substantial reason for disregarding them is that the plaintiff has
bought them and that it would be unjust and unreasonable to hold that the
money which he prudently spent on premiums and the benefit from it should
ensure to the benefit of the tortfeasor..
Actions taken after breach by third parties
Actions taken after breach by third parties cannot be within the principle laid
down in British Westinghouse as what is envisaged are steps taken by the plaintiff
himself. This is well illustrated by cases in which the plaintiff has suffered personal
injuries and a third party has gratuitously come to his financial rescue by payment

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of medical or living expenses, or continued payment of wages, or by way of a
general sum not in relation to a particular head of loss.

In *Cunningham v Harrison ex gratia payments had been made by a sympathetic

employer and in Redpath v Belfast and County Down Ry a charitable fund,
voluntarily subscribed to by the public, was set up to aid victims of a railway
disaster, and the plaintiff, one of the victims, received a sum from this fund. In such
cases no deduction was made in such case from the damages on account of
such payment. The rationale for not allowing such deductions is that the benefit
thus accruing to the plaintiff may not remain with him, as he may be under an
obligation to pay back to the third party if he should recover damages from the
defendant.

Also in Cunningham v Harrison the wife of a severely disabled plaintiff, who had
initially looked after him, had died before the trial. Lord Denning said:

Before dealing with [the claim for future nursing expenses] I would like to consider
what the position would have been if the wife had not died and had continued to
look after her husband, as she had been doing.It seems to me that when a
husband is grievously injured and is entitled to damages then it is only right and just
that, if his wife renders services to him, instead of a nurse, he should recover
compensation for the value of the services that his wife has rendered. On
recovering such an amount, the husband should hold it on trust for her and pay it
over to her. She cannot herself sue the wrongdoer but she has rendered services
necessitated by the wrongdoing, and should be compensated for it. If she had
given up paid work to look after him, he would clearly have been entitled to
recover on her behalf; because the family income would have dropped by so
much. Even though she had not been doing paid work but only domestic duties in
the house, nevertheless all extra attendance on him certainly calls for
compensation.

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*Hunt v Severs
The House of Lords, having approved the principle in Cunningham v Harrison, has
now in Hunt v Severs imposed a trust where the damages are in respect of the
plaintiffs care needs.
In 1985 the plaintiff aged 22 was seriously injured when she was riding as a pillion
passenger on a motorcycle driven by the defendant. She sustained injuries
resulting in paraplegia, and in the course of subsequent medical treatment she
suffered further incapacity. Throughout the period the defendant, whom she
married in 1990, was concerned for her care. In the plaintiffs action for damages
for personal injuries the defendant admitted liability but disputed claims for
traveling expenses incurred by him in visiting the plaintiff in hospital and for the
value of services rendered and to be rendered by him in assisting her in care.

The judge at first instance held that the voluntary provision of assistance by a
defendant tortfeasor did not preclude a plaintiff from recovering sums
representing the value of his services.

However on appeal it was held:

1) that a plaintiff who had established a claim for damages for personal injury
was entitled to recover as part of those damages the reasonable value of services
rendered to him gratuitously by a member of his family in the provision of nursing
care or domestic assistance rendered necessary by the plaintiffs injuries; that since
the underlying rationale of that principle was to enable the voluntary carer to
receive proper compensation for his services, the injured plaintiff who recovered
damages under that head held them on trust for the voluntary carer;

2) But that where the carer was himself the torfeasor, there could be no
ground in public policy or otherwise for requiring him to pay to the plaintiff a sum of
money representing the value of services which he had himself rendered, since the
plaintiff would have to repay that sum to him; and that, accordingly, the plaintiffs
award of damages would be reduced so as to exclude the cost of the

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defendants traveling expenses incurred in visiting the plaintiff in hospital and the
value of the services rendered by him in caring for her at home.

MITIGATION IN DEFAMATION

The tort of defamation exists in order to protect reputations, and damages here
can compensate for both pecuniary and non-pecuniary loss caused.

McCarey v Associated Newspapers Ltd

In this case L9,000 damages had been awarded by the jury in a libel action. The
Court of Appeal overturned this as being too high; no punitive damages could
here be awarded, and as claimant had not proved any consequent pecuniary
loss, he should be restricted to general loss of reputation as a non-pecuniary loss,
plus mental distress damages for grief and annoyance. The judgment do
recognize, however, that pecuniary loss flowing from the loss of reputation, as well
as the non-pecuniary loss itself, can be compensated, Diplock LJ said, for example:

Under head (1) that is to say, the consequences of the attitude adopted
towards the plaintiff by other persons- it may be possible to prove pecuniary loss,
such as loss of practice or employment, or inability to obtain fresh appointment
But the major consequences under head (1) may be purely social and lie in the
attitude adopted towards the plaintiff by persons with whom he comes into social
or professional contact.

Mitigation in Defamation
Mitigation is making the loss less and it is the opposite of aggravation in this area.
The doctrine of mitigation begins to operate at an early stage and not post-
breach as in other areas of law. This is so because the character of the claimant is
very important. Where there is defamation of the claimant and the claimant sues
saying that he has been defamed pre-defamation character is important. If it is
not a good character it will go towards mitigating damages. If it is a good one it
will go towards increasing/aggravating the damages.

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Onus to mitigate on the defendant
In other branches of law the obligation is on the claimant, the victim of breach of
duty, to mitigate his losses. In the tort of defamation it is on the defendant. Once
the defendant realizes that he cannot prove the truth of its allegations he can
mitigate by an apology or an offer to make amends.

See the very important Jamaican case of *Eric Anthony Abrahams v The Gleaner
Company Limited and Dudley Stokes in which the defendant Gleaner Co.
persisted with the defence of justification even though it could not prove the truth
of its allegations against claimant, Mr Abrahams.

Facts
In 1987 the Daily Gleaner and the Star published libellous articles about Mr
Abrahams who had been Minister of Tourism for Jamaica between 1980 and 1984.
Mr Abrahams immediately commenced proceedings against the appellants for
libel. They pleaded justification and qualified privilege. The defence alleged that
the words published were true, in substance and in fact, when they imputed
corruption, bribery and criminal conduct by the appellant with respect to tourism
contracts between the Jamaican Government and American businessmen

The appellant sought further and better particulars with respect to the pleas of the
respondents. The respondents were unable to file such particulars and claimed
that it was difficult to obtain information from the US Federal Grand Jury on the
matter.

The Court of Appeal held:

(i) pleas of justification and qualified privilege must clearly and unequivocally
particularize the facts relied upon and in the instant case, given the general
charge and corruption in the pleaded defence, particulars comparable to that
required in an indictment were necessary and therefore the application for further
and better particulars ought to have granted

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(ii) a defendant should never place a plea of justification on the record as a
defence unless he has clear and sufficient evidence of the truth of the imputation
and he must plead his case with sufficient particulars to enable the plaintiff to
know clearly what is the case; in the instant case, the facts pleaded are not
capable of being the basis of a plea of justification

(iii) the plea of qualified privilege is open to a defendant when he publishes a

fair and accurate report of proceedings of public interest, without malice, acting
under a sense of duty and it is in the publics interest to receive the report, but if a
defendant is to rely on such a defence, he must give the plaintiff sufficient
particulars of the facts and circumstances to meet the case against him and to
enable him to reply; in the instant case, while allegations and charges were made
and still under investigation, there was no duty to report them to the public;

(iv) the Court of Appeal has an inherent jurisdiction to strike out pleadings, such
as a defence, which reveal no reasonable answer and/or are embarrassing; in the
instant case, having regard to the admission of counsel for the defendants that it
would take a year to supply the further and better particulars requested, and the
failure of the defence as pleaded to disclose a reasonable answer, the pleas of
justification and qualified privilege are bad and both defences must be struck off.

So, the Court of Appeal struck out the defendants defence at in interlocutory
judgment in 1994 and the only remaining issue was the amount of damages. In
1996 the jury awarded J$80.7 million. The defendants appealed. The Court of
Appeal set aside the award and substituted J$35 million. The defendants
appealed to the Privy Council on the ground that the damages are still excessive.

The Privy Council found that the award of the Court of Appeal was not in-
excessive.

Pecuniary and non-pecuniary losses

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The appellant suffered both pecuniary and non-pecuniary losses. Mr Abrahams
pleaded no special damage, such as loss of particular earnings, but gave
evidence in support of an award of general damages which took loss of earnings
into account. He said that in 1987 his business as a tourism consultant was
prospering and seemed about to take off. He hoped to make real money. After
the publications his consultancy business collapsed. No one was willing to do
business with him. Apart from his salary as a Member of Parliament, he did not
earn a shilling His goodwill as a consultant had depended entirely upon the
contacts which he had made over the years; at school, at the University of the
West Indies, at Oxford, in business and politics. As he said his contacts were the
only capital assets he had. When he was proclaimed to be dishonest, they all
melted away. For five years following publications he earned nothing and then
had to take up a different occupation.

In addition, Mr Abrahams called medical evidence about the effect on him of the
ostracism and humiliation he had suffered. He had, for example, been thrown out
of the offices of a potential client and searched by his security officers. At one
stage he felt unwilling to go out of doors. An eminent psychiatrist deposed that he
had suffered both physiological and mental damage; the aggravation of asthma
and diabetes, development of obesity through inertia; damage to his self-esteem.

Attempts by the defendant at mitigation

(i) Offer of employment by the said defendant

Mr Abrahams was approached by the manager of a new radio station called
Power 106 in which The Gleaner Company Limited had a controlling interest and
offered a contract. Mr Abrahams said that he was unhappy about being
employed by a company which was publicly alleging that he was dishonest. Mr
Abrahams refused the offer because the Gleaner told him that if he took offer they
would not pay him damages but would only apologise.

(ii) The apology

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In 1995, when there appeared to be no way of avoiding the assessment of
damages, the Star and the Daily Gleaner published articles headed Apology.
No attempt had been made to negotiate the wording with Mr Abrahams in
advance.

At the trial for assessment of damages the defendants relied on mitigating steps
which they took:

1) that they had published a full and ample apology.

2) that AP (US news agency) where the got information from was a responsible
and reputable news agency.

3) that the grand jury in Connecticut had presented an indictment

4) that the defendants had made Mr Abrahams reasonable offers of

employment in an associated company.

However, their Lordships pointed to elements of aggravation by the defendant in

repeating the allegations against the appellant without proof:
For nearly sixteen years the defendants, with all the prestige and resources at their
command, have doggedly resisted the attempts of Mr Abrahams to clear his
name. (the defendants had refused to publish a rebuttal statement to allegations
made by the US News Agency and eve after the US agency realized it was not true
and stopped reporting it the Gleaner continued). They have maintain their
allegations far beyond the point in 1988 at which it became obvious that they had
no evidence to support them; at the trial in 1996 and even before their Lordships'
Board their printed case reads:

Because of the way in which the Court of Appeal struck out the defences, the
Appellants were deprived of the opportunity to prove the relevant facts, for
example, by calling Mr Gentles as a witness, cross-examining the Respondent,
seeking discovery of the Respondent's bank statements and cheque books and
copies of public relations and advertising contracts which he had signed,
administering interrogatories, seeking to subpoena copies of the relevant

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contractual documents from the Ministry of Tourism and giving notice to the
Respondent to admit relevant facts.

Their Lordships regard this passage as nothing more than a repetition of the libel
under cover of absolute privilege and cannot understand how it could have been
thought likely to induce their Lordships to reduce the damages. On the contrary, it
underlines the importance of Lord Hailshams observation in Broome v Cassel & Co
Ltd, that in case the allegations should re-emerge, the damages must be large
enough to proclaim the baselessness of the libel.

Note: Both the Court of Appeal and the Privy Council decisions are important.

TORTS AFECTING REALTY AND PERSONALTY

A defendants tort (such as trespass to land or goods, negligence, nuisance or

conversion) may cause damage to the claimants existing property, whether real
or personal. The appropriate measure of damages would be in tort and the
recoverability would be governed by limiting principles such as causation,
remoteness and mitigation.

Damage to realty- assessment of Damages

Recovery for damage to reality can be based on the diminution in value of the
property or the cost of cure. The former compensates the claimant for its loss of
financial advantage in being deprived of its property, while the latter
compensates for the cost of putting the claimant into as good a position as if its
property had not been damaged.

Diminution in value or the cost of cure measure

The diminution in value of real property is normally assessed by taking the
difference between the market selling price of the damaged and undamaged

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property, while the cost of cure normally comprises the cost of repair or, as a more
appropriate term where a building has been destroyed, the cost of reinstatement.

*Dodd Properties v Cantebury City Council

This case illustrates the basis on which the choice is made between the diminution
in value and the cost of cure basis. In this case the claimants building had been
damaged by the defendants pile-driving. In an action for negligence and
nuisance, the defendants conceded that they were liable for the cost of repairs.
Donaldson LJ explained the law on damages for property damage. Having said
that there are two ways of assessing damages for damage to reality, he went on:

the first is to take the property in an undamaged state and to compare it with its
value in a damaged state. The second is to take the cost of repair or
reinstatement. Which is appropriate will depend on a number of factors, such as
the plaintiffs future intentions as to the use of the property and the reasonableness
of those intentions. If he reasonably intends to sell the property in its damaged
state, clearly the diminution in capital value is the true measure of damages. If he
reasonably intends to continue to occupy it and to repair the damage, clearly, the
cost of repairs is the true measure. And there may be in between situations.

In Hollebone v Midhurst and Fernhurst a decision had to be made between the

two choices. In this case the claimants dwelling house had been damaged by
fire due to the admitted negligence of the defendant. The claimant was awarded
the cost of repairs rather than the diminution in value even thought the cost of
repairs was more. This was a correct decision because the claimant had already
carried out repairs and it was reasonable for him to have done so given that he
owned the house for living in.

So, if the claimants requires the property for accommodation the cost of cure
basis of assessment will be chosen and he will be able to recover damages for the
cost of repairs. However, if he intends to sell it then the diminution in value basis will
be favoured and he will be awarded the loss of his financial advantage, i.e. the

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difference between the market value of the property in the damaged and
undamaged state.

Damage to personalty/chattel- assessment of damages

Where the chattel is damaged there are two possible modes of assessment:
(1) If the chattel is in such a condition that it is reasonable to repair it, the
basic measure is the cost of such repairs;
(2) If the injury is so severe that it is not reasonable to repair it, the case will
be treated as one of constructive total loss, in which case the claimant can
recover the cost of replacement.

Cost of repairs
(a) it must be reasonable to repair
In determining whether or not it was reasonable to repair the chattel, the court will
look first to the cost of repairs. If this cost exceeds the value of the article (by
which presumably is meant the purchase price of an equivalent article on the
market), the presumption is that repair was unreasonable. The presumption may
be rebutted by the existence of special circumstances.

*OGrady v Westminister Scaffolding

Special circumstances were present in that the car was unique. Here Ps car
Hortensia, a 1938 M.G. and his pride and joy, was damaged in accident for
which D was liable. P spent L253 on repairs and L207 in hiring substitutes during
repairs. The pre-accident market value of Hortensia was L180- L200. Edmund
Davies J held that in the circumstances P had acted reasonably and awarded him
the full cost of repairs. In coming to his decision, he also referred to the difficulty of
obtaining a similar vehicle on the open market.

OGrady was considered in *Darbishire v Warren in which the Court of Appeal

rejected a claim for the cost of repairing a second-hand shooting brake (a car)
where such cost substantially exceeded the pre-accident value of the car. The
plaintiff was awarded as sum representing the market value of the vehicle on

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the ground that he should have treated it as a constructive total loss. In
distinguishing OGrady, their Lordships laid greater emphasis on the uniqueness and
irreplaceability of Hortensia than on the sentimental attachment of its owner
(thought they considered the latter).

So where a chattel has been damaged and it is reasonable to repair it, the cost of
repairs will be recovered. However, if it is not reasonable to repair the chattel
because it is badly damaged and there are no special circumstances justifying
repairing it, then it is likely that the tribunal will award the cost of replacement.

Recovery of General Damages

The Greta Holme and The Mediana

These cases illustrates that a claimant can recover for the loss of use of chattels
under the head of general damages even where the chattels were not profit-
earning ones. The same principle applies to other chattels.

In The Greta Holme, a ship which was owned by a public body not for profit
earning, the damage to the dredger resulted in a delay in the dredging, the
plaintiffs not having gone to the cost of substituting a new dredger while the
damaged one was repaired.

The House of Lords, reversing the Court of Appeal, allowed general damages for
the loss of use while the dredger was undergoing repairs. So, for example, where a
car is damaged the owner can recover loss of use if he had not hired a substitute.

Recovery of special damages

If the chattel was used for private purposes as well as for generating profits the
claimant can also recover loss of income in addition to loss of use (i.e private
use).
However, the income generated from the chattel must be legitimate. So, for
example, if an owner uses his car to operate an unlicensed taxi as well as for

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private use, he cannot recover for loss of income as special damages because
his income would have been illegitimate. In *Dyer & Dyer v Stone the wife could
not recover loss of income from he deceased husbands taxi because it was
unlicensed as such.

According to Lecturer: Where in a car accident the car is damaged, the claimant
can recover two things:
1) the cost of repairs as special damages
2) and the loss of use as general damages
However, where the claimant hires a substitute he cannot recover for loss of use
in addition to the cost for hire because that would amount to double-recovery.
He could however recover for the cost of hire and the cost of repairs.

EXEMPLARY DAMAGES

The primary object of an award of damages is to compensate the plaintiff for the
harm done to him; a possible secondary object is to punish the defendant for his
conduct in inflicting that harm. Such secondary object can be achieved by
awarding exemplary damages.

Exemplary damages is a sum of money awarded in addition to any compensatory

award made by the tribunal or could be a punitive component of a large
compensatory award. So, exemplary damages comes into play whenever the
defendants conduct is sufficiently outrageous to merit punishment, as where it
discloses malice, fraud, cruelty, insolence or the like.

Are punitive damages awarded for breach of contract?

As laid down in *Addis v Gramophone Co Ltd, no punitive damages can be
awarded for breach of contract. There the claimant had been wrongfully
dismissed. The House of Lords restricted damages to his pecuniary loss and refused
to award any damages for the harsh manner in which he had been treated.

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However, recent developments suggest that the rule in Addis that punitive
damages can never be awarded for breach of contract may require
reconsideration in the near future. For instance there has been the decision of the
House of Lords in Kuddus v Chief Constable of Leicestershire Constabulary
removing the former cause of action restriction on punitive damages for torts.
Although their Lordships did not mention breach of contract, the removal of the
cause of action test for torts clearly leads on to the question whether it is
satisfactory to rule out punitive damages because the cause of action is breach of
contract.

Are punitive damages awarded for torts?

Tort is the home ground for exemplary damages. When an award of
compensatory damages is made in the face of a claim on the footing of
exemplary damages, the tribunal has to consider whether the compensatory
award is itself sufficient to show the defendant that tort does not pay and to make
a denunciatory statement. If indeed it is sufficient, no separate exemplary award
should be made but if its not, then a separate award should be made.

When are punitive damages awarded for torts?

The situations in which punitive damages can be awarded for torts were laid down
by Lord Devlin in *Rookes v Barnard. The case concerned the tort of intimidation,
and at first instance Sachs J had ruled that punitive damages could be awarded.
The House of Lords overturned that ruling. Lord Devlin laid down three sole
categories in which punitive damages can be awarded. However, the facts of
Rookes did not fall within any of these categories; he concluded that no punitive
damages should have been awarded.

Exemplary damages can be awarded:

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1) Where there are oppressive, arbitrary or unconstitutional actions by servants
of the government.
2)
In * Cassell v Broome it was made clear that servants of the government is to be
widely construed. Lord Diplock said, It would embrace all persons purporting to
exercise powers of government, central or local, conferred upon them by statute
or at common law by virtue of the official status or employment which they hold.
It is also important that the defendant must have been exercising governmental
power and was not acting within a private capacity at the time when the tortuous
act was committed.

English cases
These cases illustrates that exemplary damages will be awarded once servants of
the government carry out arbitrary acts in the course of their duty.

In White v Metropolitan Police Comr punitive damages were awarded to the

claimants for false imprisonment, assault and malicious prosecution by several
police officers.

In Treadaway v Chief Constable of West Midlands, in addition to compensatory

damages, punitive damages were awarded to the claimant who had a
confession extracted from him by police officers placing a bin bag over his head.

Caribbean case
*Marshall v Semper and Others
Illustrates the principle that exemplary damages will not be awarded where the
defendant, though a servant of the government and acted arbitrarily, was acting
in a private capacity and not during the course of his employment.

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The claimant was a shop detective who apprehended a sergeants wife for shop-
lifting. Less than a week later the sergeant accosted the claimant in the streets
threatening to cause him to lose his employment for accusing his wife of theft.
Upon being challenged by the claimant to carry out the threat, the sergeant
collared him, cuffed him and instructed two other corporals to arrest him, alleging
that the claimant had insulted and molested a woman who was passing by.

Wooding CJ held:
(i) compensatory damages against joint tortfeasors should not be assessed
according to the act of the most guilty or the most innocent, but must relate to the
aggregate of the claimants injury.
(ii) that exemplary damages should never be awarded against a
defendant whose conduct has not been such as to call for punishment or
deterrence merely because a co-defendant has been found to be within one of
the categories of persons who should be punished or deterred

Wooding CJ considered whether an award should be made against the sergeant

and said:

In my judgment, this case falls into none of the three categories although, I
grant, it comes very close to the first. As an SRP sergeant, Semper was a servant of
the people and his use of his powers as such should always have been subordinate
to his duty of service. This might well have raised a nice question whether, when he
acted as such, he fell to be regarded as a servant of the government. But, in the
instant case, I am satisfied he was not acting as such and that, however misguided
Jardine and Carmichael were in submitting to his supposed authority, they knew
(and so did the plaintiff) that he was merely pretending to exercise authority as an
SRP when in fact he was acting in his private capacity. Consequently, I accept
Lord Devlins guidance that while there is something repugnant about a big man
bullying a small man, and very likely the bullying will be a source of humiliation that
makes the case one for aggravated damages, it is not punishable by exemplary
damages

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3) Where the defendants conduct has been calculated by him/her to make a
profit for him/herself which may will exceed the compensation payable to the
claimant.

Defamation cases
This category features a lot in defamation cases where the defendant knowing,
had reasonable cause or reckless disregard as to the quality of the matter,
nevertheless publishes the matter.

See *Cassell v Broome

The claimant, a distinguished retired naval officer, sued the publisher and author of
a book telling of the war-time destruction of a navy-escorted convoy, and libellous
of the claimant in imputing to him responsibility for the disaster. The House of Lords
was satisfied that there was a sufficient calculation of profit by both author and
publisher to justify an exemplary award. Lord Morris said:

There may be exemplary damages if a defendant has formed and been guided
by the view that, though he may have to pay some damages or compensation
because of what he intends to do, yet he will in some way gain (for the category is
not confined to money making in the strict sense) or may make money out of it, to
an extent which he hopes and expects will be worth his while. I do not think that
the word calculated was used to denote some precise balancing process. The
situation contemplated is where someone faces up to the possibility of having to
pay damages for doing something which may be held to have been wrong but
where nevertheless deliberately carries out his plan because he thinks that it will
work out satisfactorily for him.

Calculation
Similarly, Lord Devlin said that the question of calculation is not restricted to
mathematical calculation that the profit to be made from the tort would exceed

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the damages and costs to which he would make him self liable. As Lord Hailsham
said, The defendant may calculate that the plaintiff will not sue at all.

Landlord and tenant cases

Apart from libel, the main use of this second category has been in actions by
tenants against landlords for wrongful harassment or eviction founded on the torts
of trespass or nuisance.

*Drane v Evangelou
In this case the Court of Appeal upheld an award of exemplary damages. There
the landlord engineered the tenants exclusion from the premises by trespass,
forcefully entering them when the tenant was out. On his return the tenant found
his furnished maisonette bolted on the inside with several people within and his
belongings out in the yard. The Court of Appeal held that the award was justified.
But Lord Denning and Goff LJ cited that part of Lord Devlins judgment where he
said:

This category is not confined to moneymaking in the strict sense. It extends to

cases in which the defendant is seeking to gain at the expense of the plaintiff
some object- perhaps some property which he covets- which either he could not
obtain at all or not obtain except at a price greater than he wants to put down.

And Lord Denning said:

this category includes cases of unlawful eviction of a tenant. The landlord seeks
to gain possession at the expense of the tenant, so as to keep or get higher than
that awarded by the rent tribunal, or to get possession from a tenant who is
protected by the Rent Acts.

*Valentine v Rampersad
Exemplary damages were awarded here for wrongful eviction.

Page 39 of 169
 R purchased dwelling premises occupied for nine years by V who paid a monthly
rent of $6 for three rooms of a four-roomed building in which one of the rooms was
unoccupied when R purchased. V had the use also of a kitchen, a bathroom, and
a latrine. Shortly after the purchase V offered to pay rent to R, who refused it and
told her that he intended to demolish the premises so she should keep the money
to seek other accommodation. In order to evict V, Rs workmen on Rs instructions
entered the premises without Vs knowledge or consent and cut down a tree
which fell and demolished the latrine. They later dumped 100 loads of gravel which
formed a high mound on the premises and he instructed his workmen, unknown to
V, to carry out certain works including the removal of galvanized sheets from the
roof of the unoccupied room.

The trial judge regarded the action as a proper case in which an element of
aggravation should be taken into account in assessing compensatory damages,
but declined to award exemplary damages because, as he said, he was not
persuaded to the view that the respondents conduct was either so high-handed
or ruthless to warrant punishment.

On appeal, Held:

(i) that on the facts found by the trial judge the circumstances disclosed a clear
case of harassment and ruthless disregard by the landlord of the rights of the
tenant.

(ii) that the dictum of Lord Devlin in Rookes v Barnard does not exclude the
possibility of oppressive action by private corporations or individuals being visited
by an award of exemplary damages.

(iii) that the respondents conduct was oppressive in a real sense and
warranted punishment by exemplary damages.

Fraser JA said:
the respondents conduct was oppressive in a real sense and his ultimate
objective is not relevant. In the event he intended to make a gift of the property

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to another person or desired it to be occupied by a member of his family his
conduct would have been nonetheless oppressive and as such warrants
punishment by exemplary damages. But I am satisfied also that the respondents
conduct falls within the second category of acts described by LORD DEVLIN in
which the defendants conduct has been calculated by him to make a profit for
himself which may well exceed the compensation payable to the plaintiff. There
was no evidence of the purchase price paid by the respondent for the property of
which the appellant was the tenant; nor was there evidence of his building
expenses, legal fees, etc, or of the enhanced value of the premises with the new
building. If there was actual evidence of these matters the decision may have
been simplified but I do not think its absence should restrain the action of this court.
It seems to me a reasonable inference to draw from the facts that, as a business
transaction, the respondent intended to enhance the value of the property by
erecting a new building and thereby to obtain a capital gain on his investment. In
this he succeeded; but although he eventually obtained an order of possession his
acts of harassment before the writ was filed were all calculated to achieve that
objective. In my judgment, these circumstances justify an award of exemplary
damages which I assess at $500.

*Douglas v Bowen

Issue: Whether Rookes v Barnard should apply to Jamaica and whether exemplary
damages was justifiably awarded.

In this case the appellant let a dwelling-house on a monthly tenancy to the

respondent for the purpose of carrying on the business of a night club. Rental was
50 per month. In order to get out the tenant the respondent gave a notice to quit
which subsequently became invalid since the respondent had paid the rent.
However, the appellant caused the electricity and water to be shut off, caused a
bulldozer to enter the demised premises and to demolish the terrace which was
built by the respondent with approval by the appellant, caused the night club sign

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to be knocked down, caused the hedge near the entrance to the premises to be
chopped down, the respondent's furniture to be removed upon which they were
severely damaged and the main building and the outbuilding to be demolished.

First instance

The respondent claimed against the appellant damages for loss of use and
enjoyment of the house, and trespass to goods. At first instance, before Rowe J,
the appellant admitted that when he caused the demolition of the demised
premises his state of mind was that he was prepared to pay for so doing. Rowe J,
found that the appellant knew that the notice to quit was invalid. He came to the
conclusion that the appellant did not want the premises for any particular reason
but that in a high-handed, oppressive, vindictive, wanton manner destroyed the
(respondent's) means of livelihood, her house and that of her children. He
awarded in addition to compensatory damages, exemplary damages.

Rowe J said that this was:

the most outrageous trespass, the most cold-blooded disregard of anyone's rights,
the most calculated misuse of personal power, the most cruel onslaught on a
defenceless woman and her children without rhyme or reason that I have ever
seen in these Courts.

On appeal

The appellant sought to have the award of compensatory damages reduced as

being too high. He also sought to have the award of exemplary damages set
aside on the ground that in the particular circumstances of this case an award of
exemplary damages was not permissible. For this proposition the appellant relied
on the categories of cases, enumerated by Lord Devlin in Rookes v Barnard in
which an award of exemplary damages was sanctioned. Alternatively, he sought
to have the award under this head reduced.

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Held:

(i) that the sum of $5,000 awarded as compensatory damages for the injury to
the respondent's feelings including the mental distress to which she was subjected
by reason of the appellant's conduct in evicting her could not, in the exceptional
circumstances of the case, be said to be too high;

(ii) (Graham-Perkins JA, dissenting). The categories of cases in which

exemplary damages might be awarded and which were enumerated in Rookes v
Barnard and approved in Cassell v Broome should be adopted and applied in
Jamaica. In that event it was clear that the acts of the appellant would fall
outside of those categories thus disentitling the respondent to an award of
exemplary damages.

Luckhoo P said:

the trial judge's finding that the appellant appeared to want the respondent
out of the house for no particular reason, and this finding is supported by the
evidence, would in my view mean that the respondent has failed to show in the
words of Lord Diplock that the appellant did direct his mind to the material
advantages to be gained by committing the tort and came to the conclusion that
they were worth the risk of having to compensate the plaintiff (respondent) if she
did bring an action. In that event if Rookes v Barnard were held to govern the
case the award of exemplary damages ought to be set aside..

He went on to say:

I would hold that the categorization decided on in Rookes v Barnard as

explained in Cassell v Broome ought to be adopted and applied in Jamaica and
that the appellant's act would fall outside of the categories of cases in which
exemplary damages might be awarded

However, GRAHAM-PERKINS JA dissented:

I am compelled to the conclusion that Lord Devlin's first and second
categories do not constitute a pronouncement, sanctioned either by principle or

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by precedent, as to the common law of England or of Jamaica. I would hold that
the Rookes v Barnard categories should not be held to be applicable to Jamaica.
Indeed, there has not been evident in the progress of the common law in
Jamaica any consideration of socio-legal policy that ought to compel the courts
of this country to follow Rookes v Barnard. I have not the least doubt that on its
particular facts as recited by the Acting President, an award of exemplary
damages was eminently justified and, indeed, necessary.

3) The third category is where legislation permits an award of exemplary damages.

Here the tribunal has no discretion but to award exemplary damages. See Labour
Code in some jurisdictions.

AGGRAVATED DAMAGES

An award of aggravated damages serves to compensate non-pecuniary losses

such as injury to the P's feelings and pride.

Aggravated damages distinguished

In Rookes v Barnard distinction was made between aggravated damages and
compensatory damages. Lord Devlin stated the object of damages which are
compensatory is to compensate and those which are exemplary is to punish and
deter. He stated that the compensation may nevertheless be aggravated
because the injury which has been occasioned has in essence been aggravated.
He stated further that care must be taken not to confuse aggravation of the injury,
such as would warrant aggravation of the damages, with punishment for
malevolent, spiteful or malicious conduct such as might call for the award of
exemplary damages

Types of aggravated situations

1.`One category is an exception to the rule in Addis v Gramaphone

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Breach of Contract- Can mental distress damages be awarded?

Traditionally *Addis v Gramophone was regarded as barring any damages for

mental distress in an action for breach of contract. The House of Lords held that
damages for the wrongful dismissal of a servant could not include compensation
for his injured feelings, even if he had been dismissed in a harsh and humiliating
manner. Damages were confined to his direct pecuniary loss.

However, the Court of Appeal in Watts v Morrow has clarified that there are only
two exceptional categories of case where mental distress damages are
recoverable for breach of contract. Bingham LJ said:
A contract-breaker is not in general liable for distress, frustration, anxiety,
displeasure, vexation, tension or aggravation which his breach if contract may
cause to the innocent party. The rule is not, I think founded on the assumption that
such reactions are not foreseeable, which they are or may be, but on
considerations of policy. But the rule is not absolute. Where the very object of a
contract is to provide pleasure, relaxation, peace of mind or freedom from
molestation, damages will be awarded if fruit of the contract is not provided or if
the contrary result is procured instead. If the law did not cater for this exceptional
category of case it would be defective. A contract to survey the condition of a
house for a prospective purchaser does not, however, fall within this exceptional
category. In cases not falling within this exceptional category, damages are in my
view recoverable for physical inconvenience and discomfort caused by the
breach and mental suffering directly related to that inconvenience and
discomfort.

Therefore, one exception to the rule in Addis and which would attract aggravated
damages is where the very object of a contract is to provide pleasure, relaxation,
peace of mind or freedom from molestation. Note though, that such items of
losses are not truly aggravated damages.

Page 45 of 169
see*Jarvis v Swan Tours Ltd
This case involved a spoiled holiday. The plaintiff had booked a winter sports
holiday in Switzerland in reliance on the defendant travel agents lavishly
illustrated brochure with its ecstatic text, only to discover that the great time
which had been promised did not materialize and the many facilities which had
been led to expect were simply not there. The holiday proved a great
disappointment, and the Court of Appeal gave the plaintiff damages for
disappointment, distress, annoyance and frustration caused by the breach of
contract
See Heywood v Wellers
The fact situation was different from that of Jarvis but damages were awarded for
distress. Here the defendant solicitors, in breach of their contractual duty of care,
had failed to gain an injunction to stop molestation of the claimant by her former
boyfriend. and the plaintiff was further molested, causing her mental distress. The
Court of Appeal awarded her damages for the mental distress resulting from being
further molested

Also in *Diesen v Samson a bride was awarded damages for distress and
disappointment by reason of having no pictorial record of her wedding as the
defendant photographer in breach of contract failed to appear there.

2. Another category under which aggravated damages can be awarded is where

the claimant experiences physical inconvenience from the defendants breach of
contract

(a) It has long been established that damages for physical inconvenience can
be awarded.
In Hobbs v London and South western Rly Co. a man and his family were set down
to the wrong station by the defendant railway company in breach of contract. As
it was late at night, there was no available transport or accommodation and so,
despite rain, they had to walk five miles home.

Page 46 of 169
In Perera v Vandiyar where the defendant landlord, in an attempt to evict the
claimant, cut off the supply of gas and electricity to his flat, leaving the claimant
without alternative means of heat or light. After two days of discomfort, the
claimant left with his wife and child to stay with friends for five days until the gas
and electricity supply were restored. The claimant was awarded physical
inconvenience damages for breach by the landlord of his tenancy agreement.

(b) Damages for mental distress consequent on physical inconvenience are

also recoverable.
For example, in Perry v Sidney Phillips & Son the claimant bought a house on faith
of a survey report prepared by the defendants, a firm of chartered surveyors. The
report had been negligently made, in breach of the defendants contractual and
tortuous duty of care, and did not mention several serious defects including a
leaking roof and a septic tank which produced an offensive smell. The claimant
was held entitled to mental distress damages for the anxiety, worry and distress
caused and this mental distress is best viewed as directly consequent on the
physical inconvenience of having to live in a house that was in a poor condition.

In *Watts v Morrow a husband and a wife were each awarded sums for the
physical inconvenience and directly related mental distress of living (at weekends)
in a house undergoing extensive repairs. The repairs were necessitated by defects
that had been negligently omitted from the defendants survey report upon which
the claimants had relied in buying the house. Damages were therefore awarded
within this second category laid down by Bingham LJ whereas they could not have
been awarded within the first category (the contract being for an ordinary house
survey).

Tort
In tort damages for physical inconvenience, as in contract, have long been
recoverable and so are damages for mental distress consequent on physical
inconvenience. While usually not classified under the head of physical
inconvenience, damages for the tort of false imprisonment must always include

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compensation for the claimants physical inconvenience. The same must generally
be true for nuisance.

In Bone v Seale for example, two owners of neighbouring property were awarded
damages for the inconvenience, discomfort and annoyance caused by the
smells from the defendants pig farm which constituted a nuisance. Lord Goff said,
If a nuisance should occur, then the spouse who has an interest in the property
can recover any damages in respect of the discomfort or inconvenience caused
by the nuisance.

In Millington v Duffy a tenant was awarded damages for inconvenience and

distress primarily for trespass to land, his landlord having wrongfully evicted him.

And in Perry v Sidney Phillips & Son and Watts v Morrow damages for the physical
inconvenience (and consequent distress) of living in a house with defects (or while
repairs were being made to remedy those defects) that had been negligently
omitted from the defendants surveyors report were awarded in an action
brought for both the tort of negligence and breach of contract.

3.As it relates to tort, where the conduct of the defendant impacts the claimant and
increases the damages, aggravated damages may be awarded.

It looks at the damage suffered by the claimant and the manner in which the
damages have been increased by the conduct of the defendant. Note torts such
as false imprisonment.

See above * Marshall v Semper

In this case the claimant was assaulted by the sergeant and so he alone is liable
for the assault. However all three defendants were liable for the wrongful arrest
and false imprisonment, the sergeant for having caused and the other two for
having effected the same. Notwithstanding the different parts they played, they

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became joint tortfeasors so that there can be no difference in the damages in
which they must be held to be liable to the plaintiff.

Wooding CJ held that the conduct of the defendants attracted aggravated

damages. The particulars of aggravation were that, while on the streets, the
claimant was collared and cuffed. Wooding CJ said:
I accept Lord Devlins guidance that while there is something repugnant about
a big man bullying a small man, and very likely the bullying will be a source of
humiliation that makes the case one for aggravated damages, it is not punishable
by exemplary damages.

See also *Valentine v Rampersad where Fraser JA agreed with the trial judge that
the damage to the plaintiff was aggravated.

LIQUIDATED DAMAGES/AGREED DAMAGES

The parties to a contract may, as part of the agreement between them, fix the
amount which is to be paid by way of damages in the event of breach. This
amount may be a lump sum or a sum calculated on a graduated basis. Such
agreements feature a lot in building contracts which contain time clauses. In such
contracts, whether the agreed sum is recoverable from the party in breach
depends upon whether it constitutes liquidated damages, when it is recoverable,
or a penalty, when it is not.

Liquidated damages vs. penalties

Liquidated damages are a sum which represents a genuine pre-estimate of loss
caused by the breach, that is, of what is needed to put the claimant into a
position as if the contract had been performed. A penalty, on the other hand, is a
sum which is greater than such genuine pre-estimate, and is inserted to punish the
other party in the event of breach and to pressurize (in terrorem) him into carrying
out his contractual obligations.

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How does the court conclude that the stipulated sum is a penalty or liquidated
damages?
The court will consider guidelines laid down by the House of Lords in *Dunlop
Pneumatic Tyre Co. v New Garage and Motor Co which was endorsed by the
Judicial Committee of the Privy Council in *Phillips Hong Kong v Attorney-General
of Hong Kong. The court will consider these principles in deciding whether a sum is
liquidated damages or a penalty. Lord Dunedin observed that:
(i) The expression used [by the parties] is not conclusive. He said:
though the parties to a contract who used the words penalty or liquidated
damages may prima facie be supposed to mean what they say, yet the
expression used is not conclusive. The court must find out whether the payment
stipulated is in truth a penalty or liquidated damages.

( ii) The question whether a sum stipulated is a penalty or liquidated damages is

a question of construction to be decided upon the terms and inherent
circumstances of each particular contract, judged of as at the time of the making
of the contract, not as at the time of the breach.

See Clydebank Engineering Co. v Don Jose Ramos

In this case the defendants had contracted to build for the plaintiffs four torpedo-
boats to be used in the Spanish-American War of 1898, and the contract stipulated
that the defendants should pay the plaintiffs L500 for every weeks delay in delivery
of each vessel. Delivery was delayed and the plaintiffs successfully claimed the
stipulated sums as liquidated damages despite the fact, which was held to be
irrelevant, that all four torpedo-boats, had they been delivered @ the specified
time, would have been sunk together with the rest of the Spanish fleet

(iii)The sum will be held to be a penalty if it is extravagant and unconscionable in

amount in comparison with the greatest loss that could conceivably be proved to
have followed from the breach. So, for example, if a contract to carry out building
work worth L100 provided that the builder should pay L50,000 if failed to do the

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work, this would be a penalty. the question of proportionality will be considered by
the tribunal.

(iv)It will be held to be a penalty if the breach consists only in not paying a sum of
money, and the sum stipulated is a sum greater than the sum which ought to have
been paid. According to this, a clause making a debtor liable to pay L200, if he
fails to pay L150 on the due day would be penal. But this point is clearly open to
criticism in that a creditors obligations may mean that his loss exceeds the sum
due and the sum stipulated could very well, therefore, be a genuine pre-estimate
of loss.

(v)There is a presumption (but no more) that it is a penalty when a single lump

sum is made payable by way of compensation, on the occurrence of one or more
or all of several events, some of which may occasion serious and others but trifling
damage.

(vi)It is no obstacle to the sum stipulated being a genuine pre-estimate of

damage, that the consequences of the breach are such as to make precise pre-
estimation almost impossibility. On the contrary, that is just the situation when it is
probable that that pre-estimated damage was the true bargain between the
parties.

Dunlop Pneumatic Tyre Co. v New Garage and Motor Co

The appellants sold motor tyres to the respondents (dealers) under an agreement.
This required the respondents to pay a sum of L5 by way of liquidated damages for
every tyre sold at less than the appellants list prices, or supplied to persons to
whom the appellants would not supply. The respondents sold a tyre in breach of
this agreement and the appellants sued for damages. The respondents claimed
that the clause was a penalty.

Page 51 of 169
The House of Lords held that this sum was liquidated damages. Although there
were several ways in which tyres could be sold or offered in breach of the
agreement, the presumption in principle (v) was rebutted because the loss likely to
result from any such breach was difficult to assess and L5 represented a genuine
attempt to do so.

In Phillips Hong Kong Lord Woolf, giving the judgment of the Privy Council
upholding as liquidated damages a clause in a road construction contract,
considered that the courts should not be too zealous in knocking down clauses as
penal. What the parties have agreed should normally be upheld. More
specifically it was stressed that a clause can be a genuine pre-estimate of loss
even though hypothetical situations could be presented in which the claimants
actual loss would be substantially lower. To hold otherwise would be to render it
very difficult to draw up valid liquidated damages clauses in complex commercial
contracts. Moreover it was thought acceptable to take account of the fact that,
as it happened, the actual loss was not much greater than the agreed damages.
Although the matter must be judged as at the date the contract was made, what
actually happened can provide valuable evidence as to what could reasonably
be expected to be the loss at the time the contract was made.

So, as a concession to the arguments presented in the peculiar nature of the case,
the Board conceded that matters existing subsequent to the making of the
contract could be relevant to determining whether the sums stipulated is a
genuine pre-estimate of losses.

Effect of holding a stipulated sum to be liquidated damages or a penalty

Where sum is liquidated damages
Where the sum is adjudicated to be liquidated damages, the said sum is payable
without more, .i.e. there is no need for assessment and the concept of a duty to
mitigate would be entirely foreign to a claim for liquidated damages. Therefore,
the plaintiff can neither claim unliquidated damages in addition to the liquidated

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damages which are designed to deal with the loss that has occurred nor elect to
ignore the liquidated damages provision and sue only for unliquidated damages.

The plaintiff will however be entitled to sue for unliquidated damages in the
ordinary way in addition to suing for the liquidated damages if other breaches
have occurred outside those which fall within the ambit of the liquidated damages
provision, or it seems, if only part of the loss arising from a single breach is regarded
as falling within the provisions ambit.

Where sum is a penalty

But where it is adjudicated to be a penalty the clause in which the sum is
stipulated is inoperative and the claimant has to prove his/her loss in the normal
way and all the relevant limiting factors, such as causation, remoteness and
mitigation, would be applicable.

FORFEITURE OF DEPOSITS

Money paid or payable before breach: deposits and forfeiture clauses

Instead of agreeing that one party shall upon his breach of the contract pay to
the other a stipulated sum, the contract may call for the immediate deposit of
such a sum which upon the depositors breach of contract shall be forfeited to the
other. A provision that money paid shall not be recoverable on the payers default
may be either express or implied. An express provision of this type generally takes
the form of a forfeiture clause, a clause stating that the money shall be forfeited on
default; on the other hand a provision of this type is generally implied from the fact
that the money is stated to be paid as a deposit.

Where money paid is not liquidated damages it is a penalty

In general, a contractual provision which requires one party in the event of his
breach of the contract to pay or forfeit a sum of money to the other is unlawful as
being a penalty, unless such provision can be justified as being a payment of

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liquidated damages being a genuine pre-estimate of the loss which the innocent
party will incur by reason of the breach.

Exception
One exception to this general rule is the provision for the payment of a deposit by
the purchaser on a contract for sale of land. Ancient law has established that
forfeiture of such a deposit (customarily 10% of the contract price) does not fall
within the general rule and can be validly forfeited even though the amount of
deposit is not a genuine pre-estimate of loss likely to be suffered by the vendor. A
10% deposit is a permissible penalty which is irrecoverable. However, as seen in the
Jamaican case of *Workers Trust and Merchant Bank Limited v Dojap Investments
Limited, an impermissible penalty is recoverable not at law but in equity.

Function of the deposit

Ever since the decision in *Howe v Smith the nature of a deposit has been settled.
Even in the absence of express contractual provision, a deposit of 10% is an
earnest for the performance of the contract: in the event of completion of the
contract the deposit is applicable towards payment of the purchase price; in the
event of the purchasers failure to complete in accordance with the terms of the
contract, the deposit is forfeited, equity having no power to relieve against such
forfeiture. However, if the vendor defaults he has to return the deposit.

Equity of restitution vs. the right of retention

Right of retention at common law
In the Court of Appeal decision of *Stockloser v Johnson, the majority held that
when there is a forfeiture clause or the money is expressly paid as a deposit (which
is equivalent to a forfeiture clause), then the buyer who is in default cannot
recover the money at law at all. He may, however, have a remedy in equity, for,
despite the express stipulation in the contract, equity can relieve the buyer from
forfeiture of the money and order the seller to repay it on such terms as the court
thinks fit.

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Equity of restitution
It is the right to have money paid restored, bearing in mind also that there is a rule
of law which states that where equities are equal the law will prevail.

Equitable formula for recovery Relief against forfeiture

As established in Stockloser there are two conditions which must be satisfied
before a person can get relief against forfeiture:

1. The forfeiture clause must be of a penal nature.

Every stipulation for a deposit is inherently penal because the deposit is out
proportion to any loss that could flow from the breach and so that is why it is penal.
see *Workers Trust and Merchant Bank Limited v Dojap Investments Limited The
Privy Council recognized that even a 10% deposit which is traditional in
conveyancing is penal, though a permissible penalty. So, one cannot recover in
the normal circumstances a 10% deposit on the ground that it is penal. However,
in a decided case in the Commonwealth Caribbean, a 5% deposit was recovered
in light of the special circumstances which existed in that case.

2. It must be unconscionable in all the circumstances for the vendor to retain

the money.
The time at which unconscionablity is to be tested is at the time when the equity is
to be invoked and not at the time of the making of the contract. So, the tribunal
will look at the equities in favour of the vendor and the purchaser. They will be
weighed and if they are equal the law prevails.

See 5% case
Here the equities were not equal and equity granted the purchaser relief against
forfeiture. In this case the vendor was very unwilling to sell and the purchaser was
very anxious buy. In response to pressure the vendor doubled the price. The
purchaser defaulted while the realty appreciated in value. Within the contract
were a number of terms which included the vendors retention of all common law
and equitable remedies in case of breach. The vendor forfeited the deposit which

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 was 5% of the doubled price. However, in the circumstances the court ordered the
restoration of the 5%. Essentially the court held that it was unconscionable for the
vendor to retain the deposit, the land which has appreciated in value and still
retain all common law and equitable reliefs.

*Workers Trust and Merchant Bank Limited v Dojap Investments Limited

The case raises the question whether a deposit in excess of 10% paid, under a
Issue contract for the sale of land can be lawfully forfeited by the vendor in the event of
a failure by the purchaser to complete on the due date.
Workers Trust & Merchant Bank Limited (the Bank) as second mortgagee sold
premises at auction to Dojap Investments Limited (Dojap) at a price of
JA$11,500,000. The contract provided for the payment of a deposit of 25% of the
contract price and a deposit of $2,875,000 was duly paid by Dojap to the Banks
solicitors. The contract provided that the remainder of the purchase money should
be paid within 14 days of the date of the auction. The contract also provided that
the purchasers deposit would be forfeited on his failure to comply with any of the
conditions of the contract, one of which being that time was of the essence. The
purchaser/respondent failed to meet the completion date and his deposit was
forfeited.

The Court of appeal (Rowe, P., Forte, J.A. and Downer JA) held that Dojap was
entitled to relief from forfeiture to the extent that the deposit exceeded 10% of the
price but did not award any interest on that sum. The Bank appeals to the Board
against the decision of the Court of Appeal to give such relief against forfeiture.
Dojap cross-appeals claiming that it should have been awarded relief against
forfeiture as to the whole of the 25% deposit and should also have been awarded
interest.

Held: (i) in general, a contractual provision which requires one party in the event
of his breach of the contract to pay or forfeit a sum of money to the other is
unlawful as being a penalty, unless such provision can be justified as being a

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payment of liquidated damages being a genuine pre-estimate of the loss which
the innocent party will incur by reason of the breach. One exception to this
general rule is the provision for the payment of a deposit by the purchaser on a
contract for sale of land. The sum, however, has to be reasonable as earnest
money and not in truth a penalty intended to act in terrorem;

(ii) in the instant case, the evidence falls short of showing that it was
reasonable to stipulate for a forfeiture deposit of 25% of the purchase price. The
Court of Appeal in deciding thus, took the middle ground by ordering the
repayment of 15% out of the 25% deposit leaving the bank with the normal 10%
deposit which it is entitled to forfeit. Their Lordships are unable to agree that this is
the correct order. The bank has contracted for a deposit consisting of a globular
sum, being 25% of the purchaser price. If a deposit of 25% constitutes an
unreasonable sum and is not therefore a true deposit, it must be repaid as a whole.
The bank has never stipulated for a reasonable deposit of 10%, therefore it has no
right to such a limited payment. If it cannot establish that the whole sum was truly a
deposit, it has not contracted for a true deposit at all;
(iii) it appears that the bank may have suffered some damages as a result
of the respondents failure to complete. The sum has not been quantified, but if this
is so the bank is entitled to deduct the amount of such damages from the
deposit of 25%. Interest on the deposit is to be paid to the respondent at a rate
of 12% per annum.

Lord Brown-Wilkinson sated that it is not possible for the parties to attach the
incidents of a deposit to a payment of a sum of money unless such sum is
reasonable as earnest money.
-that the customary deposit of 10% existed in Jamaica but due to the requirement
to pay transfer tax of 7.5% within 30 days, vendors increased the contractual
deposit to 17.5%. It is this practice that caused the departure from 10%.

-since in the present case completion was supposed to take place within 14 days
of the contract, in the ordinary course completion would have taken place before

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the transfer tax was due and so there was strictly no need in the present case for
the bank to insist on the inclusion in the deposit a sum equal to the 7.5% of the
contract price so as to be in pocket to pay the tax when it fell due.

- that the evidence falls short of showing that it was reasonable to stipulate for a
forfeitable deposit of 25% of the purchase price or indeed any deposit in excess of
10%. As for the tax element, the Board do not suggest that it would be
unreasonable for a vendor to require advance payment of an amount sufficient to
discharge the liability of transfer tax on or before completion. But it does not follow
that such advance payment of tax should be capable of forfeiture if completion
does not take place. It is either not payable or is recoverable by the vendor and
returned to the purchaser

- 25% was an unreasonable amount and no tax requirement justified it.

Distinguish situation where purchaser was in possession of the property and had
derived benefits

If a situation exists where a purchaser is in possession of the subject matter of the

contract and has derived substantial profits from the subject matter, then fell into
hard times and defaulted, one has to examine the equities if the purchaser wants
back the money. Here the law would prevail.

See Stockloser v Johnson

In this case there was a contract for sale of quarry machinery to the plaintiff, the
purchase price to be paid by installments. The contract provided that in the event
of a default in payment of the installments, the vendor would retake the
machinery and all installments of the price previously paid should be forfeited.
Pursuant to the contract the plaintiff took possession and used the machinery but
defaulted in payment of an installment. The defendant forfeited the installments

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already paid. The purchaser who was financially unable and unwilling to
complete the contracts, claimed the return of the paid installments on the grounds
that the effect of the forfeiture clause was penal and unconscionable and in
equity he was entitled to relief.

Held: that the plaintiff was not entitled to relief in equity.

Lord Denning said the forfeiture clause was of a penal nature but it was not
unconscionable for the seller to retain the money. He said the buyer seems to have
gambled on the royalties being higher than they were. He thought that they
would go a long way to enable him to pay the installment but owing to bad
weather they turned out to be smaller than he hoped and could not find the
additional amount necessary to pay the installments.

He went on to say that he judge at first instance summarized the position neatly
when he said that the purchaser is in the position of a gambler who has lost his
stake and is now saying that it is for the court of equity to get it back for him. If it is
a question of what is unconscionable, or, to use a word with less legal flavour,
unfair, I can see nothing whatever unfair in the defendant retaining the money.

With that finding of the judge Lord Denning agreed that the purchase has no right
to restitution.

However, compare with an earlier authority which was cited in Stockloser v

Johnson.
Steedman v Drinkle
This case illustrates that equity can relief a buyer from forfeiture
The agreement was in effect a hire-purchase agreement of land. The purchase-
money was payable by installments over 6 years, completion to be at the end of
the six years, and meanwhile the purchasers were to be let into possession of the
land as tenants with the installments ranking as rent. In the case of default the
vendor was at liberty to cancel the contract and retain the payments which had
been made. The purchasers paid the first installment and went into possession, but

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they failed to pay the second installment and which was due at the end of the first
year. The value of the land had risen greatly during that year and the vendor
seized upon the purchasers default as giving him the opportunity to rescind the
contract. Without previous warning, the vendor gave notice canceling the
contract. The purchasers at once tendered the amount due but the vendor
refused to accept it.

The purchasers issued a writ for specific performance and meanwhile remained in
possession of the land taking the crops off it. They failed to get specific
performance in the first court, then succeeded in the Court of Appeal, but failed
again in the Privy Council on the ground that time was expressly of the essence in
the contract.

Nevertheless, the Privy Council relieved the purchasers from forfeiture of the sums
already paid. The purchasers would have to give credit for the crops they had
taken from the land during the three years or more that they had in possession, but
subject to that credit they would get their money back.

Note that Lord Denning in Stockloser v Johnson justified the decision in Steedman.
He said:
The basis of the decision in Steedman v Drinkle was, I think, that the vendor had
somewhat sharply exercised his right to rescind the contract and retake the land,
and it was unconscionable for him also to forfeit the sums already paid. Equity
could not specifically enforce the contract, but it could and would relieve against
forfeiture. (Note in this case the equities were not equal)

NON-MONETARY REMEDIES

INJUNCTION
An injunction is an equitable remedy available for torts and breach of contract. It is
a coercive form of remedy and so it is awarded at the discretion of the tribunal.

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Prohibitory and Mandatory Injunctions
A prohibitory injunction acts negatively, i.e. it orders the defendant not to do
something. A mandatory injunction acts positively, ie it orders the defendant to do
something.

Final and interim Injunctions

A final injunction, otherwise known as perpetual injunction, is one that is granted at
the trial of the action or other hearing in which final judgment is given. A final
prohibitory injunction is the appropriate remedy to prevent the continuation or
repetition of a tort eg nuisance, trespass, defamation etc. Likewise a final
mandatory injunction is the appropriate remedy to remove the effects of a tort
committed by the defendant; ie it compels the defendant to undo the wrong.

Interim injunctions
Interim injunctions, which may be prohibitory or mandatory, are injunctions given
prior to trial or other hearing in which final judgment is given, and are intended to
last until the trial at the latest. Although temporary in this sense their advantage, as
against final injunctions, is that they can be obtained quickly such as where the
claimant seeks to prevent a particular threatened act, it would be too late for the
claimant to wait until trial.

In American Cyanamid v Ethicon the House of Lords laid down the principles which
must be satisfied for an interim injunction to be granted. In this case the claimants
were seeking an interim injunction to prevent the defendants marketing in Great
Britain sterile sutures which they alleged infringed their patent. The House of Lords
restored the first instance decision that the injunction should be given but on
different reasoning, which was as follows:

First, the claimant must establish that there is a serious question to be tried; in other
words, that its claim is not frivolous or vexatious. But it should not be required to
establish a prima facie case.

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Secondly, assuming that it establishes that there is a serious question, the claimant
must go on to show that the balance of convenience favours granting the interim
injunction. In assessing this, the following sequential approach should be adopted.

(i) The court should ask whether damages would adequately compensate
the claimant for its interim loss and whether the defendant could pay them. If the
answer is yes, the interim injunction should be granted. ?????????
(ii) However, if the answer is no, the court should ask whether damages
payable under the claimants undertaking would adequately compensate the
defendant for its interim loss and whether the claimant could pay them . If yes,
there is a strong case for the interim injunction.
(iii) If, however, there is doubt as to the adequacy of the respective
damages, the case turns on the balance of convenience generally. The main
factor is whether it would cause greater hardship to grant or refuse the injunction.
Where this and other considerations are evenly balanced, two factors that can be
taken into account as a last resort are first, the desirability of maintaining the status
quo and, secondly, the strength of one partys case being disproportionate to that
of the other.

Applying this approach to the facts, an interim injunction was granted because
first, it was a serious question whether the defendants were infringing a patent of
the claimants so as to entitle the claimants to a final injunction at trial; and
secondly, the balance of convenience favoured the grant of the interim
injunction, particularly since the claimants monopoly of the market would
effectively be destroyed for ever if the interim injunction were refused.

SPECIFIC PERFORMANCE
Specific performance is an equitable remedy which enforces a defendants
positive contractual obligations; that is, it orders the defendant to do what he or
she promised to do. It is therefore a remedy protecting the claimants expectation

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interest, the justification for such protection resting ultimately on the morality of
promise-keeping..

REMEDY OF DECLARATION
While all remedies impliedly declare what the parties rights are, a declaration is a
remedy by which a tribunal simply declares the existence of a right after hearing
all the circumstances. This remedy is frequently sought in property disputes.

NON-COMPENSATORY DAMAGES

Non compensatory damages include nominal damages, restitutionary damages,

contemptuous damages and most importantly exemplary damages.

NOMINAL DAMAGES
Nominal damages have been defined as a trivial sum of money awarded to a
litigant who has established a cause of action but has not established that he is
entitled to compensatory damages. In most cases, to establish a cause of action,
the plaintiff must prove not only that the defendant was under an obligation
towards him, and was in breach of that obligation, but also that he (the plaintiff)
had sustained some loss as a result of the breach. In a limited number of cases
however he need not prove loss. His right of action accrues on the mere breach of
obligation: it is actionable per se. So a man shall have an action against another
for riding over his ground, though it do him no damage; for it is an invasion of his
property and the other has no right to come there.

Cases giving rise to nominal damages

There are two conditions to be satisfied:
1) The tort in question must be actionable per se- such torts generally involve a
direct interference with the personal or proprietary security of the plaintiff. For

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example, trespass to person, goods or land, defamation, malicious prosecution,
interference with contract, and interference with intangible interests such as trade
marks, or copyright.
2) Loss to the plaintiff must be neither proved nor presumed. Damages for
torts actionable per se are said to be at large (not limited to the amount of
pecuniary loss). Only where the court considers that the plaintiff has suffered no
loss, will it award him nominal damages.

Functions of nominal damages

1) Nominal damages may be served as a declaration of a legal right. However, this
purpose has been taken over by the right of declaration.

2) Another function is that it may serve as A mere peg on which to hang costs.
Even though the plaintiff is unable to prove actual loss, he may wish to force the
action to a successful conclusion so that he may recover his costs from the
defendant. This function has been disputed judicially. It has been doubted
whether a plaintiff who is awarded nominal damages is successful.

Restitutionary measure
Account of profits/restitutionary damages
Here the aggrieved party had suffered no loss but instead of awarding nominal
damages the tribunal embraces the restitutionary principle.
Underlying this principle is the idea that bargains must be kept. If a contract is
breached or a tort (eg trespass on land to view sporting event which otherwise
would have cost trespasser) is committed which results in the contract-breaker or
the tortfeasor benefiting, then any profits made by the contract-breaker or the
tortfeasor can be recovered under the restituinonary principle. Therefore, a
claimant can recover any such profits even though he suffered no loss.

See Attorney General v Blake

In this case, the notorious spy, George Blake, had written his auto biography in
1989. The publishers had agreed to pay him advance sums for royalties on signing

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the contract, delivery of the manuscript and publication. He was paid a part of
that sum but the Crown, through the Attorney General, sought to stop him from
receiving the balance owing. The Crown claimed that Blake was acting in breach
of fiduciary duty owed by an ex-employee to the crown and that there was a
breach of confidence.

The House of Lords held that Crown could recover damages under the private law
remedy of restitutionary damages for breach of contract.
The argument that succeeded was based on the fact that, while there was no
cause of action for breach of fiduciary duty or breach of confidence, there was a
cause of action for breach of contract. Blake had expressly undertaken at the
beginning of his employment not to publish, during or after his employment with
the Secret Service, any official information gained by him as a result of that
employment. And, although the normal remedy for breach of contract is
damages, compensating the claimant, this was regarded as an exceptional case
where an account of profits, aimed at disgorgement of the gains made from
breach of contract, could and should be awarded.

Lord Nicholls stressed that an award would be exceptional and should only be
made where the standard remedies for breach of contract of compensatory
damages or specific performance or an injunction were inadequate. He said:

An account of profits will be appropriate only in exceptional circumstances.

Normally the remedies of damages, specific performance and injunction, coupled
with the characterization of some contractual obligations as fiduciary, will provide
an adequate response to a breach of contract. It will be only in exceptional
cases, where those remedies are inadequate, that any question of accounting for
profits will arise. No fixed rules can be prescribed. The court will have regard to all
the circumstances, including the subject matter of the contract, the purpose of the
contractual provision which has been breached, the circumstances in which the
contract was breached, the consequences of the breach and the circumstances
in which relief is being sought. A useful general guide, although not exhaustive, is

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whether the plaintiff had a legitimate interest in preventing the defendants profit-
making activity and, in depriving him of his profit.

Note Lecturers instructions: A claim for restitutionary damages is not compensatory

damages. Restitution and compensation are not identical and cannot be
claimed at the same time.

CONTEMPTOUS DAMAGES
These are mostly awarded in defamation cases and are damages of a very small
amount usually of the lowest coin of the realm whose function is to indicate
that, while the defendant has committed the alleged wrong (including a tort
actionable only on proof of damage) the claimant deserves no more than a
technical infringement of his rights, because of his own conduct the matter. In
other words the derisory award amounts to a declaration of the claimants rights
combined with an admonition of the claimant. For example, where a claimant
having the same name as another person sues a defendant news paper for libel
even though the newspaper was not referring to the claimant, such claimant
would be awarded contemptuous damages.

PERSONAL INJURY

Personal injuries may be inflicted by means of a large number of very different torts.
Although the tort of negligence qualifies to take easily the largest share, personal
injuries may result from trespass to the person or from nuisance, by reason of
dangerous premises, chattels or animals in the defendants control, from his non-
natural user of land, from breach of statutory obligation giving rise to claim in tort.
Personal injury may indeed also occasionally arise from breach of contract, as a
contract of carriage or sale of goods or for breach of contract in the provision of
services.

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ASSESSMENT PROCESS
The general compensatory aims dictate that damages should put the claimant
into as good a position as if the personal injury had not occurred ( i.e. the normal
measure in tort, note also that personal injury is not a cause of action). In so
doing, damages are awarded for several heads of loss, both pecuniary and non-
pecuniary.

Pecuniary loss
This comprises two separate items, namely:
1) the loss of earnings and other gains which the plaintiff would have
made had he not been injured;
2) and the medical and other expenses to which he is put or will be put as
a result of the injury (past and future)
Note also that handicap on the labour market or Smith v Manchester damages
may be claimed as general damages

Non-pecuniary /personal loss

The courts have sub-divided the non-pecuniary losses into two heads or
categories, namely:
1) pain and suffering;
2) and loss of amenities of life.

*Cornilliac v St Louis
This case illustrates the principles what a tribunal should take into account in
assessing damages (general damages) for personal injuries.

Facts
As a result of the respondents negligent driving of a motor vehicle, the appellant
fractured his hand. Throughout his stay at a nursing home for 12 days after the
accident he suffered intense pain and for 18 months thereafter he continued to
suffer pain but in diminishing intensity over the period. The fractures eventually
healed but the range of movement of his hand was limited to twenty degrees. In

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addition, arthritis had set in, it was likely to get worse and he was no longer able to
play the musical instruments (piano and saxophone) he was fond of playing.

The appellant was 48 years old at the time of the accident (1958) and earned a
salary of $865 per month as assistant superintendent in charge of cementing, being
groomed to take over the superintendents job. But for his disability he would have
been promoted to that job with a salary of $1250 per month. His junior got such job
and he was put in charge of another area earning $1050 per month (more than
what the job he was doing was worth).

The trial judge awarded $7500 general damages and 1035.80 special damages.
On appeal against the inadequacy of the general damages awarded the
appellant maintained that they were a wholly unrealistic estimate of the damage
sustained by him. The respondent contended, inter alia, that it was not open on
the pleadings for any regard to be had to the appellants loss of pecuniary
prospects since he had made no averment therein specifying his occupation, his
pecuniary prospects and the extent to which they had been affected.

The Court of Appeal held:

(i) no such averment was necessary since the loss of pecuniary prospects was not
an item of special damage but one of the class of items to be taken into
account in the assessment of general damages.
(ii ) the considerations which ought properly to have been borne in mind in
assessing the general damages were:
(i) the nature and extent of the injuries sustained;
(ii) the nature and gravity of the resulting physical disability;
(iii) the pain and suffering endured;
(iv) the loss of amenities suffered, and
(v) the effect on pecuniary prospects.

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(iii) the sum awarded as general damages was a wholly unrealistic estimate of the
damage sustained by the appellant and ought to be increased to $21,000.

Wooding CJ said that in order to succeed, the appellant must show that the
amount awarded was so inordinately low as to be a wholly erroneous estimate of
the damage sustained. The facts must be looked at under each head:

Nature and extent of the injuries sustained

(1) The appellant sustained a broken arm (compound, comminuted, complicated
fracture of the right humerus in the middle of the shaft and a fracture of the upper
end of the radius and the ulna at the right elbow).
(2) He suffered from shock and hemorrhage.
The injuries were so extensive that he thought his right arm would be amputated
but it was avoided by surgery.

Nature and gravity of the resulting physical disability

The fractures healed with a residuum of deformity. Present range of movement of
his arm is twenty (20) degree and so the appellant is unable to touch his face and
therefore to shave or feed himself or discharge any ordinary functions involving a
range of movement with his right hand and in addition the hand has lost some of
its grip.

Pain and suffering endured

He endured intense pain for 12 days following the accident, so intense that he had
to be given sedatives. Over 18 months he suffered pain but it diminished in
intensity.

Loss of amenities suffered

He was an active physically fit outgoing man aged 48 at the time of accident. He
used to enjoy playing music, jazz and calypso both on saxophone and piano but

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he cannot play them anymore. Outdoor activities are limited and fun and sparkle
are gone from his life.

Effect on pecuniary loss

His future job prospects were bright. Normal age of retirement was 60 years. Could
have gotten superintendents job in 1962 and so appellant lost the prospect of
being 8 years in the post.
In light of such considerations Wooding CJ found that substantial compensation for
such items of loss should be awarded.
(Note when advising claimant in a personal injury matter one must assess recovery
of general damages in light of the principles laid down in Cornilliac)

HEADS OF DAMAGE
Pecuniary Losses
(1) LOSS OF EARNINGS
(i) The plaintiff is entitled to damages for the loss of his earning capacity resulting
from the injury. This generally forms the principal head of damage in a personal
injury action. Both earnings already lost by the time of trial and prospective loss of
earnings are included. The rules of procedure require that the past loss (wages or
salaries lost) be pleaded as special damage and the prospective loss (loss of future
earnings) as general damage.

Multiplier Multiplicand Method of Quantification -Calculating the amount for loss of

future earnings

Method of quantification
Loss of future earnings is calculated by multiplying the lost net average annual
income (the multiplicand) by the number of years during which the loss will last (the
multiplier). Thus the various contingencies affecting the multiplicand and the

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multiplier will apply and so the multiplicand will include an allowance for any
prospect of increased earnings, while the multiplier must be scaled down to
account for first, the contingencies of life, and secondly, the advantage of
receiving a capital sum now instead of income over a prolonged period.

The multiplicand
This amount is calculated by taking the amount of the plaintiffs present annual
earnings less the amount, if any, which he can now earn annually. So, an award of
damages for future losses involves two predictions:
(1) what would the plaintiff have earned if he had not been injured?
(2) what is he likely to earn?
These two considerations involve elements of uncertainty which must be taken into
account in quantifying the loss. Thus under (1) such contingencies as sickness,
disablement, strikes and unemployment will go to reduce the award. Of the factors
tending to increase the award, the plaintiffs prospects of promotion provide the
clearest example. Inflation may also increase the award.

The multiplier
This is subtracting the plaintiffs age from his age of retirement. This figure may be
while, based upon the number of years during which the loss of earning power will
last, is discounted so as to allow for the fact that a lump sum is being given now
instead of periodical payments over the years as well as other contingencies such
as if the person is high- risk.

Illustration 1
P, a planning engineer aged 32 is totally disabled by injuries sustained in an
accident for which D is liable.
Earnings at time of accident (including insurance and pension rights) = L1,
211
taking into account prospects of promotion = L1,325
Working life expectancy form date of trial (when aged 36) = 29

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 Scaled down to account for (i) contingencies and (ii) receipt of
lump sum = 14
Award of lost future earnings = L1, 325 x 14 = L18,
550

Illustration 2
*Seepersad v Persad
The appellant, who was born in 1963 and was 40 years old, carried on business as a
taxi driver and part-time mechanic in Trinidad. He was driving his taxi along a road
when a vehicle driven by the first respondent Persad, ran off the fly-over bridge
under which the appellant was driving and fell some 50 ft on top of the appellants
taxi. Two persons were killed in his taxi, his taxi was damaged beyond repair and
the appellant himself sustained injuries.

Injuries
The appellant suffered concussion in the accident, but did not have any lasting
sequelae head injury. His main injuries were to his back, in two spinal areas. He
sustained wedge compression fractures of the L1 and T12 vertebrae, which
appeared to have healed without lasting effects. The L5/S1 disc was prolapsed,
which has been the major cause of his continuing pain and incapacity.
Immediately after the accident he complained of severe pain in the neck,
thoracic and lumbar areas, and was detained in hospital for five days, after which
he attended as an out-patient.

Judgment in default of defence was entered and damages were assessed. An

amount was awarded at first instance which included amounts for pain and
suffering and loss of amenities and loss of future earnings. Total award $290,491.
The respondents appealed saying amount for pain and suffering and loss of
amenities was too high (150,000), that it exceeded the limit awarded for
comparable cases in T& T ( 40,000 to 120,000). The Court of Appeal reduced the
amount of general damages to 75,000 and sum was said to include a small

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amount for future medical treatment. A multiplier of 10 was used to assess loss of
future earnings. Total damages increased to $445,778. However the appellant was
only awarded half the cost of his appeal. He further appealed to the Privy Council.

The Privy Council held:

(1) the amount awarded for pain and suffering and loss of amenities will not
be disturbed because it is based on the appellate judges view of the general level
of award within the jurisdiction, although the award for pain and suffering and loss
of amenity should not have included an element (unquantified small amount) for
future loss in respect of medical treatment and medication which, being a
substantial item in this case, should have been dealt with as a separate head of
loss.
(2) That fixing the multiplier for the purpose of assessing future loss of earnings
at 10 the Court of Appeal had failed to state its reasoning; the multiplier should be
fixed so as to give proper compensation to the appellant, taking into account
interest rates within the jurisdiction and making allowance for the contingencies of
life; a multiplier of 16 would be more appropriate in this case (which, when applied
to the multiplicand of 32,240, would result in an award of 515,840 for future loss of
earnings
(3) That although the agreed award for special damage included a
significant sum for medical treatment and medication and it appeared likely that
there would be some continuing expense of this nature, it was not possible to form
an accurate and verifiable estimate of the future costs; accordingly, a sum of
100,000 would be allowed, reflecting the possibility of future costs under this head
on similar lines to the well-established approach to valuing loss of employment
capacity; this would bring the total award to 831,618

Assessment of damages in the instant case

The factors below were rightly considered by the Court of Appeal in assessing pain
and suffering and loss of amenities.
Expert evidence from a doctor showed:

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1) that the appellant sustained back injuries as stated above. He did not
undergo any surgical treatment and could not operate his taxi as a full time taxi
driver or as a mechanic.
2) He suffered restricted mobility and could not lift heavy objects
3) He is unable to take part in the limited recreational activities he enjoyed
before the accident but he can lift his infant child or take walks with her as well as
drive his car

Arriving at multiplicand
The Privy Council accepted the Court of Appeals assessment. The appellants pre-
accident earnings were valued at 1240 per week, or 64,480 per annum. Half of that
figure gave a multiplicand of 32, 240. This was so because the appellant could still
work but only half the time he used to work before.

Arriving at multiplier
There was no set retirement age for taxi men but after taking account of the need
to give proper compensation to the appellant, taking into account interest rates in
T & T and making some allowance for the contingencies of life, a figure of 16years
was found to be appropriate.

Loss of future earnings

In applying the multiplier of 16 to the multiplicand of 32,240 loss of future earnings
came to 515,840

(2) HANDICAP ON THE LABOUR MARKET *SMITH V MANCHESTER DAMAGES

The injured person may also recover for handicap on the labour market if the
circumstance of his injuries discloses that he will suffer such handicap. There
question of whether the Smith award can be made is a question of fact
determined on the circumstances of the case. Two conditions must be satisfied:
(1) the claimant must still be employed

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(2) there must be a reasonable and not a fanciful risk that he may be thrown
on the labour market to compete with other healthy bodied persons who are
seeking employment.
So, if the claimant is employed and reasonably fears he will be thrown on the
labour market he can recover Smith v Manchester Damages. Other wise, he
cannot recover for handicap on the labour market.

(3) MEDICALAND RELATED EXPENSES

Past losses incurred for medical treatment
The plaintiff is entitled to damages for medical expenses reasonably incurred by
him as a result of the injury. (Note the claimant has a duty to mitigate damage
caused to him) Expenses of medical treatment, of attendance of doctors and
nurses, of medicines and appliances, of hospital fees, of transportation to hospital,
of nursing attendance between the place of injury and the plaintiffs home are all
recoverable.

Future loss in respect of medical treatment and medication

This is calculated by multiplying the cost of medication per annum by the multiplier
(in this case the remainder of the natural life of the claimant .i.e the claimants
estimated life span minus his age at the time of the accident)

Related Expenses
The plaintiff is also entitled to recover for any other expense which he can show
resulted from the injury. Not all these expenses can be classified strictly as medical.
Thus it is common to allow the plaintiff recovery of the expenses of relatives in
visiting him in hospital on the basis that this will speed his recovery. He may also
recover increases for living expenses and special accommodation expenses etc.

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NON-PECUNIARY / PERSONAL LOSSES
Pain and suffering and loss of amenities
Where the injuries suffered by the claimant is not really serious pain and suffering
and loss of amenities should be linked and are not to be calculated differently.

(1) PAIN AND SUFFERING

Pain and suffering is the first of the two main heads of non-pecuniary loss. Both
past and prospective pain and suffering are covered, although the past loss is not
claimed as special damage in the pleadings as it is not quantifiable with
exactitude. Past and prospective loss are therefore claimed together as general
damage.

Ascertaining the extent of pain and suffering

According to lecturer: one cannot measure pain and suffering but one can
consult the medical report to try and ascertain if the claimant was experience
excruciating pain. One must consider: (see Cornilliac above and Seeperad)
1. the treatment given how the claimant had to be sedated and so must
look at the quantum of pain killers administered
2. consciousness of claimant- if the claimant was unconscious this would be
suggestive that the claimant was not feeling pain but this could suggest serious
head or spinal injury.
3. whether the treatment has increased the pain,, for example the
administration of injection or whether physiotherapy to a broken arm or leg has
inflicted pain while relieving it

(2) LOSS OF AMENITIES

Loss of amenities of life is the second of the two main heads of non-pecuniary loss.
As with pain and suffering, past and prospective loss are both covered, but with
the total loss again claimed as general damage. This head of general damage
concentrates on the curtailment of the plaintiffs enjoyment of life not by the
positive unpleasantness of pain and suffering but, in a more negative way, by his

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inability to pursue the activities he pursued beforehand. Birkett L.J. put it thus in
Manley v Rugby Portland Cement Co.

There is a head of damage which is sometimes called loss of amenities; the man
made blind by the accident will no longer be able to see the familiar things he has
seen all his life; the man who has had both legs removed and will never again go
upon his walking excursions- things of that kind- loss of amenities

Every person which is injured will be able to claim such loss. Circumstances which
clearly point to loss of amenities:
(1) the fact that the injured person is unable to walk
(2) person has to remain in bed for a particular time

Pain and suffering subjective but loss of amenities is objective

Note that pain and suffering is subjective but loss of amenities is objective. So, the
claimant must experience pain and suffering to be awarded damages for it but
will be awarded damages for loss of amenities once the circumstances exist even
if he is not aware of his circumstances.

*Leonard (an infant) v Forbes (Cornilliac v St Louis applied)

Illustrates that pain and suffering is assessed subjectively so that if the claimant is
not capable of experiencing the pain or suffering no damages will be awarded for
pain and suffering. In this case the claimant was aware of his condition but
experienced no pain and suffering.

The appellant, a youth aged 15, was injured as a result of the negligent driving of
the first respondent an employee of the second respondent. In the accident
which occurred on 31 October 1966, the appellants skull and ribs were fractured
and his brain and nerve tracts were permanently damaged so that he is now a
spastic. He has been a patient in hospital ever since and was deeply unconscious
for five months as a result of the accident.

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First instance

In a claim for damages for personal injuries brought by the appellant against the
respondents it was established at the trial that although the appellant did not suffer
any pain there is no chance whatever of his leading a normal life; his life
expectancy is the same as it was before the accident and that he is able to
appreciate his condition. The trial judge also found that the plaintiff had suffered
the loss of all the amenities of life and that he would be dependent upon the care
of others throughout the balance of his life. The trial judge awarded the appellant
$3,118.32 special damages and $5,000 general damages.

On an appeal complaining of the inadequacy of the damages awarded it was

contended as regards the general damages that the trial judge erred in principle
in not taking into account the appellants loss of prospective earnings and that in
any event the sum awarded was wholly inadequate.

Held: the award of general damages would be increased to $37,000 for the
following reasons:

(i) a person in the position of the appellant is entitled to reasonable compensation

not only for the severe physical injuries he has sustained, but also in respect of the
grave and sombre deprivations which he will suffer throughout his life, and that as
the trial judge has found he has suffered the loss of all the amenities of life
substantial compensation should be awarded, and more so as he has a long
expectation of life and is able to appreciate his condition;

(ii) an award must also be made to meet the special need to provide for
continuous care for the appellant over a long period of time;

(iii)the appellant, though a casual worker, has been forever deprived of the
opportunity to earn his wages, however small, and to improve his earning capacity
in employment.
Lewis CJ said:

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Although the trial judge did not specifically mention the various heads as set out
in Wooding CJs judgment, his evaluation of the evidence indicates that he took
account of them. He particularly states that the appellant was a casual employee
with a low income, that there is no chance of his leading a normal life, and that he
would need constant care as he could not look after himself. The conclusion to be
drawn from these findings must be that for the rest of his life he would be unable to
work and that his loss of future earnings must be assessed on the basis of a low
income.

He went on to say:
Although the plaintiff according to the medical evidence did not suffer pain yet
he was very seriously injured and has suffered a loss of all the amenities of life. I
have already referred to the appellants spastic condition. No regeneration of the
nerves is expected. The appellant is aware that his prospects for the future are
hopeless, for he said in his evidence: I am in the hospital for I was licked out of this
world. I thought I was dead. According to the medical evidence he is mentally
alert and willing but cannot do what he wants to do because of the brain
damage. His frustration must be well nigh intolerable. He has no sense of balance
when standing. He was trained by his father, a sea captain, to sail a boat, but will
never be able to enjoy the pleasures of sailing. He used to play cricket and drive a
car, but now he cannot even walk without assistance.

The medical evidence establishes that the appellants expectation of life has not
been shortened. At the age of 19 he must therefore look forward to a broken
barren life beset with frustrations. His utter dependence upon the care of others
must add to his distress and anxiety.

A plaintiff in the position of the appellant is entitled to reasonable compensation

not only for the severe physical injuries he has sustained, but also in respect of the
grave and sombre deprivations which he will suffer throughout his life.

Unconscious claimant still recovers for loss of amenities

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As it relates to the unconscious plaintiff, someone in a persistent vegetative state,
as seen first in *Wise v Kaye in the Court of Appeal and soon after in *West v
Shephard in the House of Lords, both courts held that damages for loss of amenities
were not to be based upon loss of happiness and that the plaintiffs ignorance of
the loss suffered was no ground for reducing the damages. In the former an award
for loss of amenity was upheld for L15,000 and in West v Shephard an award for
L17,500 was upheld. The claimants in such cases had been very seriously injured
and brain damaged and was totally, or almost, incapable of appreciating their
loss.

In West v Shephard Lord Morris said:

An unconscious person will be spared pain and suffering and will not experience
mental anguish which may result from knowledge of what has in life been lost or
from knowledge that life has been shortened.. The fact of unconsciousness is
therefore relevant in respect of and will eliminate those heads or elements of
damages which can only exist by being felt or thought or experienced. The fact of
unconsciousness does not, however, eliminate the actuality of the deprivations of
the ordinary experiences and amenities of life which may be the inevitable result of
some physical injury.

(3) DISABILITY
The claimant may suffer physical disability, mental or psychological impairment.
A leg might have shortened, inability to use arm or a scar may be left on the
claimant.
There must be an assessment of the physical disability by a Specialist. The medical
report must be evaluated in accordance with the principles in Cornilliac v St Louis .
This is to ensure a proper assessment of the claimants disability which would
enable counsel to make the necessary claims before the court or to settle out of
court.

Scars

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The claimant must act reasonable in mitigating the effect of the defendants tort.
He must seek cosmetic surgery in order to reduce the scar. If he does, he can
recover as special damages a reasonable amount spent or should be spent on
doing surgery. He can also recover as general damages an amount for any
residue of the scar.

(4) LOSS OF EXPECTATION/ SHORTENING OF LIFE

Lecturers instruction: Unless told there is a shortening of life do not address the
issue. Normally you would get such evidence from the medical report. If there is
evidence of shortening of the life span of the claimant, this will affect the claimant
who is aware of this shortening and it will increase the suffering. However, such
head of damage has been abolished in some jurisdictions. In those jurisdictions
which still have it, only a conventional sum is awarded for shortening of life. This is
so because it is difficult to place a value on ones life and in any case the claimant
would have been compensated under the other heads of damage.

COUNCIL OF LEGAL EDUCATION

NORMAN MANLEY LAW SCHOOL

REMEDIES

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CASE LIST

DAMAGES

Non-Compensatory Measures

AG v. Blake [2001] AC 268 @ 283 - Lord Nicholls of Birkenhead

Remedies available for breach of contract the basic remedy is an award of
damages. Where a party sustains loss by reason of a breach of contract, he is,
so far as money can do it, to be placed in the same position as if the contract
had been performed. Damages are compensatory. Specific remedies are
discretionary.

The court may decline to grant specific relief on the ground that this would be
oppressive. Likewise, the court will compel the observance of negative
obligations by granting injunctions.
- Property rights are superior to contractual rights in that, unlike
contractual rights, property rights may survive against an indefinite class
of persons.
- However, it is not easy to see why, as b/w the parties to a contract, a
violation of a partys contractual rights should attract a lesser degree of
remedy than a violation of his property rights.
The Wortham Park case still shines, rather as a solitary beacon, showing that in
contract as well as tort damages are not always narrowly confined to
recoupment of financial loss. In a suitable case damages for breach of
contract may be measured by the benefit gained by the wrongdoer of the
breach. The defendant must make a reasonable payment in respect of the
benefit he has gained. Circumstances do arise when the just response to a
breach of contract is that the wrongdoer should not be permitted to retain any
profit from the breach. My conclusion is that there seems to be no reason, in
principle, why the court must in all circumstances rule out an account of profits
as a remedy for breach of contract. Remedies are the laws response to a
wrong (or, more precisely to a cause of action). When, exceptionally, a just
response to a breach of contract so requires, the court should be able to grant
the discretionary remedy of requiring a defendant to account to the plaintiff for
the benefits he has received from his breach of contract.
- Damages are not always a sufficient remedy for breach of contract.
- This is the foundation of the courts jurisdiction to grant the remedies of
specific performance and injunction.
- Damages are measured by reference to the benefit obtained by the
wrongdoer.
- An account of profits is ordered in preference to an award of damages.

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 - Sometimes the injured party is given the choice: either compensatory
damages or an account of the wrongdoers profits. Breach of
confidence is an instance of this.
Normally the remedies of damages, specific performance and injunction,
coupled with the characterisation of some contractual obligations as fiduciary,
will provide an adequate response to a breach of contract. It will be only in
exceptional cases, where those remedies are inadequate, that any question of
accounting for profits will arise.
- No fixed rules can be prescribed.
- The court will have regard to all the circumstances, including the subject
matter of the contract, the purpose of the contractual provision which
has been breached, the circumstances in which the breach occurred,
the consequences of the breach and the circumstances in which relief is
being sought.
- A useful general guide, though not exhaustive, is whether the plaintiff
had a legitimate interest in preventing the defendants profit-making
activity and, hence, in depriving him of his profit.

Constantine v Imperial London Hotels Ltd

The defendants, who were innkeepers, refused without any just cause to
accommodate the plaintiff, who was, however, accommodated at another
hotel of which the defendants were the proprietors. The plaintiff brought this
action for wrongful refusal to receive him as a guest but did not allege or claim
any special damage:

Held (i) the action was maintainable without proof of special damage; but, in
the circumstances of the case, the plaintiff was only entitled to nominal
damages.
(ii) the fact that the plaintiff was received in another hotel in the same
ownership was no defence, having regard to the circumstances in which he
was refused admission to the first hotel.

Smith and Smith v Hilton International Barbados and Gill 12 Barb L.R. 21

Rookes v. Barnard [1964] AC 1129

The tort of intimidation was an established tort. It comprehended not only
threats of criminal or tortuous acts, but threats of breaches of contract.
If persons combined to do acts which they knew would cause loss to a plaintiff
by threat to commit a tort against a third person if he did not comply with their
demands that was using unlawful means to achieve their object. (Per Lord
Reid)

Exemplary damages could be awarded in cases:

(i) Of oppressive, arbitrary or unconstitutional acts by government
servants

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 (ii) Where the defendants conduct had been calculated by him to
make a profit for himself which might well exceed the compensation
payable to the plaintiff
(iii) Where expressly authorised by statute.
In a case in which exemplary damages were appropriate a jury should be
directed that only if the sum which they had in mind to award as compensation
(which might of course be aggravated by the defendants behaviour to the
plaintiff) was inadequate to punish and deter him, could it award some larger
sum.
The plaintiff, could, w/o any departure from the compensatory principle, invite
the jury to look at all the surrounding circumstances and award a round sum
based on the pecuniary loss proved.

Cassell & Co Ltd v Broome (No.2)

A wrote a book entitled The Destruction of Convoy PQ17. The book was about
one of the great naval disasters of the second world war in which a large
number of merchant vessels in convoy PQ17 were destroyed and many lives
lost. B was the officer commanding the naval ships escorting the convoy at the
time of the disaster. The book placed the blame for the disaster on B, and
contained grave imputations on his conduct. In writing the book A knew fully
what he was doing and persisted with it in spite of repeated warnings from the
most authoritative sources that the relevant passages in the book were
defamatory of B. As view was that it was possible to say some pretty near the
knuckle things about B and others involved in the episode but if one says it in
a clever enough way, they cannot take action. Nevertheless As thesis was
stated sufficiently plainly for an experienced publisher to understand perfectly
well its meaning. As original publishers, W K Ltd, refused to publish the book on
the ground that it was a continuous witch hunt of B. They had been advised
that the book reeks of defamation. A then offered the book to C Ltd who
agreed to publish it. C Ltd were warned by W K Ltd that they had rejected the
book on the ground that it was libellous. B himself also warned C Ltd on several
occasions that if they published the book without substantial modification they
must expect an action for libel from him. Nevertheless C Ltd went ahead and
published a hardback edition of the book with a dust jacket, the advertisement
on which in terms indicated that C Ltd were well aware of the full implication of
the passages complained of and were prepared to sell the book on the basis
of this sensational interpretation of the naval disaster. B issued a writ for libel
against C Ltd and A and included in his reamended statement of claim the
following plea: [B] will assert that the defendants and each of them calculated
that the money to be made out of the said book containing the passages
complained of would probably exceed the damages at risk (if any) and that
[B] is consequently entitled to exemplary damages. In his summing-up the
judge directed the jury that having considered whether B was entitled to
compensatory damages they were to go on and ask whether B had proved
that he was entitled to exemplary damages and to ask, What additional sum
should be awarded him by way of exemplary damages? The judge asked
them to underline the word additional because he wanted to know how

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much more do you award over and above the compensatory damage. He
also directed the jury that they should award a single sum by way of exemplary
damages and stated that, if they were to ask whether they should award a
larger sum against one of the defendants if they thought him more
blameworthy, the answer to that question was No. He further explained that a
single sum was to be awarded against both defendants. The jury, having found
that the words complained of were defamatory and untrue, awarded B
damages of 40,000 against both defendants, assessing the compensatory
damages at 15,000 and the exemplary damages at 25,000. A and C Ltd
appealed against the award of damages contending inter alia that the
judges direction on the question of exemplary damages failed to comply with
the requirements laid down by the House of Lords in Rookes v Barnard ([1964] 1
All ER 367). The Court of Appeal ([1971] 2 All ER 187) dismissed the appeal,
holding that the decision of the House in Rookes v Barnard ([1964] 1 All ER 367)
was not good law since it had been arrived at per incuriam and without
argument on the point by counsel. The court further held that in any event the
judges direction complied with the requirements of Rookes v Barnard ([1964] 1
All ER 367). C Ltd appealed on the question of exemplary damages to the
House of Lords.

Held (i)(Viscount Dilhorne and Lord Wilberforce dissenting) The decision of the
House in Rookes v Barnard ([1964] 1 All ER 367) had correctly formulated the
principles of law governing the circumstances in which exemplary damages, ie
damages by way of punishment of the defendant in excess of those necessary
to compensate the plaintiff for the injury done to him, might be awarded to a
plaintiff in the case of certain torts; the principles enunciated in that decision
were applicable to defamation cases; the decision could not be said to have
been made per incuriam since it had been arrived at after a full consideration
of the authorities and the House was not bound to limit its conclusions within
any formulation which counsel had thought fit to formulate (see p 807 f, p 823
c, p 827 d to g, p 833 j, p 835 j to p 836 a, p 841 g and h, p 842 h, p 846 f, p 847
c, p 870 f and g, p 872 c, p 873 d and e, p 875 a and b and p 877 f, post).
Rookes v Barnard [1964] 1 All ER 367 followed.

Drane v. Evangelou [1978] 2 All ER 437

Plaintiff was the tenant of a furnished flat owned by defendant and let to
plaintiff at a rent of 25 per week. In July 1975 plaintiff applied to a rent officer
to fix the rent. Before the rent was fixed defendant served a notice to quit on
plaintiff which was ineffective because of the statutory protection from eviction
afforded to plaintiff. On October 8 the rent officer fixed the rent of the flat at
16 per week. On October 14, while plaintiff was out, three associates of
defendant entered the premises, put plaintiffs belongings outside in the back
yard and prevented him from entering the flat. Defendants parents-in-law
moved into the flat while plaintiff was forced to reside with friends and store his

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belongings in a garage. On October 28 plaintiff issued a claim in the county
court alleging that defendant had interfered with the right of plaintiff . . . to
quiet enjoyment of the . . . premises by unlawfully evicting [him] from the . . .
premises and seeking (i) an order for delivery up of possession to plaintiff, (ii)
injunctions to restrain defendant from preventing plaintiff gaining readmittance
to the flat, from interfering with plaintiffs right to quiet enjoyment of the
premises, and from harassing plaintiff, and ordering defendants parents-in-law
to quit the flat, and (iii) damages limited to 1,000. On October 31 plaintiff
obtained an injunction compelling defendant to restore him to the property.
Defendant refused to comply with it or with a further injunction until plaintiff
instituted committal proceedings for breach of the injunction. On January 1,
1976 plaintiff regained possession of the flat having been kept out of
occupation for a period of 10 weeks. On September 14, 1976 plaintiffs action
was heard in the county court. At the end of the evidence defendant
submitted that the claim was for breach of a covenant for quiet enjoyment
and that exemplary damages could not be awarded. The judge stated that
the facts were sufficient to found a claim in trespass and awarded damages of
1,000 to plaintiff. Defendant appealed, contending, inter alia, that plaintiff
was not entitled to exemplary damages because the particulars of claim had
not pleaded a claim in trespass and had not expressly claimed exemplary
damages:
Held the appeal would be dismissed because (1) the judge was entitled of his
own motion to raise the issue of trespass even though it had not been pleaded,
because the facts were sufficient to warrant a claim for trespass and as they
were set out in the particulars of claim defendant could not claim that he had
been taken by surprise when the judge raised the issue; (2) a claim for
exemplary damages did not have to be specifically pleaded in the county
court because there was no rule in the county court rules equivalent to RSC
Order 18 rule 8 (3), which required a claim in the High Court for exemplary
damages to be specifically pleaded. Furthermore, in the county court
defendant had not raised the defence that exemplary damages should be
specifically pleaded and therefore would not be permitted to raise it on
appeal; (3) defendants conduct in unlawfully evicting plaintiff in the manner in
which he did was a grave wrong which justified an award of 1,000 damages
either as exemplary damages because defendant had acted with a cynical
disregard of plaintiffs rights in seeking to gain, at the expense of plaintiff,
property which he coveted and which he could not otherwise obtain and
because it was a case in which it was necessary to teach defendant that tort
did not pay, or as aggravated damages. Although the judge had not
approached the award of exemplary damages in the same way as a jury
should be directed to approach such an award, the award was not excessive
in the circumstances.

AG for St. Christopher v. Reynolds [1979] 3 All ER 129

When exemplary damages were awarded, the amount of such damages was
not required to be specified separately from the amount of compensatory

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damages awarded. The Board would not therefore interfere with the award of
damages to the plaintiff on that ground and there were no other grounds on
which the Board was justified in interfering with it.

Marshall v. Semper

The plaintiff M was a shop detective. S. was a sergeant and the two other
defendants were corporals in the Special Reserve Police. In the course of his
duty the plaintiff apprehended the wife of S for shop-lifting and took her before
a director of the shop. She was not prosecuted. Less than a week after this
incident S accosted M on a street and threatened to cause him to lose his
employment for accusing his wife of theft. Upon being challenged to carry out
the threat S collared M, cuffed him and, alleging that M had insulted and
molested a woman who was passing by, called upon J and C to arrest him. M.
was taken to a police station where he was detained for a short while before
being released, without being charged, on the directions of an NCO of police.
In an action for damages for assault, wrongful arrest and false imprisonment
against S, J and C.
Held: (i) compensatory damages against joint tortfeasors should not be
assessed according to the act of the most guilty or the most innocent, but must
relate to the aggregate of the plaintiff's injury.
(ii) exemplary damages should never be awarded against a defendant whose
conduct has not been such as to call for punishment or deterrence merely
because a co-defendant has been found to be within one of the categories of
persons who should be punished or deterred.

Valentine v. Rampersad 17 WIR 12 Fraser JA (COA TT)

Landlord and Tenant Landlord committing acts of harassment against tenant

Premises made unsuitable for occupation Tenant removes voluntarily
Action for damages.

Damages Judge awarded aggravated damages Declined to award

exemplary damages Appeal against award of damages Rookes v Barnard
considered Circumstances justifying award of exemplary damages Letting
of Houses (Implied Terms) Ordinance, Cap 27, No 8 [T], s 3 (2); Rent Act 1965
[UK], s 30.

In 1959 R purchased dwelling premises occupied for nine years by V, who paid
a monthly rent of $6: for three rooms of a four-roomed building in which one of
the rooms was unoccupied when R purchased. V had the use also of a
kitchen, a bathroom, and a latrine. Shortly after the purchase V offered to pay
rent to R, who refused it and told her that he intended to demolish the
premises, so she could keep the money and seek other accommodation. V
sent the rent by registered post and R terminated the tenancy by a notice in
March. Rs workman on his instructions entered the premises without Vs
knowledge or consent and cut down a tree which fell and demolished the

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latrine. It was never adequately replaced. R later dumped 100 loads of gravel
which formed a high mound on the premises and he instructed his workman,
unknown to V, to carry out certain works including the removal of galvanised
sheets from the roof of the unoccupied room. All this occurred late in October
1959. On 22 October the second unsuccessful ejectment proceedings by R
against V were dismissed. The action was filed on 19 November 1959. R
obtained an order for possession in March 1960, and V removed voluntarily in
May 1960.

The trial judge regarded the action as a proper case in which an element of
aggravation should be taken into account in assessing compensatory
damages, but declined to award exemplary damages because, as he said, he
was not persuaded to the view that the respondents conduct was either so
high-handed or ruthless to warrant punishment.

On appeal,

Held: (1) that on the facts found by the trial judge the circumstances disclosed
a clear case of harassment and ruthless disregard by the landlord of the rights
of the tenant.

(ii) that the dictum of LORD DEVLIN in Rookes v Barnard ((1964), AC 1129; (1964),
2 WLR 269; 108 Sol Jo 93; (1964), 1 All ER 367; 1964 1 Lloyds Rep 28 (HL); 108 Sol
Jo 451; 27 MLR 257; 1964 JBL 199) does not exclude the possibility of oppressive
action by private corporations or individuals being visited by an award of
exemplary damages.

(iii) that the respondents conduct was oppressive in a real sense and
warranted punishment by exemplary damages.

Appeal allowed. An additional sum of $500 awarded as exemplary damages.

Douglas v. Bowen 22 WIR 333 JA

The categories to which exemplary damages might be awarded as set out in

Rookes v. Barnard should be adopted in Jamaica. The respondent Marjorie
Bowen was unlawfully evicted by the appellant Brinkman Douglas from a
building. At the time of her eviction she was in occupation of those premises as
a monthly tenant under an oral agreement entered into by her as tenant and
the appellant as landlord on 17 July 1967. As a result of the manner of her
eviction she suffered the loss of or damage to a number of her personal
belongings and articles used in connection with her business as well as loss of
business. The appellant did not seek to deny liability. The appellant seeks to
have the award of compensatory damages reduced as being much too great.
He seeks to have the award of exemplary damages set aside on the ground
that this is not a case for the award of exemplary damages

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HELD: It appears to be common ground that in Jamaica the award of
damages as a remedy in all civil wrongs is as in England the creature of the
common law. Jamaica being regarded as a settled colony would have
inherited the English common law in this regard. However, as LORD DIPLOCK
observed in Cassell & Co, Ltd v Broome
'Despite the unifying effect of that inheritance on the concept of man's
legal duty to his neighbour, it does not follow that the development of
the social norms in each of the inheritor countries has been identical or
will become so.'
It may be observed that in Trinidad and Tobago LORD DEVLIN's categorisation
has been accepted and applied without any detailed or critical analysis by
that country's Court of Appeal in Marshall v Semper (a case of assault, wrongful
arrest and false imprisonment) and Valentine v Rampersad (a case of
harassment of a tenant).
It is important to observe that LORD DEVLIN's first premise is that the object of
damages in the usual sense of the term is to compensate. Next LORD DEVLIN said
that as far as he knew the idea of exemplary damages is peculiar to English
law. Consequently, he argued, such an award is an anomaly in the law of
England. So LORD DEVLIN suggested that in future a clear distinction ought to be
made between compensatory (or aggravate) and punitive (or exemplary)
damages the former reflecting what the plaintiff has suffered materially or in
wounded feelings, the latter the jury's (or judge's) view of the defendant's
motive and conduct where they aggravate the injury done to the plaintiff.
Then LORD DEVLIN stated two categories of cases to which he added another
category in which exemplary damages are authorised by statute. The first of
these categories he said is oppressive, arbitrary or unconstitutional action by
servants of the government. He excluded from this category inter alia
individuals. In Cassell & Co, Ltd v Broome it was held that this category should
not be limited to servants of government in the strict sense of the word but
should be extended to others, such as local government officials and the
police.
Cases in the second of these categories are those in which the defendant's
conduct has been calculated to make a profit for himself which may well
exceed the compensation payable to the plaintiff This category is not
confined to moneymaking in the strict sense but extends to cases in which the
defendant is seeking to gain at the expense of the plaintiff some object
perhaps some property which he covets, which either he could not obtain at
all or not obtain except at a price greater than he wants to put down.
This category is, as LORD DIPLOCK has stated in Cassell & Co, Ltd v Broome, of
cases where an act known to be tortious was committed in the belief that the
material advantages to be gained by doing so would out-weigh any
compensatory damages which the defendant would be likely to have to pay
to the plaintiff. In respect to what he designated as the third category LORD
DIPLOCK said:
'I see no reason for restoring to English law the anomaly of rewarding
exemplary damages in the third category of cases. If malice with which
a wrongful act is done or insolence or arrogance with which it is
accompanied renders it more distressing to the plaintiff, his injured

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 feelings can still be soothed by aggravated damages which are
compensatory there is little doubt that the overruled case of Louden v
Ryder stands alone as one in which exemplary damages were awarded
against a private bully or oppressor. There can be no question of there
being any settled practice to award exemplary damages in a case of
that kind.
The instant case being one of a private bully would therefore be excluded from
the first category. The trial judge's finding that the appellant appeared to want
the respondent out of the house for no particular reason, and this finding is
supported by the evidence, would in my view mean that the respondent has
failed to show in the words of LORD DIPLOCK that the appellant did direct his
mind to the material advantages to be gained by committing the tort and
came to the conclusion that they were worth the risk of having to compensate
the plaintiff (respondent) if she did bring an action.

Beckles v. Chandler

The plaintiff became the owner of a parcel of land by a conveyance from the
court. At the time of purchase the defendants were in possession but were
subsequently ejected by warrant of the court. After being ejected the
defendants again entered on the land and took possession and were again
ejected by warrant of the court. The defendants trespassed again and
depastured stock on the land for which damages were recovered by the
plaintiff. Subsequently the defendants started to demolish a building on the
land and on two occasions erected a chattel house thereon. The defendants
further threatened to continue their trespass.
Held: (i) the actions of the defendants went beyond simple trespass for which
the award of damages would not be an adequate remedy, and a perpetual
injunction restraining the defendants from trespassing should be granted;
(ii) the erection of the chattel house constituted a nuisance for which a
mandatory injunction should issue against the male defendant, the owner of
the house, ordering him to remove it; and that the damages should include a
sum as exemplary damages for the wilful persistence of the defendants in
continuing the trespass. In fixing the damages the court took into account the
fact that the plaintiff suffered the defendants to be on the land from 1950 to
1954 before bringing the action.

Kuddus v. Chief Constable of Leicestershire Constabulary

Whether exemplary damages could be awarded on the ground of oppressive,

arbitrary or unconstitutional action by a public officer depended on the
features of the officer's behaviour rather than on the precise cause of action
sued on and the fact that misfeasance in public office was not a cause of
action that had been accepted before 1964 as justifying an award of
exemplary damages did not preclude the plaintiff's claim.

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 Damages Agreed by Contract

Dunlop Pneumatic Tyre Co Ltd v. New Garage & Motor Co Ltd [1915] AC 79
This case laid down several principles that are relevant in deciding whether in
addition laid down several principles that are relevant in deciding whether a
sum is liquidated damages or a penalty:
(i) The parties use of the words penalty or liquidated damages does
not conclusively decide the issue;
(ii) One must judge the issue according to the circumstances at the time
the contract was made and not at the time of the breach;
(iii) The sum will be held to be a penalty if it is extravagant and
unconscionable in amount in comparison with the greatest loss that
could conceivably be proved to have followed from the breach.
(iv) It will be held to be a penalty if the breach consists only in not
paying a sum of money, and the sum stipulated is a sum greater than
the sum which ought to have been paid.
(v) There is a presumption (but no more) that it is a penalty when a
single lump sum is made payable by way of compensation, on the
occurrence of one or more or all of several events, some of which
may occasion serious and others but trifling damage.
(vi) It is no obstacle to the sum stipulated being a genuine pre-estimate
of damage that the consequences of the breach are such as to
make precise pre-estimation almost an impossibility. On the contrary,
that is just the situation when it is probable that the pre-estimate
damage was the true bargain b/w the parties.

Bridge v. Campbell Discount Co Ltd [1961] 2 All ER 97

There was a minimum payment clause in the hire purchase agreement

whereby if the debtor was in breach of contract (or chose to terminate lawfully
the contract) he should return the goods to the creditor and make up the
payments already paid to two-thirds of the hire purchase price. This sum was
expressed to be compensation for depreciation. The debtor, having made
several payments, refused to pay any more and returned the car. The HL
having held that he was in breach of contract, decided that the sum payable
under the minimum payment clause was penal and irrecoverable b/c it did not
represent a genuine pre-estimate of loss. In particular, the amount stated
could not be regarded as compensation for depreciation b/c, in Lord
Radcliffes words, the clause:

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 produces the result, absurd in its own terms, that the estimated
amount of depreciation becomes progressively less the longer the
vehicle is used under the hire. This is b/c the sum agreed upon
diminishes as the total of cash payments increases. It is a sliding scale of
compensation but a scale that slides in the wrong direction

What is doubtful is whether equity will intervene and give relief otherwise than
by extending the time allowed for payment.

Clydebank Engineering and Shipbuilding Co., Ltd and Others v Don Jose Ramos
1905

ContractPenalty or Liquidated DamagesTime LimitWaiver.

The Spanish Government contracted with the appellants for the building of
four torpedo boats, delivery to be within periods varying from six and a half
months to seven and three-quarter months from the date of the contracts. The
contracts provided that The penalty for later delivery shall be at the rate of
500l. per week for each vessel. The vessels having been delivered many
months after the stipulated period and the price paid, the Spanish Government
claimed from the appellants payment of 500l. for each week of late delivery:

affirming the decision of the Second Division of the Court of Session,(1.)that the
sum of 500l. a week was to be regarded as liquidated damages and not as a
penalty, and that the Spanish Government were entitled to recover;(2.)that
payment in full of the price of the vessels without reservation was no waiver of
the claim for damages for delay in delivery.

Stockloser v. Johnson [1954] 1 QB 476

COA agreed that intervention was not warranted, but its members differed as
to the principle upon which such relief might be granted. Romer LJ concluded
that in the absence of some special circumstances such as fraud, sharp
practice or other unconscionable conduct of the vendor no intervention by
the court is permissible after the contract has been rescinded, except to allow
an extension of time for payment. Sommervell and Denning LJJ thought that
the province of equity was not so circumscribed and that it may permit more
general relief whenever the forfeiture clause is of a penal nature where, that
is, the sum forfeited is wholly disproportionate to the damage suffered
provided that in the circumstances it is unconscionable for the money to be
retained.
- Galbraith v. Mitchenall Estates Ltd favours Romer LJ
- Starside Properties v. Mustapha favours Sommervell and Denning LJJ

Galbraith v. Mitchenhall Estates Ltd [1965] 2 QB 473

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By a contract for the hire of a caravan the hirer was to make an initial payment
of 550 10s, followed by sixty rentals of 12 10s. The retail price of the caravan
was 1,050. The contract of hire was a long document in small print. The hirer
signed it without reading it. When he signed the contract the hirer assumed
that it was a contract of hire-purchase, but there was no sharp practice or
unconscionable conduct on the part of the finance company, with which the
contract was made, in obtaining the agreement. The hirer paid the initial
payment, and had delivery of the caravan. After he had lived in it with his
family for some four months, the owners (the finance company) re-possessed
the caravan under the terms of the contract, the hirer having failed to pay
rentals. At the date of re-possession the caravan was worth 800. The position
created by the contract was that the owners could both retain the initial
payment and have re-possession of the caravan. The caravan was sold
subsequently by the owners for 775, having been somewhat damaged by the
re-possession agents. The contract also entitled the owners to enforce payment
of a proportion of the outstanding rentals, but they took no action under these
provisions. In an action by the hirer for recovery of the initial payment,
Held Although the contractual position enabling the owners to retain both the
initial payment and the caravan was one of undue harshness yet there was no
equity to re-model a contract freely negotiated and entered into without either
fraudulent or unconscionable conduct by the other party thereto; accordingly,
the 550 10s being money paid under the contract that the owners were
entitled to retain, the court would not intervene, and the action must be
dismissed

Steedman v. Drinkle [1916] AC 275

By an agreement in writing dated 9 December 1909, land in the province of S

was sold for 16,000 dollars, of which 1,000 dollars were paid on signing the
agreement and the balance was payable by six annual instalments on 1
December of each year. The agreement provided that, if the purchaser should
make default in any of the payments, the vendor should be at liberty to cancel
the agreement and to retain, as liquidated damages, the payments already
made, and that time was to be considered as of the essence of the
agreement. Default having been made in the payment of the first instalment,
the vendor cancelled the agreement; assignees of the purchaser sued for
specific performance:
Held the parties having made time of the essence of the agreement, specific
performance could not be decreed; but the forfeiture of the money paid was
a penalty from which relief should be granted on proper terms.

Kelmer v. British Columbia Orchard [1913] AC 319

An agreement for sale by respondent company of lands in British Columbia for

a price to be paid in instalments at specified dates contained a clause of
forfeiture both of the agreement and of all payments of past instalments of

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purchase-money in case of default of punctual payment of any one
instalment; and time was declared to be of the essence of the agreement.
Default having been made, the company sued to enforce the forfeiture;
appellant paid into court the instalment due and counterclaimed for specific
performance:
Held by the law of British Columbia as well as by English law the condition of
forfeiture was in the nature of a penalty from which appellant was entitled to
be relieved on payment of the purchase-money due.

Workers Trust and Merchant Bank Ltd v. Dojap Investments Ltd [1993] AC 573

The PC decided that a clause allowing the forfeiture of money paid could be
and, on the facts would be struck down as a penalty; and in this context, given
that deposits are generally not concerned to pre-estimate loss, the test applied
to decide whether the sum to be forfeited was penal or not was one of
reasonableness.

Export Credit Guarantee Department v. Universal Oil [1983] 2 All ER 205

The HL held that the penalty rules only apply where the money is payable on
an event which is a breach of contract as b/w the plaintiff and the defendant.
(This case is puzzling since it appears that the sum agreed to be paid, though
very large, was exactly the same as the plaintiffs loss and therefore not penal).

Starside Properties v. Mustapha [1974] 2 All ER 567

The court had jurisdiction to grant relief against forfeiture when the provision for
forfeiture was penal in character. Relief would be granted in such
circumstances as justice required and on such terms as were equitable in those
circumstances. Where it later appeared that relief granted by way of an
extension of time ought to be extended, and that in fairness to the other party it
could be done, the court had jurisdiction to grant a further extension. No
distinction could be drawn between cases of relief for non-payment of rent
and other cases where relief against forfeiture was sought. It followed that the
judge had jurisdiction to grant the relief asked for by the defendant.

Phillips Hong Kong Ltd v. AG of Hong Kong (1993) 61 BLR 41

Lord Woolf giving the judgement of the PC upholding as liquidated damages a

clause in a road construction contract, considered that the courts should not
be too zealous in knocking down clauses as penal. What the parties have
agreed should normally be upheld. More specifically it was stressed that a
clause can be a genuine pre-estimate of loss even though hypothetical
situations could be presented in which the claimants actual loss would be

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substantially lower. To hold otherwise would be to render it very difficult to draw
up valid liquidated damages clauses in complex commercial contracts.
Although the matter must be judged as at the date the contract was made,
what actually happened can provide valuable evidence as to what could
reasonably be expected to be the loss at the time the contract was made.

Jobson v Johnson [1989] 1 W.L.R 1026

Where a clause in a contract of sale of shares provides for the retransfer of

these shares at a fixed price below the actual value if the purchaser defaulted
on payment, the clause was a penalty clause which could be sued upon but
would not be enforced without giving the purchaser an opportunity to obtain
relief. The plaintiff owned 44.914 per cent of the issued share capital of a
football club. The plaintiff contracted to sell the shares to the defendant by a
sale to the defendant's nominee for GBP 40,000 and by a side-letter the
defendant agreed to pay an additional GBP 311,698 by instalments. In the
event of default in payment of the instalments, the side-letter provided for the
retransfer of not less than 44.9 per cent of the issued share capital to the
plaintiff for GBP 40,000. The defendant defaulted in paying the instalments and
the plaintiff sought to enforce the provision for retransfer. The defendant
argued that the clause was a penalty and counterclaimed for relief from
"forfeiture of the shares". The judge held that the retransfer clause was a
penalty but was enforceable although there was a discretion to grant the
defendant relief under his counterclaim. The counterclaim was subsequently
struck out for failure to comply with undertakings. The defendant appealed on
the basis that the retransfer clause was unenforceable being a penalty clause.

Held, that the clause was a penalty clause, punishing the defendant for default
in payment of the instalments by a retransfer of the shares at a fixed price that
was less than the defendant had paid and a sum that was not a genuine pre-
estimate of the vendor's loss. Such a clause was not struck out. It could be sued
upon but would not be enforced without giving the defendant the opportunity
of relief. As there was no counterclaim, the court could not grant relief by way
of an extension of time to pay the instalments due. There could be an order for
specific performance if the shares' value did not exceed the plaintiff's loss. If so,
the sale of the shares would realise a sum sufficient to put the plaintiff in the
position he would have been in if there had been no default. (An alternative
remedy would be for an order for specific performance on terms that the
plaintiff repaid the defendant the sum received under the agreement).

Cocoa Industry Board and Cocoa Farmers Dev. Co. Ltd. and Shaw v Melbourne
30 J.L.R. 242

The plaintiff/respondent was employed by the defendants/appellants as a

book-keeper. His contract of employment stated, inter alia, that his services
were terminable on one month's notice or one month's salary in lieu of notice.

Page 95 of 169
In addition, the company's manual stated that termination could be effected
immediately by mutual consent, by reasonable notice on either side or
summarily for adequate cause. The plaintiff's/respondent's contract of service
was terminated on the basis that his performance was below expectation and
that he betrayed the confidence his employers had placed in him. He was
paid one month's salary in lieu of notice. The plaintiff brought an action for
wrongful dismissal. Judgment was granted in his favour and the trial judge
awarded $7,200 representing a month's salary less statutory deductions as
special damages and exemplary damages of $20,000. The defendants
appealed. On appeal, it was contended by the respondent that the
appellants purported to terminate the contract for cause, not having
established cause the dismissal was unlawful and the one month's pay in lieu of
notice could not avail the appellants.

Held: (i) the contract of employment made it clear that the appellants could
terminate the agreement on the giving of one month's notice or one month's
salary in lieu of notice. This is what the appellant did and therefore, there is no
basis on which a claim for wrongful dismissal can be upheld;
(ii) the statements of the appellants on the respondent's behaviour in the letter
of dismissal is of no importance as the respondent was not dismissal summarily,
but was given a month's salary in lieu of notice;
(iii) where it is an express term of a contract that an employee who is dismissed
without notice is to be paid his wages for a certain period in lieu of notice or
where there is usage to that effect, the measure of damages for breach is the
amount of such wages. The trial judge's award in the instant case of nine
months net salary as special damages was arbitrary as there was no evidence
to establish that the period of a nine months would have been the time it would
take a person in the respondent's position to obtain employment. In any event,
this type of award is only properly made where the contract is for a fixed period
and is terminated before the set date;
(iv) it is settled law that exemplary damages may only be awarded in an
action in tort and then only in a limited category of cases; the award for
exemplary damages in the instant case was wrong in law. Neither exemplary or
aggravated damages could be awarded.
Appeal allowed, judgment of the court below set aside, judgment entered for
appellants with costs here and below to the appellants to be taxed, if not
agreed.

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AWARDING OF DAMAGES IN FOREIGN CURRENCY

Where a foreign element appears in a case, bringing with it questions involving

payments in a foreign currency, the problems to which changes in the value of
money gives rise become both more acute and more common b/c of the
frequent large fluctuations in the rates of exchange, together with wholesale
devaluations of one currency in relation to another.
The general rule for a while was that the damages fell to be assessed in
[sterling] according to the rate of exchange at the date of breach in the case
of contract, and in the case of tort at the date that the loss was determined.
If the action was based solely upon the failure to pay money, so that, had the
defendant contracted to pay the money in sterling, the action would be in
debt and no longer for damages, the general rule applied.

United Railways of Havana v. Regla Warehouses

Page 97 of 169
A railway company in 1921 in raising money in the USA to finance the
acquisition of rolling stock for its railway in Cuba, entered into an elaborate
scheme whereby it assigned the rolling stocks to trustees for the lenders who
leased it back to the company, the rentals being payable in dollars and being
fixed so as to cover repayment of the loan with interest over the 15 years of the
lease, after which time the company would become owner of the rolling stock.
From 1931 the company ceased to pay the dollar rentals to the trustees, but it
was not until 1954 that the matter came before the English courts when the
trustees sought to prove in the companys voluntary liquidation following upon
the acquisition of the railway by the Cuban Government.
HL held that the provable sum in dollar rentals was to be converted into sterling
rates of exchange prevailing at the dates when the several sums fell due and
were not paid.

Miliangos v. George Frank (Textiles) Ltd

The HL disposed the assumption that an English court had always to confine
itself in its judgments to sterling and could never give judgment in a foreign
currency.
The P, a Swiss national, sold goods to the Ds, an English company, at a price
expressed to be payable in Swiss Francs to a Swiss Bank within 30 days of the
date of invoice, the proper law of the contract being Swiss. The goods and
invoices were delivered, but no part of the price was paid and two bills of
exchange drawn in Switzerland and accepted by the Ds were dishonoured on
presentation. The P brought a claim for the price or, alternatively, for the
amount due on the bills of exchange expressed, in each case, in the sterling
equivalent of the sum due in Swiss francs as at the dates when payment should
have been made, but later applied to amend his statement of claim so as to
claim the sums due to him in Swiss francs.
Lord Wilberforce said: The situation as regards currency stability has
substantially changed even since 1961the main world currenciesmany of
them are now floating i.e. they have no fixed exchange value even from day
to day
The new formula which was adopted was, to depart from the former
adherence to the breach date by awarding delivery in specie rather than
by giving damages. The relevant date is the date of payment in the sense of
the date when the court authorises the P to enforce the judgement by levying
execution for a sum expressed in sterling.

CAUSATION AND REMOTENESS

Causation in Contract

London & Joint Stock Bank v McMillan [1918] A.C. 777

A customer of a bank owes a duty to the bank in drawing a cheque to take
reasonable and ordinary precautions against forgery, and if as the natural and
direct result of the neglect of those precautions the amount of the cheque is

Page 98 of 169
increased by forgery, the customer must bear the loss as between himself and
the banker.

A firm, who were customers of a bank, entrusted to a confidential clerk, whose

integrity they had no reason to suspect, the duty of filling in their cheques for
signature. The clerk presented to one of the partners of the firm for signature a
cheque drawn in favour of the firm or bearer. There was no sum in words written
on the cheque in the space provided for the writing and there were the figure
2.0.0 in the space intended for figures. The partner signed the cheque. The
clerk subsequently added the words one hundred and twenty pounds in the
space left for words and wrote the figures 1 and 0 respectively on each
side of the figure 2, which was so placed as to leave room for the
interpolation of the added figures. The clerk presented the cheque for
payment at the firm's bank and obtained payment of 120l. out of the firm's
account:

that the firm had been guilty of a breach of the special duty arising from the
relation of banker and customer to take care in the mode of drawing the
cheque; that the alteration in the amount of the cheque was the direct result
of that breach of duty; and that the bank were therefore entitled to debit the
firm's account with the full amount of the cheque.Young v. Grote (1827) 4 Bing.
253 approved.Scholfield v. Earl of Londesborough [1896] A. C. 514
distinguished.Colonial Bank of Australasia v. Marshall [1906] A. C. 559
considered.Decision of the Court of Appeal [1917] 2 K. B. 439 reversed.Per Lord
Shaw of Dunfermline: In the case of a customer's cheque, admittedly genuine,
no responsibility rests upon the banker for what has happened to the cheque
before its presentation to the bank, but the responsibility for what has
happened to it between the dates of signature and presentation rests upon the
customer.

Weld-Blundel v Stephens [1920] A.C. 956

The appellant employed the respondent, a chartered accountant, to
investigate the financial position of a company in which he was financially
interested. In a letter of instructions to the respondent, the appellant referred to
a former manager and an auditor of the company in defamatory terms. The
respondent handed the letter to his partner to carry out the investigation
requested by the appellant, and the partner negligently left it at the company's
office. The manager of the company found it, read it, and communicated its
contents to the two persons defamed, who sued the appellant for libel and
recovered damages against him on the ground that, while the occasion on
which the letter was written was privileged, he had been actuated by malice.
The appellant then sued the respondent for breach of duty in failing to use
reasonable care to keep the contents of the letter secret, claiming as special
damages the damages and costs which he had had to pay in the libel actions.

Held (by LORD DUNEDIN, LORD SUMNER and LORD WRENBURY, VISCOUNT
FINLAY and LORD PARMOOR dissentiente): the appellant could not recover

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more than nominal damages because (i) the wrongful act for which he had
had to make reparation was committed by himself independently of the
breach by the respondent of the duty of care which he owed to the appellant;
(ii) the actions for libel and the damages recovered from the appellant were
not the natural and probable consequence of the respondent's negligence,
but resulted from the voluntary act of the manager of the company, a free
agent over whom the respondent had no control and for whose acts he was
not responsible.

Heskell v Continental Express Ltd

In October, 1946, H, an export and shipping merchant, agreed to sell goods to
a Persian buyer. The price agreed on was not inclusive of insurance and freight,
and the total amount shown on the invoice, which was ultimately rendered, set
out the cost of packing, insurance and freight separately. On 8 November
1946, H, without entering into a contract of carriage, registered cargo space for
them through his forwarding agents in a ship in a dock in Manchester port and
received a permit from the shipowners loading brokers, S Ltd, to send the
goods to the dock. On 19 November 1946, having received shipping
instructions from his forwarding agents, H instructed C E Ltd, the company
warehousing the goods, to pack them and despatch them to the ship. C E Ltd
negligently failed to despatch them or to inform H of their failure. In ignorance
of this failure, H applied through his forwarding agents for, and received from S
Ltd, a bill of lading which was negligently issued, the goods never having been
received. On 2 January 1947, H forwarded it to the Persian buyer, and received
payment. On 23 February 1948, C E Ltd, wrote to H notifying their failure to
despatch the goods, and in November, 1949, H paid 1,319 damages to the
Persian buyer, covering loss of profit resulting from non-delivery. The fall in value
of the goods from December, 1946, to February, 1948, the date of their ultimate
delivery to H, with other small amounts, was 175. H claimed damages from S
Ltd and C E Ltd

Held (i) whether or not the contract with the Persian buyer could properly be
called cif, it was an essential term thereof that H should procure the shipment of
the goods to Teheran.
(ii) H could not recover from S Ltd (a) for breach of a contractual duty
because neither in issuing the bill of lading nor in notifying the reservation of
shipping space were S Ltd acting or offering to act in contractual relationship
with H so as to give rise to any particular duty owing to him; (b) for breach of
any duty owed to the public because the issue of the bill of lading seemed to
amount to no more than a negligent misstatement, and, in any event, such
issue was not itself the subject of any general duty (Le Lievre v Gould ([1893] 1
QB 491) and Scholfield v Londesborough (Earl) ([1896] AC 514), applied); (c) for
breach of warranty of authority because in the absence of a contract of
carriage the bill of lading was a nullity, and the fact that it was issued without
the authority of the shipowners robbed it of no virtue.
(iii) the instructions to C E Ltd to despatch the goods were not a demand for
delivery up of the goods, and, therefore,a claim in detinue against C E Ltd
could not be maintained.

Page 100 of 169

 (iv) the detention of the goods by C E Ltd and their failure to inform H of the
whereabouts of the goods was a continuing breach of duty by C E Ltd, and
while it was true that the issue of the bill of lading was a cause contributing
equally to Hs loss up to the time of the final delivery to him, the breach of
contract by C E Ltd was sufficient to carry judgment for damages in respect of
the loss in that period.
Ranson v Platt ([1911] 2 KB 291), Coldman v Hill ([1919] 1 KB 443) and Reischer
v Borwick ([1894] 2 QB 548), applied.
Yorkshire Dale S S Co Ltd v Minister of War Transport ([1942] 2 All ER 6),
considered.
(v) although a carrier should recognise the serious possibility of sub-sales by a
consignor or consignee, in order to recover from C E Ltd more than the value of
the goods at the place of delivery, H must show that C E Ltd had knowledge,
actual or imputed, of something that made the ordinary measure of damages
inadequate, and, as H had not shown such knowledge, it was unnecessary to
consider whether the fact that the claim for additional damages was in respect
of damages paid to a sub-buyer and not loss of profit would affect the question
of the liability of C E Ltd.
The Arpad ([1934] P 189) and Horne v Midland Railway Co (1873) (L R 8 C P
131), applied.

Remoteness in Contract

Hadley v Baxley
Where two parties have made a contract which one of them has broken the
damages which the other party ought to receive in respect of such breach of
contract should be such as may fairly and reasonably be considered as either
arising naturally, ie, according to the usual course of things, from such breach
of contract itself, or such as may reasonably be supposed to have been in the
contemplation of both parties at the time they made the contract as the
probable result of the breach of it. If special circumstances under which the
contract was made were communicated by the plaintiff to the defendant, and
thus known to both parties, the damages resulting from the breach of such a
contract which they would reasonably contemplate would be the amount of
injury which would ordinarily follow from a breach of contract under the special
circumstances so known and communicated. But if the special circumstances
were wholly unknown to the party breaking the contract, he, at the most, could
only be supposed to have had in his contemplation the amount of injury which
would arise generally, and in the great multitude of cases not affected by any
special circumstances, from such a breach of contract.

Victoria Laundry (Windsor)v Newman Industries

The defendants, an engineering company, agreed to sell a boiler to the
plaintiffs, a company of launderers and dyers. The defendants knew at the time
of the contract of the type of business carried on by the plaintiffs, that the boiler

Page 101 of 169

was required for that business, and that the plaintiffs wanted the boiler for
immediate use. They did not know that it was required to extend the business.
The boiler was damaged while being dismantled by the third party, sub-
contractors employed by the defendants to load it on the plaintiffs transport
vehicle, and delay in delivery resulted:

Held (i) damages for loss of profit were recoverable if it was apparent to the
defendants as reasonable persons that the delay in delivery was liable to lead
to such loss by the plaintiffs, and it was not necessary for the defendants to be
specifically informed of the particular purpose for which the boiler was
required; on the facts, the defendants had means of knowledge that some loss
was likely to result; and they were, therefore, liable to the plaintiffs.

Held Further: the fact that the boiler only constituted a part of a profit-making
machine was only significant in so far as it bore on the capacity of the
defendants to foresee the consequences of non-delivery.

Diamond v Campbell-Jones and Others

In July, 1956, the defendants agreed to sell to the plaintiff for 6,000 a leasehold
interest for a term expiring in the year 2003 in property in Mayfair comprising a
basement and ground floor and four upper floors. The agreement was
expressed to be subject to and with the benefit of a contract for the grant of a
new lease, which contract required works of conversion of the property into
ground floor office accommodation and residential maisonettes above to be
carried out by the lessee. The agreement also stated that the permitted use for
the purposes of the Town and Country Planning Act, 1947, was that stated in a
letter by which permission was given for office use of the ground floor until a
date in 1970 and from which it appeared that permission for multiple residential
use of the rest of the premises would probably be given if requested. The
defendants repudiated the contract and an inquiry as to damages was
ordered. The plaintiff contended that the proper measure of damages was the
profit that he would have realised if he had converted the upper floors into
maisonettes and the ground floor into offices, and if he had disposed of the
premises when so converted. The plaintiff was a dealer in real property, but it
was neither pleaded nor shown in evidence that the defendants knew what his
occupation was or that he intended to carry out a conversion of the premises.
The market value of the property at the date of the breach of contract, without
having been converted, substantially exceeded 6,000.

Held (i) the plaintiff was not entitled to damages measured by reference to
the profit obtainable by converting the property, because special
circumstances were necessary to justify imputing to a vendor of land
knowledge that the purchaser intended to use it in a particular manner, and
the mere facts that the property was ripe for conversion and that everyone
recognised this were not sufficient to impute to the defendants knowledge that

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the plaintiff intended to convert the property for profit; therefore, the damages
should be assessed by reference to the difference between the purchase price
and the market value at the date of the breach of contract.
Dictum of Lord Wright in Monarch SS Co Ltd v Karlshamns Oljefabriker (AB)
([1949] 1 All ER at p 14) considered.
Dictum of the Court of Appeal in Victoria Laundry (Windsor) Ltd v Newman
Industries ([1949] 1 All ER at p 1003) explained.
(ii) since the damages recovered by the plaintiff were liable to attract income
tax as part of the profits or gains of his business, he should be awarded a gross
sum in damages (equal to the excess of the market value 583 over the
purchase price at the relevant date), not merely a net sum equivalent to the
profit remaining after deduction of income tax.

Causation in Tort

Knightly v Johns

The first defendant was involved in a serious road accident near the exit of a
tunnel carrying one-way traffic and which had a sharp bend in the middle thus
obscuring the exit and the site of the defendants accident to drivers entering
the tunnel. The police inspector in charge at the scene of the accident,
realising that he had forgotten to close the tunnel to oncoming traffic, ordered
two police officers on motor cycles, one of whom was the plaintiff, to go back
and close the tunnel. The two officers then rode back through the tunnel
against the oncoming traffic. Near the entrance of the tunnel the plaintiff
collided with an oncoming motorist and was injured. The motorist was found on
the facts not to have been negligent. Both the inspector in ordering the plaintiff
to ride back through the tunnel in the face of oncoming traffic and the plaintiff
in carrying out that order acted contrary to, and in breach of, their police
forces standing orders for road accidents in the tunnel. The plaintiff claimed
damages from, inter alios, the first defendant, the police inspector and the
chief constable as being vicariously liable for the inspectors negligence. The
first defendant conceded that he had been negligent but claimed that the
negligence of the other defendants and/or of the plaintiff had caused or
contributed to the accident. The trial judge found that neither the plaintiff nor
the police inspector had been negligent and that their actions had not broken
the chain of causation between the first defendants accident and the
plaintiffs accident. The trial judge accordingly found the first defendant wholly
liable for the plaintiffs injuries. The first defendant appealed. At the hearing of
the appeal it was found that, although the plaintiff had added to the danger
involved in riding against the oncoming traffic in the way he did, he had not
been negligent and was not responsible for his own injuries. On the issue of
whether the inspector had been negligent and whether his negligence
constituted a novus actus interveniens,

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Held (1) The inspector was negligent in not closing the tunnel before he gave
orders for that to be done and also in ordering or allowing his subordinates,
including the plaintiff, to carry out the dangerous manoeuvre of riding back
along the tunnel contrary to the standing orders for road accidents in the
tunnel (see p 857 j to p 858 b and p 866h j, post).
(2) In considering whether the chain of causation between a tort and
subsequent damage had been broken by a novus actus interveniens, the test
to be applied was whether the damage was natural and probable and
therefore reasonably foreseeable, in the sense that something similar to what
happened was likely to happen, rather than what happened being a mere
possibility which would not occur to the mind of a reasonable man or, if it did,
would be discounted by him as being too remote to require precautions
against it happening. Thus, if the whole sequence of events was a natural and
probable consequence of the negligence and therefore a reasonably
foreseeable result of it, none of the events in the sequence were to be taken as
being a novus actus interveniens. Furthermore, what was to be considered
probable and foreseeable, 851 including mistakes and mischances
occurring in the sequence of events, was to be decided by applying common
sense rather than logic to the facts and circumstances of each case (see p 860
j, p 864 a, p 865 e to j and p 866 c and h j, post); dicta of Greer LJ in Haynes v
Harwood [1934] All ER Rep at 107 and of Lord Wright in The Oropesa [1943] 1 All
ER at 215 applied; Brandon v Osborne Garrett & Co [1924] All ER Rep 703, Hyett
v Great Western Rly Co [1947] 2 All ER 264, Ward v TE Hopkins & Son Ltd [1959] 3
All ER 225, Overseas Tankship (UK) Ltd v Morts Dock and Engineering Co Ltd, The
Wagon Mound (No 1) [1961] 1 All ER 404, Videan v British Transport Commission
[1963] 2 All ER 860, Chadwick v British Transport Commission [1967] 2 All ER 945
and Home Office v Dorset Yacht Co Ltd [1970] 2 All ER 294 considered.
(3) Applying the test of what was probable and foreseeable to the facts, the
inspectors negligence in not closing the tunnel to traffic and in ordering the
plaintiff to remedy that negligence by a dangerous manoeuvre had been the
real cause of the plaintiffs injuries and was a new cause which disturbed and
interrupted the sequence of events between the first defendants accident
and the plaintiffs accident. The inspectors negligence therefore made the
plaintiffs injuries too remote from the first defendants wrongdoing to be a
consequence of it. The inspector and the chief constable were therefore liable
to the plaintiff and the first defendant was not. The appeal would accordingly
be allowed (see p 858 c d and p 866 a to j, post).
Per curiam. In deciding whether the whole sequence of events which
emanated from a negligent act was a natural and probable consequence
and a reasonably foreseeable result or whether an event or events in the
sequence was or were a novus actus interveniens, it is helpful, but not decisive,
to consider which events were deliberate choices to do positive acts, which
events were omissions or failures to act, which acts and omissions were
innocent mistakes or miscalculations and which acts and omissions were
negligent, since negligent conduct is more likely to break the chain of
causation than conduct which is not, positive acts will more easily constitute

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new causes than inaction, and mistakes and mischances are to be expected
of human beings in a crisis (see p 865 g h and p 866 h j, post).

Home Office v Dorset Yatcht Co. Ltd

Ten borstal trainees were working on an island in a harbour in the custody and
under the control of three officers. During the night seven of them escaped. It
was claimed that at the time of the escape the officers had retired to bed,
leaving the trainees to their own devices. The seven got on board a yacht
moored off the island and set it in motion. They collided with another yacht, the
property of the respondents, and damaged it. The respondents sued the Home
Office for the amount of the damage. A preliminary issue was ordered to be
tried whether on the facts pleaded in the statement of claim the Home Office,
its servants or agents owed any duty of care to the respondents capable of
giving rise to a liability in damages with respect to the detention of persons
undergoing sentences of borstal training, or with respect to the manner in
which such persons were treated, employed, disciplined, controlled or
supervised whilst undergoing such sentences. It was admitted that the Home
Office would be vicariously liable if an action would lie against any of the
borstal officers. On appeal against the decision of the preliminary point in
favour of the respondents,

Held (Viscount Dilhorne dissenting) The appeal would be dismissed because

(i) (per Lord Reid, Lord Morris of Borth-y-Gest and Lord Pearson)
(a) the taking by the trainees of the nearby yacht and the causing of
damage to the other yacht which belonged to the respondents ought to have
been foreseen by the borstal officers as likely to occur if they failed to exercise
proper control or supervision; in the particular circumstances the officers prima
facie owed a duty of care to the respondents (see p 297 c, p 298 a, p 303 j to p
304 a, p 304 g and p 321 b, post); dictum of Lord Atkin in Donoghue (or
MAlister) v Stevenson [1932] All ER Rep at 11 applied;
(b) the fact that the immediate damage to the property of the respondents
was caused by the acts of third persons, the trainees, did not prevent the
existence of a duty on the part of the officers towards the respondents
because (per Lord Reid) the taking of the yacht and the damage to the other
was the very kind of thing which the officers ought to have seen to be likely, or
(per Lord Morris of Borth-y-Gest and Lord Pearson) the right of the officers to
control the trainees constituted a special relation which gave rise to an
exception to the general rule that one person is under no duty to control
another to prevent his doing damage to a third (see p 300 f and h, p 307 g and
p 321 j, post); dictum of Dixon J in Smith v Leurs (1945) 70 CLR at 261, 262,
applied;
(c) the fact that something was done in pursuance of statutory authority did
not warrant its being done unreasonably so that avoidable damage was
negligently caused (see p 301, b, p 305 c and p 322 c and g, post); dictum of
Lord Blackburn in Geddis v Proprietors of Bann Reservoir (1878) 3 App Cas at
455 applied;

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 (d) there was no ground in public policy for granting complete immunity from
liability in negligence to the Home Office or its officers (see p 302 j, p 309 f and
p 323 b, post).
(ii) (per Lord Diplock) there was material, fit for consideration at the trial,
for 294 holding both that the officers were acting in breach of instructions
and ultra vires and that they owed a duty of care to the respondents (see p 333
g and & p 334 j to p 335 a, post).
Decision of the Court of Appeal sub nom Dorset Yacht Co Ltd v Home Office
[1969] 2 All ER 564 affirmed.

Haynes v Harwood

To give a cause of an action for negligence an act must be the neglect of

some duty owed to the plaintiff. The duty need not be expressly directed to the
plaintiff; if it includes him. as one of the class affected by the want of care, that
is negligence of which he can avail himself as a cause of action. A person is
guilty of a want of reasonable care if he leaves horses unattended in a
crowded street in which many people, especially children, are likely to be at
that time. If the horses bolt owing to the act of a mischievous child, that is, on
the part of the driver, a failure to use reasonable care for the safety of persons
lawfully using the highway. Any person, and a fortiori a police officer, trying to
stop the runaway horses would fall within the category of lawful users of the
highway.

The defence of novus actus interveniens is not available to a defendant in an

action for negligence if what is relied on as novus actus (eg, the act of a
mischievous child) is the very thing which is likely to happen as a result of the
negligent act - in other words, if the damage suffered by the plaintiff might well
be anticipated as a natural and probable result of the negligence.

Where the plaintiff has, under an exigency caused by the defendant's wrongful
misconduct, consciously and deliberately faced a risk, even of death, to rescue
another from imminent danger of personal injury or death, whether the person
endangered is one to whom he owes a duty of protection, as a member of his
family, or is a mere stranger to whom lie owes no such special duty, and the
plaintiff has thereby suffered injury, the defence of volenti non fit injuria is not
available to the defendant.

Dictum of SCRUTTON, LJ, in Cutler v United Dairies (London) Ltd (1) [1933] 2 KB
297, not applied.

A police constable sustained personal injuries while stopping runaway horses,

which had bolted owing to the negligence of the defendants' servant. In an
action by him against the defendants for negligence,

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Held: that as the plaintiff had a moral, if not a legal, duty to prevent injury to
persons lawfully using the highway, the principle of volenti non fit injuria did not
apply, and he was entitled to recover damages from the defendants.

Videan v BTC

The infant plaintiff, the youngest son of the stationmaster of a small railway
station who lived in the station house with his wife and four children, made his
way on to the railway line not far from the barrow crossing for porters with
barrows. To be on the railway line was prohibited to everyone except railway
employees on their lawful occasions. At the same moment as the infant plaintiff
was seen on the line by his father, the stationmaster, and a porter, they saw a
motor trolley driven by an employee of the defendants, approaching him
along the railway line. The stationmaster and the porter signalled the trolley
driver to stop, but he only slowed down and only at the last moment did he see
the infant plaintiff. In an effort to save his son, the stationmaster leaped from the
platform on to the line and saved the infant plaintiff, who was badly injured, but
was himself killed instantaneously. In an action for damages by the infant
plaintiff for his injuries, and under the Fatal Accidents Acts, 1846 to 1959, and
the Law Reform (Miscellaneous Provisions) Act, 1934, by the plaintiff widow in
respect of the death of her husband, the trial judge found that the trolley driver
was negligent in not keeping a proper look-out, in travelling too fast, and in not
applying his brakes hard enough and soon enough, and dismissed both claims,
the infant plaintiffs on the ground that he was a trespasser and the widows on
the ground that a rescuer could be in no better position than the rescued. On
appeal,

Held (i) the infant plaintiff was not entitled to recover damages because, on
the facts, he was a trespasser on the railway line (see p 864, letter d, p 868,
letter i, and p 872, letter h, post) and the trolley driver owed him no duty since
his presence on the line was not reasonably foreseeable (see p 871, letter h, p
876, letter d, and p 867, letter f, post),
(ii) the widow was entitled to recover compensation in respect of the death
of her husband, the stationmaster, because
(a) (per Lord Denning, MR), the occurrence of an emergency (not necessarily
the emergency that in fact happened) was foreseeable by the driver of the
trolley, who should have realised that someone might be put in peril if the trolley
approached too fast and without a proper look-out being kept, and
accordingly the trolley driver owed a duty to any person who attempted to
rescue another from a danger thus created (see p 868, letters a and b, post).
(b) (per Harman and Pearson, LJJ), the presence of the stationmaster, an
employee of the defendants, on the track was something that was reasonably
foreseeable by the driver of the trolley, and accordingly he owed a duty to the
stationmaster, who was not a trespasser on the line (see p 872, letters b and c,
and p 876, letters g and h, post).
Semble: if the presence of trespassers on land is known, or reasonably

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foreseeable, some duty of care is owed by an occupier of the land or
contractor or other person lawfully on the land (see p 866, letter a, p 870, letter
i, and p 874, letter h, post); that duty is (per Lord Denning, MR), a duty to use
reasonable care, or (per Pearson, LJ), a duty, substantially less than the duty
owed to a lawful visitor, to treat the trespasser with common 860 humanity
(see p 866, letter a, and p 875, letter f, post), but (per Lord Denning MR, Pearson
LJ, differing) this principle applies only where the person alleged to owe the
duty conducts operations on the land (see p 867, letter b, post; cf, p 873, letter
g, and p 830, letter e, post).
Robert Addie & Sons (Collieries), Ltd v Dumbreck ([1929] All ER Rep 1);
Buckland v Guildford Gas Light & Coke Co ([1948] 2 All ER 1086); Hardy v
Central London Ry Co ([1920] All ER Rep 205), and Mourton v Poulter ([1930] All
ER Rep 6) considered.
Per Lord Denning MR, the right of the rescuer to maintain an action for
negligence is an independent right, not derived from that of the victim (see p
867, letter i, post).
Haynes v G Harwood & Son ([1934] All ER Rep 103) and Baker v T E Hopkins &
Son, Ltd ([1958] 3 All ER 147) considered.

Carslogie v Royal Norweigian Govt. [1952] A.C. 292

On 26 November 1941, the respondents vessel, Heimgar, while under time

charter to the Ministry of War Transport, suffered damage in a collision with the
appellants vessel, Carslogie, for which, it was admitted, the Carslogie was
solely to blame. After temporary repairs to the Heimgar had been effected in
England the ship proceed to a port in the United States where permanent
repairs could be carried out. During her voyage across the Atlantic the vessel
sustained heavy weather damage which necessitated immediate repair. The
vessel remained in dry dock for fifty days during which time the repairs due to
the collision and those due to the weather were carried out concurrently, it
being agreed that ten days should be allocated to the repair of the collision
damage and thirty days to that of the weather damage. The respondents
claimed damages for loss of charter hire during the ten days attributable to the
collision damage.

Held The appellants were only liable for such loss of profit suffered by the
respondents as resulted from the appellants wrongful act; during the time that
the Heimgar was detained in dock she had ceased to be a profit-earning
machine because the heavy weather damage had rendered her
unseaworthy; and, therefore, the respondents had sustained no damage by
reason of the fact that for ten days the vessel was undergoing repairs in respect
of the collision damage.

Vitruvia SS Co v Ropner Shipping Co (1925 SC (HL) 1), The Hauk (1927) (30
Lloyd, LR 32) and The Haversham Grange ([1905] P 307), applied.
Per curiam: The decision in The Haversham Grange ([1905] P 307) with regard

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to the apportionment of dock dues incurred in connection with the repair of
collision damage was inconsistent with principle.

Baker v Willoughby
In September, 1964, the plaintiff suffered serious injuries to his left leg in an
accident on the highway caused by the negligent driving of a motorist, the
defendant, but attributable as to one quarter to the plaintiffs contributory
negligence. After prolonged hospital treatment the plaintiff re-entered
employment. In May, 1966, he had good functional movement in his left leg,
but the medical view at that time was that degenerative changes would
develop and would eventually limit his activities. He was less well able as a
result of the accident to compete in the labour market, and his earning
capacity was reduced. The court would have assessed, before 29 November
1967, the plaintiffs general damages as 1,200 (ie 1,600 less 400). On 29
November 1967, in the course of the plaintiffs employment he was an innocent
victim of an armed robbery in which he received gunshot wounds necessitating
the immediate amputation of his defective left leg. On the question of the
amount of damages for the plaintiffs injuries in the traffic accident of
September, 1964, which came before the court for assessment in February,
1968.

Held The plaintiffs loss from the traffic accident in September, 1964, was in no
way reduced by the amputation of his leg consequent on the injury to him in
the robbery on 29 November 1967, and accordingly the damages which would
have been recoverable from the defendant immediately prior to his injury in
the robbery should not be reduced; the plaintiffs general damages, therefore,
would be assessed at 1,200 (see p 240, letters a and g, post).
Principle in The Haversham Grange ([1905] P 307) applied.
The Carslogie ([1952] 1 All ER 20) considered.

Jobling v Associated Dairies

In 1973 the appellant slipped and fell in the course of his employment, the
accident being caused by the employers breach of statutory duty. The plaintiff
suffered a back injury and was thereafter able to do only light work. His earning
capacity was reduced by 50%. He brought an action against his employers, but
before the action came on for trial he was found in 1976 to be suffering from a
spinal disease which was unrelated to the accident but which rendered him
wholly unfit to work. At the trial of the action against the employers in 1979 in
respect of the 1973 accident the employers were found to be liable. The trial
judge refused to take into account the supervening disease and awarded
damages which included loss of earnings based on 50% earning capacity from
the date of total incapacity (1976) to the date of trial and for seven years
thereafter. On appeal, the Court of Appeal ([1980] 3 All ER 769) held that where
an injury caused to a plaintiff by a tort was obliterated by and submerged in a
greater injury caused by a supervening illness or other non tortious event the
liability of the tortfeaser ceased, and accordingly the employers were not liable
for the appellants loss of earnings from the time when the disease rendered

Page 109 of 169

him wholly unable to work. The appellant appealed to the House of Lords,
contending that where a disease or illness was not latent or dormant at the
time of the injury but was contracted after and independently of the injury it
was irrelevant to the assessment of damages for the injury, since the employers
were required to take the appellant as they found him, namely as someone
who was at the time of the injury a healthy person who might or might not after
the injury suffer a supervening and unconnected illness.

Held In the circumstances the damages awarded to the appellant for loss of
earnings were to be assessed according to the principles that the vicissitudes of
life were to be allowed for and taken into account when assessing damages so
that the plaintiff was not over-compensated, and that a supervening illness
apparent and known of before the trial was, whether it was latent or not at the
time of the prior injury, at the time of the trial a known vicissitude about which
the court ought not to speculate when it in fact knew. Accordingly, the
employers were not liable for any loss of earnings suffered by the appellant
after the onset of the disease in 1976 and his appeal would be dismissed (see p
755 b h g, p 757 d g h, p 759 d h j, p 760 a to c and e f j, p 764 a b g, p 766 j to p
767 a and h to p 768 a h, post).
Baker v Willoughby [1969] 3 All ER 1528 not followed.
Per Curiam. When a plaintiff has suffered disabling injuries from two or more
successive and independent tortious acts the question whether the
supervening disability caused by the second tort should be disregarded when
assessing the first tortfeasors liability for loss of earnings remains open (see p 754
f g, p 759 g, p 760 g to j, p 763 e to g and j to p 764 d f g and p 768 b e to h,
post); Baker v Willoughby [1963] 3 All ER 1528 doubted.
Per Lord Wilberforce. To attempt a solution of the problems arising where
there are successive causes of incapacity according to classical juristic
principles and common law 752 rules is in many cases no longer possible
because other sources of compensation (eg criminal injuries compensation,
sickness benefit etc) may, if not taken into account in assessing damages, lead
to the plaintiff being ultimately over-compensated (see p 755 c to e and j,
post).
Decision of the Court of Appeal [1980] 3 All ER 769 affirmed.

Remoteness in Torts

The Wagon Mound No. 1

In the law of negligence the test whether the consequences were reasonably
foreseeable is a criterion alike of culpability and of compensation; and the
dichotomy whereby culpability (viz, breach of duty to take reasonable care)
was regarded as depending on the foreseeability of consequences but
compensation (viz, the remoteness of damage) depended on whether the
negligent act or omission was the direct cause of the damage, whether
foreseeable or not, was a false dichotomy (see p 415, letters f and g, p 412,

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letter g, and p 414, letter h, post).
Dictum of Lord Russell of Killowen in Hay (or Bourhill) v Young ([1942] 2 All ER at
p 401) and dictum of Bovill CJ in Sharp v Powell ((1872), LR 7 CP at p 258)
approved.
Re Polemis and Furness, Withy & Co Ltd ([1921] All ER Rep 40) and dicta of
Lord Sumner in Weld-Blundell v Stephens ([1920] AC at p 984) and of Asquith LJ
in Thorogood v Van Den Berghs & Jurgens Ltd ([1951] 1 All ER at pp 690, 691)
disapproved.
By the carelessness of the appellants servants furnace oil from a ship was split
into a bay. The oil spread over the water to the respondents wharf, which was
some six hundred feet distant and at which the respondents were carrying out
repairing work to a ship, including the welding of metal. Molten metal from the
respondents wharf fell on floating cotton waste which, smouldering, ignited the
furnace oil on the water. The respondents wharf sustained substantial damage
by fire. The oil itself, unignited, also caused slight damage to the respondents
wharf, but no claim to compensation was made for this damage a. In an action
by the respondents for damages for negligence it was found as a fact that the
appellants did not know and could not reasonably have been expected to
know that the furnace oil was capable of being set alight when spread on
water.
Held The test of liability for the damage done by fire was the foreseeability of
the injury by fire (see p 415, letter g, post) and, as a reasonable man would not,
on the facts of this case, have foreseen such injury, the appellants were not
liable in negligence for the damage, although their servants carelessness was
the direct cause of the damage.
Per Curiam: it is a principle of civil liability, subject only to qualifications which
have no present relevance, that a man must be considered to be responsible
for the probable consequences of his act. To demand more of him is too harsh
a rule (see p 413, letter e, post).
Appeal allowed.

Smith v Leech

S was employed by the defendants as a labourer and galvanizer. Part of his

work consisted in lowering articles into a tank of molten metal and flux and
subsequently removing them. Whilst he was so engaged, a piece of molten
metal spattered out and burned his lip. He later contracted cancer, underwent
operations, and died. It was found that the defendants had been negligent,
and that the burn was the promoting agency, promoting cancer in tissues
which already had a pre-malignant condition. His widow, suing as administratrix
and on her own behalf and on behalf of dependent children, claimed
damages under the Law Reform (Miscellaneous Provisions) Act, 1934, for loss of
expectation of life, and under the Fatal Accidents Acts, 1846 to 1908, on the
basis of the burn resulting in cancer causing Ss death.

Held For the purpose of assessing damages a tortfeasor took his victim as he
found him, and the decision in Overseas Tankship (UK) Ltd v Morts Dock &

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Engineering Co Ltd ([1961] 1 All ER 404) did not override this principle;
accordingly, since the type of injury which S suffered, was reasonably
foreseeable, the defendants were liable for the damages claimed, although
they could not reasonably have foreseen the ultimate consequences of the
initial injury, viz, that the burn would cause cancer from which S would die.

Hughes v Lord Advocate

On 8 November 1958, the appellant, who was then aged eight, was in
company with another boy aged ten in Russell Road, Edinburgh. There, near
the edge of the roadway, was a manhole, some nine feet deep, over which a
shelter tent had been erected, and four paraffin warning lamps were placed at
its corners. Post office employees opened the manhole for the purpose of
getting access to a telephone cable. The time was about 5 pm, and the site
was unattended, the employees having left for a tea-break. They had removed
the ladder from the manhole, leaving the ladder beside the shelter; and they
had pulled a tarpaulin cover over the entrance to the shelter, leaving a space
of about two feet between the lower edge of the tarpaulin and the ground.
The lamps were left burning. The boys took one of the paraffin lamps and the
ladder into the tent to explore. Shortly thereafter the appellant tripped over the
lamp, which fell into the manhole. An explosion followed. The appellant was
thrown into the manhole and suffered severe burns. On the evidence the
cause of the explosion was found to be that paraffin from the lamp escaped,
formed vapour and was ignited by the flame; this particular development of
events was not reasonably foreseeable, according to the expert evidence, but
there was no other feasible explanation and this explanation was accepted as
established.

Held Although in the law of negligence the duty to take reasonable care was
confined to reasonably foreseeable dangers, the fact that the danger actually
materialising was not identical with the danger reasonably foreseeable did not
necessarily result in liability not arising; in the present case the happening of an
accident of the type that did occur, viz, an accident to a child through burns,
was reasonably foreseeable, and the further fact that the development of the
accident as it actually happened (viz, the occurrence of the explosion) could
not reasonably have been foreseen did not absolve the defendants from
liability, and accordingly the plaintiff was entitled to recover damages for
negligence (see p 710, letter e, p 712, letter e, p 714, letter g, p 706, letter f, p
708, letter c, and p 715, letters g and i, post).
Glasgow Corpn v Muir ([1943] 2 All ER 44) distinguished.
Donoghue v Stevenson ([1932] All ER Rep 1) considered.
Appeal allowed.

Liesbosch Dredger v Edison

The plaintiffs' dredger, the L, was sunk in a collision with the defendants'
steamship, for which the defendants admitted liability. At the time of the loss
the plaintiffs were performing certain works in the harbour at P, under contract

Page 112 of 169

with the harbour commissioners, and the dredger was employed in essential
dredging operations connected with the performance of the contract. After
the collision the plaintiffs were unable, owing to their lack of financial resources,
to purchase another dredger, and, in consequence, various delays involving
loss and expense were incurred. Subsequently, the plaintiffs hired another
dredger, which they ultimately purchased. The registrar, in his report, allowed a
sum for the value of the dredger, and also sums for the losses and expenses
incurred during the delay, including the cost of hire of the substituted dredger,
the extra cost of dredging with the substituted dredger as compared with the
lost dredger, and loss of profit and incidental losses, such as salaries, rent, and
interest, incurred during the period when the contract could not be performed
owing to the loss of the dredger.

Held: the plaintiffs were entitled to the value of the L at P as a going concern at
the time and place of the loss, together with interest at 5 per cent. as from the
date of the loss until payment, and that value must be assessed by taking into
account (i) the market price of a comparable dredger in substitution;

(ii) costs of its adaptation to make it fit for the performance of the contract
work and of its transport to P, insurance, &c; and (iii) compensation for
disturbance and loss in carrying out the contract over the period of delay
between the loss of the L and the time at which the substituted dredger could
reasonably have been available for use in P, including in that loss such items as
overhead charges, expenses of staff, and equipment thrown away, but
excluding any loss due to the appellants' financial position and their
consequent inability at once to buy a substitute dredger and the resulting
delay in proceeding with the work as (a) being damage which did not flow
from the defendants' tort, or (b) if it did, was too remote.

SCM (UK) ltd Whittal

The plaintiffs were manufacturers of typewriters and copying machines. The

defendants, who were building contractors, were carrying out construction
works in the vicinity of the plaintiffs factory when they damaged a high
voltage cable supplying the factory with electricity required for the operation
of manufacturing machinery. The plaintiffs did not own or have any possessory
or proprietary rights in the damaged cable. The damage to the cable caused
a power failure at the factory. The plaintiffs alleged that the defendants knew
or ought to have known of the presence and position of the cable and that it
carried electric current to supply factories such as the plaintiffs with power for
their plant and machinery; and that it was reasonably foreseeable by the
defendants that if they damaged the cable the supply of electric current to
the factories supplied by it would be likely to be interfered with and fail, and
that, in that event, occupiers of premises such as the plaintiffs would be likely to
suffer loss and damage including injury to their property. Paragraph 5 of the
plaintiffs statement of claim stated: In the circumstances the Defendants
owed a duty to the Plaintiffs to take reasonable care when carrying out the

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said operations not to damage the said cable. The plaintiffs claimed, inter alia,
damages for loss of one days production of typewriters and copying
machines, together with the value of certain items which were damaged by
the solidification of raw material in the machines at the time of the power
failure. Counsel for the plaintiffs gave an assurance to the court that he
confined the claim to the material damage to the machines and to the loss of
production consequent on that damage.

Held The defendants were in breach of the duty of care which they owed to
the plaintiffs not to damage the cable because they knew that the cable
supplied electricity to the plaintiffs factory and that if they damaged the cable
the electricity would be cut off, which would cause damage to the plaintiffs;
accordingly, the defendants were liable to the plaintiffs for all the material
damage suffered by them and any loss of profit consequent thereon (see p 249
h to p 250 a, p 252 h, p 258 e and p 262 c, post).
Dictum of Lord Atkin in Donoghue v Stevenson [1932] All ER Rep at 11 applied.
Seaway Hotels Ltd v Cragg (Canada) Ltd and Consumers Gas Co (1959) 17
DLR (2d) 292(so far as it concerned the spoiling of the food), on appeal (1960)
21 DLR (2d) 264 and British Celanese Ltd v A H Hunt (Capacitors) Ltd [1969] 2 All
ER 1252 approved.
Per Lord Denning MR. In actions of negligence, when the plaintiff has suffered
no damage to his person or property, but has only sustained economic loss, the
law does not usually permit him to recover that loss. Although the defendants
owed the plaintiffs a duty of care, that did not mean that additional economic
loss which was not consequent on the material damage suffered by the
plaintiffs would also be recoverable; in cases such as Weller & Co v Foot and
Mouth Disease Research Institute ([1965] 3 All ER 560) and Electrochrome Ltd v
Welsh Plastics Ltd ([1968] 2 All ER 205), the plaintiffs did not recover for 245
economic loss because it was too remote to be a head of damage, not
because there was no duty owed to the plaintiffs or because the loss suffered
in each case was not caused by the negligence of the defendants (see p 250
b, c and f, p 251 c and p 257 f, post).
Per Winn LJ. Apart from the special case of imposition of liability for negligently
uttered false statements, there is no liability for unintentional negligent infliction
of any form of economic los which is not itself consequential on foreseeable
physical injury or damage to property (see p 258 b, post).
Decision of Thesiger J [1970] 2 All ER 417 affirmed.

Spartan Steel & Alloy v Martin & Co.

The plaintiffs manufactured stainless steel alloys at a factory which was directly
supplied with electricity by a cable from a power station. The factory worked 24
hours a day. Continuous power was required to maintain the temperature in a
furnace in which metal was melted. The defendants employees, who were
working on a near-by road, damaged the cable whilst using an excavating
shovel. The electricity board shut off the power supply to the factory for 14 1/2

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hours until the cable was mended. There was a danger that a melt in the
furnace might solidify and damage the furnaces lining, so the plaintiffs poured
oxygen on to the melt and removed it, thus reducing its value by 368. If the
supply had not been cut off, they would have made a profit of 400 on the
melt, and 1,767 on another four melts, which would have been put into the
furnace. They claimed damages from the defendants in respect of all three
sums. The defendants admitted that their employees had been negligent, but
disputed the amount of their liability.

Held (i) The defendants were liable in respect of the physical damage to the
melt and for the loss of profit on it, for that loss was consequential on the
physical damage (see p 564 f, p 565 b and p 574 a, post); SCM (United
Kingdom) Ltd v W J Whittall & Son Ltd [1970] 3 All ER 245 followed.
(ii) (Edmund Davies LJ dissenting) the defendants were not liable for the loss of
profit on the other four melts because
(a) no remedy was available in respect of economic loss unconnected with
physical damage (see p 564 g and p 573 h to p 574 a, post); Cattle v Stockton
Waterworks Co [187480] All ER Rep 220 followed;
(b) there was no principle of parasitic damages in English law to the effect
that there were some heads of damage which, if they stood alone, would not
be recoverable, but would be if they could be annexed to some other claim
for damages, ie that the economic loss in respect of the four melts was
recoverable as a parasite by being attached to the claim in respect of the
first melt (see p 561 c d and g and p 573 h, post); Re London, Tilbury and
Southend Railway Co & Gowers Walk Schools Trustees (1889) 24 QBD 326,
Horton v Colwyn Bay and Colwyn Urban Council [1908] 1 KB 327 and Griffith v
Richard Clay & Sons Ltd [1912] 2 Ch 291 explained.
Per Lord Denning MR. At bottom the question of recovering economic loss is
one of policy. Whenever the courts draw a line to mark out the bounds of duty,
they do it as a matter of policy so as to limit the responsibility of the defendant.
Whenever the courts set bounds to the damages recoverablesaying that
they are or are not, too remotethey do it as a matter of policy so as to limit
the liability of the defendants. The time has come to discard the tests which
have been propounded in the reported cases and which have proved so
elusive. It is better to consider the particular relationship in hand, and see
whether or not, as a matter of policy, economic loss should be recoverable
(see p 561 j and p 562 g, post).
Per Lawton LJ. The differences which undoubtedly exist between what
damage can be recovered in one type of case and what in another cannot
be reconciled on any logical basis. Such differences have arisen because of
the policy of the law and it may be that there should be one policy for all
cases; but the enunciation of such a policy is not a task for the court (see p 573
b, post).

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INJURIES TO THE PERSON

Davies v. Powell Duffryn Associated Colliers (No.2)

The husbands of the appellants were fatally injured by an explosion in a coal
mine belonging to the respondents. The appellants, each of them suing as
administratrix of her deceased husband, brought actions against the
respondents for breach of statutory duty and negligence. Each claimed
damages (i) under the Fatal Accidents Acts 1846 to 1908, on behalf of the
deceased's dependants, and (ii) under the Law Reform (Miscellaneous
Provisions) Act 1934, in respect of the deceased's shortened expectation of life.
The appellants contended that no allowance should be made in assessing

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damages under the Fatal Accidents Acts in respect of any damages awarded
under the 1934 Act:
Held in assessing damages under the Fatal Accidents Act 1846, damages
awarded under the Law Reform (Miscellaneous Provisions) Act 1934, must be
taken into account in the case of dependants who will benefit under the latter
Act.

MATTERS TO BE TAKEN INTO ACCOUNT

Cornillac v. St. Louis 7 WIR 491

The considerations which ought properly to have been borne in mind in
assessing the general damages were:
(a) the nature and extent of the injuries sustained;
(b) the nature and gravity of the resulting physical disability;

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 (c) pain and suffering;
(d) loss of amenities;
(e) the extent to which pecuniary prospects were affected.
Lord Goddards in British Transport Commission v Gourley said:
In an action for personal injuries the damages are always divided into
two main parts. First, there is what is referred to as special damages,
which has to be specially pleaded and proved. This consists of out-of-
pocket expenses and loss of earnings incurred down to the date of the
trial, and is generally capable of substantially exact calculation.
Secondly, there is general damage which the law implies and is not
specially pleaded. This includes compensation for pain and suffering and
the like, and, if the injuries suffered are such as to lead to continuing or
permanent disability, compensation for loss of earning power in the
future.
The loss of pecuniary prospects was not an item of special damage but one of
the class of items to be taken into account in the assessment of general
damages.

Sarju v. Walker (No. 1) 21 WIR 86

There can be little dispute but that compensation for injuries should be fair.
Perfect compensation is hardly possible, and can be unjust in certain
circumstances.
In awarding damages for injuries, a court must look at the overall figure at the
end, and to arrive at the figure, awards must be made under the well
recognised heads; a court cannot award a plaintiff precise compensation, but
he will be awarded fair compensation in all the circumstances;
An award in respect of prospective earnings is intended to compensate an
injured person for money he would have earned during his normal working life
but for the accident;
CUMMINGS JA, dissenting) that a court has a discretion to award, or not to
award, costs and where a trial judge has shown that he has exercised that
discretion, the Court of Appeal will not interfere

CAVEATS

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Aziz Ahamed v. Raghubar (1967)
The respondent at age 40 suffered serious injury in a motor collision. He
sustained a fractured dislocation of the 11th and 12th dorsal vertebrae resulting
in complete paralysis of the lower limbs from the waist downwards
(paraplegia); he was unable to walk except with the aid of crutches and
double calipers, and he was incapable of controlling the action of his bladder
and bowels. He also suffered total sexual impotence. At the time of the collision
the respondent was a truck driver earning $7.20 per day and had a wife and six
children. He played cricket and billiards. His injuries rendered him almost useless
and his wife had left him. A judge assessed damages at $48,263.80 of which
$48,000 was general.
On appeal,
Held: (i) that in this jurisdiction where assessments of general damages are
made by judges without the aid of juries, it is now an accepted principle that
courts should strive for as high a measure of uniformity of awards as is
reasonably practicable;
(ii) that there is no warrant for maintaining an equiparation of the Trinidad dollar
and the English pound.
(iii) that the judge's award was not inordinately high.
Appeal dismissed. Award of damages varied to include an agreed sum of
$2,750 for actual loss of earnings.

PAIN AND SUFFERING AND LOSS OF AMENITIES

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DeSouza v. Trinidad Transport Ltd v. Nanair (No.1)
DND was 35 years old when the motor car he was driving on 7 November 1963,
became involved in a collision with a motor truck with trailer attached owned
by the defendant company and driven by BN DND was a marine engineer; he
was well qualified for his employment as a senior jack operator by the Skinner
Drilling Co, and his future prospects were good. He was a happily married
family man with two children; his hobbies included swimming, fishing, dancing,
cricket, and football, and he enjoyed reading, the cinema, and a social life. He
was agreeable and of a pleasant disposition. After the collision DND remained
unconscious for 72 hours in a public hospital. He suffered severe shock and loss
of blood. He had sustained:
(a) a fracture at the base of the skullwith associated brain damage;
(b) a penetrating wound at the back of the right shoulder with severe
damage to the brachial plexus;
(c) a fracture of the right elbow involving the elbow joint;
(d) a fracture of the right femur of the upper third of the shaft; and
(e) a crushed fracture of the body of the twelfth dorsal vertebra.
Early in March 1964, DND began to suffer from blackouts and clonic spasms of
the arms and legs due to brain damage. A few months later he developed
paralysis of both legs from the hips down (spastic paraplegia) and his right leg
had to be amputated. He has no control over his bladder or bowels and he
became sexually impotent. He will remain an invalid in need of constant nursing
for the rest of his life, and he will not be able to use either crutches or a wheel
chair. He is committed to a life in bed. His personality has deteriorated and his
mental capacity is seriously impaired; he has become selfish and suspicious
and his residual disability was estimated at 100 per cent. The trial judge found
the driver of the defendant company's vehicle to be wholly responsible for the
collision.
Held: (i) that the considerations to be borne in mind in assessing general
damages were:
(a) the nature and extent of the injuries sustained;
(b) the nature and gravity of the resulting physical disability;
(c) the pain and suffering which had to be endured;
(d) the loss of amenities suffered; and
(e) the extent to which consequentially the plaintiff's pecuniary prospects
have been materially affected. Cornilliac v St Louis ((1965), 7 WIR 491)
applied and followed.
(ii) that in ascertaining trends in awards in comparable cases attention need
not be restricted to cases in which the nature of the injuries and the gravity of
the consequences suffered bear a close affinity to the claimant's.
Judgment for plaintiff. Damages awarded: $206,726.92.

Leonard (an infant) v. Forbes

Illustrates that pain and suffering is assessed subjectively so that if the claimant is
not capable of experiencing the pain or suffering no damages will be awarded

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for pain and suffering. In this case the claimant was aware of his condition but
experienced no pain and suffering.
The appellant, a youth aged 15, was injured as a result of the negligent driving
of the first respondent an employee of the second respondent. In the accident
which occurred on 31 October 1966, the appellants skull and ribs were
fractured and his brain and nerve tracts were permanently damaged so that
he is now a spastic. He has been a patient in hospital ever since and was
deeply unconscious for five months as a result of the accident.
Held: the award of general damages would be increased to $37,000 for the
following reasons:
(i) a person in the position of the appellant is entitled to reasonable
compensation not only for the severe physical injuries he has sustained, but also
in respect of the grave and sombre deprivations which he will suffer
throughout his life, and that as the trial judge has found he has suffered the loss
of all the amenities of life substantial compensation should be awarded, and
more so as he has a long expectation of life and is able to appreciate his
condition;
(ii) an award must also be made to meet the special need to provide for
continuous care for the appellant over a long period of time;
(iii)the appellant, though a casual worker, has been forever deprived of the
opportunity to earn his wages, however small, and to improve his earning
capacity in employment.
Lewis CJ said:
Although the trial judge did not specifically mention the various heads as set
out in Wooding CJs judgment, his evaluation of the evidence indicates that he
took account of them. He particularly states that the appellant was a casual
employee with a low income, that there is no chance of his leading a normal
life, and that he would need constant care as he could not look after himself.
The conclusion to be drawn from these findings must be that for the rest of his
life he would be unable to work and that his loss of future earnings must be
assessed on the basis of a low income.
Although the plaintiff according to the medical evidence did not suffer pain
yet he was very seriously injured and has suffered a loss of all the amenities of
life. I have already referred to the appellants spastic condition. No
regeneration of the nerves is expected. The appellant is aware that his
prospects for the future are hopeless, for he said in his evidence: I am in the
hospital for I was licked out of this world. I thought I was dead. According to
the medical evidence he is mentally alert and willing but cannot do what he
wants to do because of the brain damage. His frustration must be well nigh
intolerable. He has no sense of balance when standing. He was trained by his
father, a sea captain, to sail a boat, but will never be able to enjoy the
pleasures of sailing. He used to play cricket and drive a car, but now he
cannot even walk without assistance.
The medical evidence establishes that the appellants expectation of life has
not been shortened. At the age of 19 he must therefore look forward to a
broken barren life beset with frustrations. His utter dependence upon the care
of others must add to his distress and anxiety.

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A plaintiff in the position of the appellant is entitled to reasonable
compensation not only for the severe physical injuries he has sustained, but also
in respect of the grave and sombre deprivations which he will suffer
throughout his life.

West (H) & Son Ltd v. Shephard

General damages for personal injuries are to compensate for results that have
actually been caused, which may consist both of physical loss (eg, loss of the
use of a limb) which is an objective element of damages, and of pain and
suffering, of frustration and the affliction of awareness of the loss and of loss of
expectation of life, which form a subjective element, and in relation to both
these elements, the period of probable duration (which may be the period of
expectation of life of the plaintiff) is relevant to be taken into; an injured person
who is rendered continuously unconscious is spared the subjective element,
and thus cannot recover compensation for it, but a court is not required to
segregate and assess separately the objective and subjective elements, both
of which may properly be covered by one comprehensive sum.
(ii) In assessing general damages for personal injuries there may be items of
need which should be taken into account (eg, future needs for special
treatment or for transport), but, apart from that, the consideration of what use
a plaintiff will thereafter make of the money recovered as damages is
irrelevant.
Lord Morris said:
An unconscious person will be spared pain and suffering and will not
experience mental anguish which may result from knowledge of what
has in life been lost or from knowledge that life has been shortened.. The
fact of unconsciousness is therefore relevant in respect of and will
eliminate those heads or elements of damages which can only exist by
being felt or thought or experienced. The fact of unconsciousness does
not, however, eliminate the actuality of the deprivations of the ordinary
experiences and amenities of life which may be the inevitable result of
some physical injury.

Wise v. Kaye

In assessing damages for negligence causing personal injuries

(a) the fact that the injured person is unlikely to live to enjoy personally the
damages awarded is not a ground for reducing the amount of general
damages awarded
(b) the injured person's lack of knowledge of his or her condition is no
ground for reducing the amount of general damages awarded to him or
her, save in regard to the factor of pain and suffering which may be
excluded thereby.
The plaintiff, a girl aged twenty, was rendered unconscious and received
serious injuries to her brain, which lessened her expectation of life. She was still
unconscious three and a half years after the accident, and was not expected

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ever to recover consciousness. At the time of the accident she was in
employment, and she was engaged to be married. The trial judge awarded
879 8s 11d special damages, being loss of earnings to the date of trial, 2,000
general damages for loss of probable future earnings, which was based on
probable earnings during the period the plaintiff might have been expected to
live but for the accident, 400 damages for loss of expectation of life, and
15,000 general damages for her physical injuries and the resultant loss of the
amenities of life. It was unlikely that she would be able personally to enjoy the
damages awarded or that they would be used to maintain her.
Held the award of 15,000 general damages, which in truth was an award for
loss of amenity, since pain and suffering and medical expenses and expenses
for future care could be excluded and loss of earnings and of expectation of
life had been separately assessed should not be disturbed, for in relation to a
living person it was not the court's duty to measure the damages according to
the loss of happiness occasioned by the injury but according to the physical
injury and consequent loss of amenity.
The award of 2,000 for loss of probable future earnings should be reduced to
1,500, because, in assessing damages for loss of probable future earnings, the
loss to be assessed was that during the curtailed period for which the plaintiff
was expected to live after the accident.

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LOSS OF EXPECTATION OF LIFE

Benham v. Gambling
A boy of the age of two-and-a-half years was killed in a road accident. The
damages for loss of expectation of life were assessed at 1,200:
Held the proper assessment of such damages in this case, where the
prospects of the boy were particularly favourable, was 200. The assessment of
such damages is not to be made upon an actuarial basis. It is not the
assessment of compensation for loss of years or for the loss of future pecuniary
prospects, but it is the fixing upon commonsense principles of a reasonable
figure for the loss of prospective happiness.

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THE LOST YEARS

Gammel v. Wilson

The Law Reform (Miscellaneous Provisions) Act 1934 s.1 does not preclude the
court from awarding a sum under s.1 for the deceased's loss of earnings during
the lost years in an action for the benefit of the deceased's estate under the
Act. (1) G, aged 15, was killed due to D's negligent driving. G's father claimed
damages under the Fatal Accidents Act 1976 for himself and his wife as
dependants, and under s.1 of the 1934 Act on behalf of G's estate. Damages
under the 1976 Act were extinguished by damages under the 1934 Act, which
amounted to GBP 9,590. That sum included GBP 6,656 in respect of loss of
earnings for G's lost years.(2) F, aged 22, was killed at work. The parents brought
proceedings under the Acts of 1976 and 1934. Damages under the 1976 Act
were likewise extinguished. Out of a total of GBP 19,106, the judge awarded a
sum of GBP 17,275 in respect of loss of earnings.Both defendants appealed to
the House of Lords, contending that the estate could not recover damages for
loss of future earnings since s.1 (c) of the 1934 Act precluded such an award.

Held, dismissing the appeals, that since the causes of action resting in G and F
immediately before death included damages for loss of earnings, they were
not precluded by s.1, and such damages

Pickett v. British R1 Engineering Ltd

A plaintiff whose life expectation is shortened by injury is entitled to damages

reflecting his prospective loss of earnings during the "lost years." At the age of
51, in 1974, the plaintiff contracted mesothelioma due to exposure to asbestos
dust at work. At the trial in 1976 (liability being admitted) it appeared that the
plaintiff's life expectancy had been reduced to one year, whereas without the
disease he could have worked until 65. He was awarded GBP 7,000 as general
damages with interest from the date of service of the writ, GBP 1,508 in respect
of loss of earnings and GBP 500 for loss of expectation of life. The Court of
Appeal held that no sum was payable in respect of loss of prospective earnings
during the "lost years" but increased the amount of general damages to GBP
10,000, without interest, and the amount for loss of expectation of life to GBP
750. (Prior to the appeal the plaintiff had died but the proceedings were
conducted by his widow as administratrix).

Held, allowing the appeal and cross-appeal of the administratrix and the
employers, that (1) (Lord Russell of Killowen dissenting) damages for loss of
prospective earnings during the lost years were recoverable, being computed

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by deduction of the plaintiff's likely living expenses had he lived, and that the
case would be remitted for such damages to be assessed; (2) the Court of
Appeal had erred in ordering that no interest was payable upon the general
damages; and (3) that since the trial judge had made no error of principle in
assessing the amount of general damages, the Court of Appeal had no
jurisdiction to substitute its own figure therefor and the original award would be
restored. ( Pope v D Murphy & Son [1961] 1 Q.B. 222 , Skelton v Collins (1966) 39
A.L.J. 480 and Davies v Powell Duffryn Associated Collieries Ltd [1942] A.C. 601
applied; Harris v Brights Asphalt Contractors Ltd [1953] 1 Q.B. 617 and Oliver
(Robin) v Ashman [1962] 2 Q.B. 210 overruled; dictum of Lord Denning M.R. in
Cookson v Knowles [1979] A.C. 556 disapproved).

Oliver v. Ashman

In assessing damages for personal injury to a plaintiff whose expectation of life

has been shortened, the loss of wages he would have earned after his death if
his life had not been shortened should not be taken into account as a separate
item: that loss forms part of the general damage for loss of expectation of life.
Quaere, whether it is relevant in assessing damages for a brain injury that it
prevents the plaintiff from needing or spending the damages. The plaintiff, a
twenty-month-old boy, was injured by the fault of the defendant in such a way
that he became a low-grade mental defective who would go (at his parents'
wish) to a private school and eventually to a state institution where no fees
were payable for the rest of his life; his expectation of life was reduced from
sixty to thirty years. The judge awarded GBP 11,000 damages, taking into
account as a separate item of damages the loss of earnings from thirty-one to
sixty. Both parties appealed on the quantum of damages.

Held, the appeals should be dismissed; the earnings between thirty-one and
sixty should not have been taken into account, but they formed so small a part
of the total sum that there was no substantial ground for varying the amount
awarded.

Harris v. Empress Motors Ltd

The duty which an employer owes to his servant was stated by Lord Herschell in
Smith in the following words: "It is quite clear that the contract between
employer and employed involves on the part of the former the duty of taking
reasonable care to provide proper appliances, and to maintain them in a
proper condition, and so to carry on his operations as not to subject those
employed by him to unnecessary risk." The duty is a duty not to subject the
employee to any risk which the employer can reasonably forsesee or, to put it
slightly lower, not to subject the employee to any risk that the employer can

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reasonably foresee and which he can guard against by any measures the
convenience and expense of which are not entirely disproportionate to the risk
involved. The plaintiff, aged 35, who was employed by the defendants as an
asphalt spreader, fell from the roof on which he was working nine inches from
the edge, on to a roof two feet below covered with asbestos which broke, and
thence to the floor. He sustained injuries which shortened his expectation of life
to a period between six months and two years from the date of trial.

Held, (1) the defendants were negligent as they should reasonably have
foreseen the accident and the accident was unnecessary in the sense that the
defendants could have provided against it by putting boards on the lower roof
which would have arrested the plaintiff's fall; (2) they were also in breach of the
Building (Safety, Health and Welfare) Regulations 1948 Reg.5 which requires
scaffolds to be provided for such work; had the plaintiff worked from boards
fixed to the lower roof, which he could have done in safety, that would have
been a scaffold within the meaning of the regulation; (3) there had been no
breach of Reg.31(3)(a) because the plaintiff did not have to work "above" the
fragile roof in the vertical plane; (4) a claim under Reg.31(3)(b) failed because,
although no notice stating that the coverings were fragile had been affixed
anywhere, it would have been a work of supererogation to have acquainted
the plaintiff by means of notices of that which he already knew; (5) there had
been no contributory negligence on the part of the plaintiff; (6) in considering
the general damages to be awarded one was not entitled to take into
consideration loss of earnings for the period between the prospective date of
the plaintiff's death and the date to which he would have lived had it not been
for the accident; loss of earnings were only relevant as a minor element when
considering the plaintiff's chance of a happy life in calculating the amount of
damages to be awarded for loss of expectation of life; (7) the plaintiff could
not recover damages in respect of nursing attendance, which, by reason of
the National Health Service Act, 1946, he was never likely to incur; (8) the
proper damages to award to the plaintiff, apart from the damages for loss of
earnings, would be GBP 500 for the shortening or loss of expectation of life and
GBP 5,000 for pain and suffering, Smith v Charles Baker & Sons [1891] A.C. 325 ,
Wilsons & Clyde Coal Co Ltd v English [1938] A.C. 57 and Caswell v Powell
Duffryn Associated Collieries Ltd [1940] A.C. 152 applied.

QUANTIFICATION

The Basis for the granting of an Award of Damages for wrongful death in
Jamaica is found on two Acts of Parliament, namely the Fatal Accidents Act
and the Law Reform (Miscellaneous Provisions) Act. The former gives a cause of
action to the deceased against the person who committed the offence for the
benefit of his dependents or, as the Act call them his Near Relations. The

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latter gives a separate cause of action to the deceased against the Offender
for the benefit f his estate.

s.3 Fatal Accidents Act

Whensoever the death of a person shall be caused by wrongful act, neglect or
default, and the act, neglect or default is such as would (if death had not
ensued) have entitled the party injured to maintain an action, and recover
damages in respect thereof, then and in every such case the person who
would have been liable, if death had not ensued, shall be liable to an action
for damages notwithstanding the death of the person injured and although the
death shall have been caused under such circumstances as amount in law to
felony.

s.4 Fatal Accidents Act

(1) Any action brought in pursuance of the provisions of this Act shall be
brought
(a) by and in the name of the personal representative of the deceased
person; or
(b) where the office of the personal representative of the deceased is
vacant, or where no action has been instituted by the personal
representative within six months of the date of death of the deceased
person, by or in the name of all or any of the near relations of the
deceased person, and in either case any such action shall be for the
benefit of the near relations of the deceased person.
(2) Any such action shall be commenced within, three years after the death of
the deceased person or within such longer period as a court may, if satisfied
that the interests of justice so require, allow.
(3) Only such action shall e brought in respect of the same subject matter of
complaint.
(4) If in any such action the court finds for the plaintiff, then, subject to the
provisions of subsection (5), the court may award such damages to each of the
near relations of the deceased person as the court considers appropriate to
the actual or reasonably expected pecuniary loss caused to him or her by
reason of the death of the deceased person and the amount so recovered
(after deducting the costs not recovered from the defendant) shall be divided
accordingly among the near relations.
(5) In the assessment of damage under subsection (4) the court
(a) may take into account the funeral expenses in respect of the deceased
person, if such expenses have been incurred by the near relations of the
deceased person;
(b) shall not take into account any insurance money, benefit, pension, or
gratuity which has been or will or may be paid as a result of the death;
(c) shall not take into account the remarriage or prospects of remarriage of
the widow of the deceased person.

There are three heads of recoverable loss:

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 (1) Pecuniary loss attributable to the non-business relationship between
deceased and dependent: this refers to the loss of support from the
deceaseds earnings as well as the loss of support from the deceaseds
future retirement pensions.
(2) Business pecuniary loss: this is not recoverable by the dependent if the
loss flows from the business relationship between the deceased and his
dependent.
(3) Proof of loss: there will be no award if the loss is entirely speculative or if
there is no reasonable expectation of pecuniary benefit as of right, or
otherwise, from the continuance of life.

Multiplier Method

The multiplier method is used to assess al pecuniary loss and not merely post-
trial pecuniary loss. The actual method of computing damages is found in
Case Law. In the Landmark decision of the House of Lords in the English Case of
Cookson v. Knowles Lord Diplock stated: as a general rule in Fatal Accident
cases the damages should be assessed in two parts, the first and less
speculative component being an estimate of the loss sustained up to the date
of trial and the second component as estimate of the loss to be sustained
thereafter.
The starting point of the multiplier is the estimated number of years (taking into
account e.g. the deceaseds and dependents life expectancies) from the
date of death that the dependent would have received the deceaseds
pecuniary support. When the deceased was unmarried and supporting his
parents account must also be taken of the possibility of the deceaseds
marriage.
- The starting figure is then adjusted. There is a reduction b/c the C is
receiving the capital sum now, which he can invest, rather than periodic
payments over the years.
- A further small reduction may be made for the contingencies of life,
other than mortality, such as the deceaseds possible unemployment.
The aim is to award a capital sum, which when invested will produce an
income in terms of interest and withdrawals of capital, equal to the
dependents lost income over the period intended to be covered (period of
dependency).
In the UK a rate of 2.5% is set and this applies to personal injuries and fatal
accident cases. Example: applying a discount rate of 2.5%, the multiplier (from
death) for calculating loss of dependency in respect of a wife, who was 30 yrs
old at the death of her 30 year old husband is about 23.

Rattray v. Muir & Ors

The deceased, a man 44 years of age in sound health, was fatally injured in a
road accident on 3 September 1964. He died leaving a widow 38 years of age
and five children aged 11 years, 81/2 years, 51/2 years, 4 years, and 2 years 9
months. At the date of his death the deceased was in receipt of an annual
income of $45,000 as president of a publishing company which after deduction

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of $18,000 for income tax and $430 for insurance policy premiums left a net
income of over $26,500. The deceased's personal expenditure was about
$2,500. It was anticipated that but for his death the deceased would have
continued in employment until the age of 65 years. There were certain benefits
accruing to the widow and children as a result of the deceased's death,
namely $36,411 arising under certain policies of insurance on the deceased's
life, $9,541 the value of the deceased's estate and $25,000 the value of certain
shares of the widow. If all these benefits were taken into consideration the gross
prima facie benefit would amount to $70,952. As to the social security benefits,
the children would receive a combined total of $50,089.56 at 21 years of age
while the widow would receive a total of $11,970 based on a dependency of
21 years.
Held: in assessing the damages the following factors should be taken into
account:
(i) the reasonable expectation of the deceased's working life;
(ii) the life expectation of the deceased's widow and children;
(iii) the ordinary chances and uncertainties of life including the possibility of
remarriage of the deceased's widow;
(iv) benefits accruing to the deceased's widow and children as a result of
the deceased's death including social security benefits payable to them. On
the claim under the Law Reform Law awarded 750. The special damages
have been agreed at 1,235.

Deonarine v. Narine

Pursuant to a claim for damages for negligence arising from a fatal accident a
judge awarded the respondent, inter alia, as administratrix of the estate of the
deceased, a sum of $517.17 for expenses in obtaining letters of administration in
his assessment of damages under the Supreme Court of Judicature Act 1962. In
his assessment under the Compensation for Injuries Ordinance he awarded
damages in the sum of $4,000 and $4,272 respectively to the two infant children
of the deceased aged 5 and 3 years. The widow had remarried comfortably
and the stepfather of the children was generously inclined towards them.
On appeal,
Held: (i) administration expenses cannot be claimed as an item of loss or
damage in actions for the benefit of a deceased person's estate under the
Supreme Court of Judicature Act 1962;
(ii) in computing the damages to be paid to the deceased's dependants under
the Compensation for Injuries Ordinance due account must be taken of (a) the
extent of their dependency on him, (b) their respective entitlements to the
damages awarded under the Supreme Court of Judicature Act, (c) the
insurance of his life under which benefits became payable to them, and (d) the
remarriage of a dependent spouse;
(iii) that the correct approach in a case of this kind is to ascertain the extent of
the loss of the children, if any, up to the date of the cesser of their dependency

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and then to evaluate the chance of the stepfather ceasing to be as he is at
present or of his not being so quite to the same extent.
Appeal allowed. Assessment of damages varied. Each child awarded $1,500.

Taylor v. OConnor

In 1965 the respondent's husband was killed as a result of a car accident for
which the appellant was wholly liable. The respondent claimed damages
under the Fatal Accidents Acts on behalf of herself (aged 52) and her daughter
(aged 18). The husband who was 53 at the time of his death had been a
partner in a successful firm of architects. His life expectation at the date of his
death was 18 years and that of the respondent was 21 years. His income, after
deduction of tax, would have been 7,500 per annum up to the date of his
retirement if he retired at 65 (although no provision as to retirement was made
in the partnership deed). Under the partnership deed, he was required to leave
some part of his income in the partnership as working capital; at the time of his
death this amounted to 10,000 and during the rest of his working life as a
partner he would have left 1,500 per annum in the firm. In assessing damages,
the trial judge, holding that he might have continued as a full partner beyond
the age of 65 or might have continued as a consultant, ruled that the husband
would have continued to enjoy a net spendable income of 6,000 per annum
for the rest of his life. The dependency of the respondent and the daughter was
estimated at 4,000 from which 250 was deducted in respect of the
accelerated benefit from the savings of 10,000 (erroneously taken to be
13,000); the dependency for the purposes of the award of damages being
reckoned at 3,750 per annum. The judge increased the proposed multiplier
from ten to 12 to make allowance for inflation. To the resulting sum (45,000) the
judge added 9,000 as the present value of 18,000 (the product of 1,500 left
in the firm for each of 12 years). The Court of Appeal refused to disturb the trial
judge's award. On appeal against quantum:
Held There were no grounds for interfering with the amount of damages
awarded by the trial judge. The prospect of inflation is not a valid reason for
increasing a multiplier. In assessing the effect of the incidence of tax on an
award of damages, any private income of the recipient should be ignored.

Mitchell v. Mulholland (No.2)- COA (not HL)***

In respect of the post-trial financial loss the court should adopt the traditional
method of multiplier and multiplicand; the actuarial method was not sufficiently
precise since it was based on the 'average' man and paid insufficient regard to
the particular plaintiff assuming that he must be considered as 'average' unless
and until the defendant showed that he was not; although actuarial
calculations might well be used as a means of cross-checking calculations and
arriving at the appropriate multiplier to be used, they could not be used as the
primary basis of assessment for the reason that of necessity they treated future

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probabilities as certainties; the same reasoning also applied to the discount of 2
per cent for contingencies; such contingencies could not be allowed for by
ignoring the individual case and making an arbitrary subtraction.
Evidence as to 'productivity inflation' was in principle admissible as a relevant
factor in assessing damages for the loss of ability to earn; evidence of an
increase in productivity in future years which would have increased the
defendant's earning power must, however, be directed to the particular
industry and the particular firm in which the defendant was employed; the
evidence in the present case, relating solely to projected increases in national
prosperity, was much too speculative and was accordingly inadmissible.

TAXATION

The question here is, in assessing damages for the gains that the C has been
prevented from making by the defendants tort or breach of contract, do the
courts deduct income tax (incorporation tax for company) that the C would
have paid on those gains?

British Transport Commissioner v. Gourley

When assessing damages, in actions for personal injuries or wrongful dismissal,

for the loss of actual or prospective earnings, allowance must be made for any
incidence of income tax (including surtax) on the earnings, where the
damages themselves are not taxable in the hands of the recipient.
The HL held that in an action for damages for personal injuries tortiously
inflicted, the calculation of the Ps damages in respect of his loss of earnings,
both past and prospective at the time of the trial, must take into account the
tax which would have been payable upon them as if he had been working for
those earnings.
In considering the assessment of damages for loss of earnings, the rate of tax to
be taken must be the effective rate of income tax and, if necessary, surtax,
which would have been applicable to the sums in question if they had been
earned.
The principle decided in the present case, viz that allowance must be made for
the plaintiff's tax liability when assessing damages for loss of earnings, is decided
only in relation to damages in actions for personal injuries or for wrongful
dismissal.
Yet the principle seems to be of general application where damages are
assessed for loss of earnings which, if earned, would have been taxable. The
damages in the present case were themselves not taxable in the hands of the
recipient.

The Gourley principle has seen been applied to actions for wrongful dismissal,
for trepass and conversion and for libel, and it can therefore be regarded as a

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general principle in assessing compensatory damages. It should be noted that
Gourley emphasised that the deduction should apply only if the damages
themselves were not to be taxed otherwise the C would be taxed twice. This
principle has been criticised and the Canadian Courts have refused to follow it.

Diamond v. Campbell Jones

In July, 1956, the defendants agreed to sell to the plaintiff for 6,000 a leasehold
interest for a term expiring in the year 2003 in property in Mayfair comprising a
basement and ground floor and four upper floors. The agreement was
expressed to be subject to and with the benefit of a contract for the grant of a
new lease, which contract required works of conversion of the property into
ground floor office accommodation and residential maisonettes above to be
carried out by the lessee. The agreement also stated that the permitted use for
the purposes of the Town and Country Planning Act, 1947, was that stated in a
letter by which permission was given for office use of the ground floor until a
date in 1970 and from which it appeared that permission for multiple residential
use of the rest of the premises would probably be given if requested. The
defendants repudiated the contract and an inquiry as to damages was
ordered. The plaintiff contended that the proper measure of damages was the
profit that he would have realised if he had converted the upper floors into
maisonettes and the ground floor into offices, and if he had disposed of the
premises when so converted. The plaintiff was a dealer in real property, but it
was neither pleaded nor shown in evidence that the defendants knew what his
occupation was or that he intended to carry out a conversion of the premises.
The market value of the property at the date of the breach of contract, without
having been converted, substantially exceeded 6,000.
Held (i) the plaintiff was not entitled to damages measured by reference to
the profit obtainable by converting the property, because special
circumstances were necessary to justify imputing to a vendor of land
knowledge that the purchaser intended to use it in a particular manner, and
the mere facts that the property was ripe for conversion and that everyone
recognised this were not sufficient to impute to the defendants knowledge that
the plaintiff intended to convert the property for profit; therefore, the damages
should be assessed by reference to the difference between the purchase price
and the market value at the date of the breach of contract.
(ii) since the damages recovered by the plaintiff were liable to attract income
tax as part of the profits or gains of his business, he should be awarded a gross
sum in damages (equal to the excess of the market value over the purchase
price at the relevant date), not merely a net sum equivalent to the profit
remaining after deduction of income tax.

Lyndale Fashion Manufacturers v. Rich

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The employee was engaged by the employers as a travelling salesman on a
commission basis and taxed under Sch D on his profits. His employment was
terminated and he was held to be entitled to damages for wrongful dismissal. In
the tax year in which the dismissal occurred the employee's total earnings
amounted to 1,343. He was awarded damages of 495 less tax against the
employers in respect of loss of earnings. The employee contended that the tax
to be deducted was to be calculated by dividing the tax that would be
payable on his total assumed income rateably between the amount actually
earned and the assumed additional income of 495.
Held (i) The employee's method was incorrect. The amount of tax to be
deducted from the damages was the difference between the actual tax paid
on the employee's earnings and the tax which he would have paid on the
assumed total income.
(ii) Any expenses which might have been incurred in earning the additional
income and the earned income relief exclusively referable to the assumed
additional income should be set against that assumed income only and not
against the total income.

INTEREST

Part 8.72 (3) of the CPR set out that you are to plead interest.
Section 3. of the Law Reform (Miscellaneous Provisions) Act (1955)

In any proceedings tried in any Court of Record for Power of the recovery of
any debt or damages, the Court may, if it thinks fit, order that there shall be
included in the sum for which judgment is given interest at such rate as it thinks
fit on the whole or any part of the debt or damage for the whole or any part of
the period between the date when the cause of action arose and the date of
the judgment:
Provided that nothing in this section-
(a) shall authorize the giving of interest upon interest; or
(b) shall apply in relation to any debt upon which interest is payable as of right
whether by virtue
of any agreement or otherwise; or
(c) shall affect the damages recoverable for the dishonor of a bill of exchange.

This section gives the court a discretion:

1)as to whether to award interest or not;
2)as to what rate;
3) on what part of the damages; and for what period between the date
when the cause of action arose and the judgment.

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Section 51 of the Judicature (SC) Act provides that:

"Every judgement debt shall in the SC carry interest in the rate of six per centum
or such other rate per annum as the Minister may by Order from time to time
prescribe in lieu thereof, from the time of entering up the judgement, until the
same shall be satisfied, and such interest may be levied under a writ of
execution on such judgement."
London, Chatham and Dover Railway Co v Southeastern Railway Co
Lord Herschell LC, ruled to give interest from the date of the action. He
stated the principle which he thought should apply in a consideration of
whether or not interest should be allowed thus:
I think that when money is owing from one party to another and that
other is driven to have recourse to legal proceedings in order to recover
the amount due to him, the party who is wrongfully withholding the money
from the other ought not in justice to benefit by having that money in his
possession and enjoying the use of it, when the money ought to be in the
possession of the other party who is entitled to its use.

Jefford and Another v Gee

It was a case in negligence in assessing damages the trial judge awarded

interest at 61/2% on the general damages from the date of the accident but
refused to order interest on the special damages. Both sides appealed. The
defendants contended that no interest at all should be awarded on the
general damages and certainly not on the award for loss of future earnings,
and if indeed such interest were to be awarded, the rate of 61/2% was too
high, and further the period was too long. The successful plaintiff complained
that the rate of interest was too low and that he was entitled to interest on the
special damages. Further, section 22 of the (UK) Administration of Justice Act
1969 had amended the Law Reform Act of 1934 by making the award of
interest compulsory unless there were special reasons for not awarding it.
Held:
(a) general damages awarded for pain and suffering and loss of amenities
should bear interest from the date of the service of the writ to the date
of trial;
(b) interest should be at the rate available for short-term investment for
money in court [then 6%];
(c) general damages awarded for loss of future earnings should bear no
interest;
(d) interest on special damages should be at one half the rate awarded
for general damages [3%] and should run from the date of the
accident to trial.
Lord Denning said Interest should not be awarded as compensation for the
damage done. It should only be awarded to a plaintiff for being kept out of the
money which ought to have been paid to him.
Interest should be awarded to a plaintiff not as compensation but for

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 being kept out of money which ought to have been paid to him.

On special damages interest should, ordinarily, be awarded on the total

sum of the special damages from the date of the accident until the
date of trial, at half the appropriate rate of interest allowed on the
general damages. Any recoupment of special damage from some
other quarter should be taken into account in awarding the interest.

On damages for loss of future earnings no interest should be awarded

because a plaintiff will not have kept out of any money but on the
contrary will have received it in advance.

On damages for pain and suffering and loss of amenities interest should
be awarded, at the appropriate rate, from the date of service of the writ
to the date of trial.

The appropriate rate of interest on general damages should be the rate

allowed on money in court placed on short term investment account
under the Administration of Justice Act 1965, ss 6, 7, and the Supreme
Court Fund Rules 1927, as amended, and the rate should be taken as
the average rate so allowed over the period for which the interest is
awarded.

To carry out the 1934 Act as amended, the court should itemise the
damages; and the judgment should state the rate of interest and the
period for which it is awarded. The interest should be stated as a gross
sum without deducting tax.

Payment into court should be made as before without regard to interest.

If a plaintiff recovers more than the payment in, apart from interest, he
will get his costs and if he recovers no more than the payment in, apart
from interest, he will not get his costs from the date of the payment in
and will have to pay the defendants costs. In either case a plaintiff will
get the appropriate award of interest irrespective of the payment in; but
if he takes the money out of court in satisfaction of his claim, he will not
be entitled to interest under the 1934 Act as there will have been no
judgment.

In exceptional cases, ie, of great delay, the court may diminish or increase
the award of interest or alter the period for which it is allowed.

Wright v British Rly Board:

Lord Diplock
"My lords, claims for damages in respect of personal injuries constitute a high
proportion of civil actions that are started in the courts of this country. If all of
them proceeded to trial, the administration of civil justice would break down;
what prevents this is that a high proportion of them are settled before they
reach the expensive and time-consuming stage of trial and an even higher

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proportion of claims, particularly the less serious ones, are settled before the
stage is reached of issuing and serving a writ. This is only possible if there is some
reasonable degree of predictability about the sum of money that would be
likely to be recovered if the action proceeded to trial and the plaintiff
succeeded in establishing liability."

The COA in the Central Soya of Jamaica case made reference to this quote
then said: every word of that general statement is an applicable in Jamaica
as it is in England.
Central Soya of Jamaica Ltd. V Freeman
This was an appeal against quantum of damages awarded on personal injuries
claim for damages for negligence in the Supreme Court. Damages were
awarded to the respondent under various headings. Special damages
amounting to $12,739 consisted of inter alia:
(a) loss of earnings for 50 weeks $50 per week and
(b) loss of earnings for 41/2 years $40 per week.
An award of $4,000 was made for the respondent's handicap in the labour
market. General damages were awarded for pain, loss of amenities and
temporary impotence in the global sum of $50,000.00. There followed an award
of interest at 4% per annum on the special damages from October 10, 1978
and at 8% on the general damages as from December 21, 1979.
One of the grounds for appeal was that the learned trial judge failed to
properly exercise his discretion on the award of interest. Held: No logical
distinction can properly be drawn between the method of awarding interest on
special damages and on general damages.
(a) interest be awarded on special damages at the rate of 3% from the
date of the accident to the date of judgement;

(b) interest be awarded on general damages at the rate of 3% from the

date of the service of the writ to the date of judgement.
On the literal interpretation of section 3 of the Law Reform Act a trial judge has
an unfettered discretion to determine whether or not to grant any interest at all,
and if he decide at what rate the interest should be, and on what part of the
judgement, and within the parameters of the section from what time the
interest should run.
The question as to how the trial judge ought to exercise his discretion in the
matter of the award of interest reached the Court of Appeal in England in the
case of Jefford and Another v Gee Following this case the Jamaican courts
began to apply the 6% on general damages and 3% on special damages
formula for the award of interest in negligence cases. This 6% rate of interest
accorded with the rate applicable in Jamaica for interest on judgment debts
(though this was perhaps done unconsciously).
The objective of section 51 of The Judicature (SC) Act (which speaks to the
award of 6% interest on judgment debts) was to introduce a method into the
law where the exercise for effecting a change in the interest rate would be
rendered much easier by obviating the necessity of having to resort to
amending legislation on every occasion for this purpose. Parliament in Jamaica
as late as 1971 legislated a method for fixing interest rates for judgement debts

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and it must be assumed that no recommendation or no sufficiently persuasive
recommendation has been made to the Minister since 1971 to increase the 6%
rate. Accordingly the Court said that 6% was a good starting point. However
the defendant should not have to pay a higher rate of interest than a
successful plaintiff can get on a judgement debt (no justification for a higher
rate of interest before judgment than after judgment).

Where a plaintiff has been guilty of unreasonable delay in bringing his action to
trial, it may be appropriate for the trial judge to make a corresponding
reduction in the period for which interest is given.

Trinidad Transport Enterprises Ltd v DeSouza

Trial judge ordered interest on special damages but refused it on general

damages.
Held: there was nothing to justify interference with the exercise of the learned
judges discretion in awarding interest as it was not established that he gave no
weight or insufficient weight to considerations that ought to have weighed with
him, or that he was influenced by considerations which ought not to have
weighed or weighed so much with him.

Heerlal v Hack Bros

One of the grounds of appeal was that the judge failed to exercise his
discretion judicially by refusing to award the appellant interest
Held: That this is not a fitting case for the award of interest on damages
because the appellant is adequately compensated by a substantial award of
damages.
(The discretionary nature of the award of interest in seen in Jamaica)
Telephone v

Barrymore Hill &Tisha Ann Daley.

The original trial judge had awarded interest on general damages at the
interest rate of 5%. However on appeal counsel argued that based upon
judgment of Court of Appeal in Central Soya of Jamaica Limited v Freeman the
rate of interest should be 3%. Court accepted this and reduced the rate to 3%
interest on Special Damages and General Damages. The Court in its judgment
though agreeing with the 3% illustrated the discretionary nature of the award
of interest by stating:
we are in agreement with counsel for the appellant that no specific
circumstances are disclosed in the transcript which called for an exercise
of discretion by the learned judge to award interest in excess of the 3%
stated in the guidelines.

Jamaican case of Marsha Page v Malcolm Campbell

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 Justice Sykes assessed special damages at 6% from February 21 st 2001 ( the
date of the accident) to date of the hearing of assessment of damages and
general damages at 6% from April 8th 2002 (date of the service of the writ) to
June 29th 2004.

Dyer & Dyer v Stone 27 JLR - Court of Appeal held trial judge erred in
calculating interest on the award under the Fatal Accidents Act from the date
of the service of the writ, since in fatal accident damages, no interest is
awarded on the post-trial dependency amount. See from this case that the
interest rate for fatal accidents is 3%.

INFLATION

Mohammed Ibrahim Hosein v. Camacho

The appellant was severely injured in a road accident for,which the deceased
was responsible. The only issue to be decided at the trial was the quantum of
damages to which the appellant was entitled. The trial judge awarded the
appellant (inter alia) $5,000 general damages for his injuries, pain, loss of
amenity and disability; he described this as the 'conventional sum' for such an
award. Also, he refused a claim for an item of special damages, namely the
cost to the appellant of legal representation at the inquest into the death of
the deceased. The appellant appealed against the amount of the award. On
the questions of the proper award for general damages and the cost of legal
representation at the inquest,
Held - It would be difficult to find a sufficient number of cases with similar
characteristics to form the basis of a 'conventional sum' for damages for injuries,
pain, loss of amenity and disability; however, the courts must strive to follow the
trend of judicial awards in similar cases and to take account of any fall in the
value of money; in the circumstances of the present case and with due regard
to awards in other cases the award for general damages would be increased
to $8,000.

Johnson v. Sterling Products Ltd

In assessing the appropriate award for loss of amenities the court should
properly consider awards in other cases and also take into account the
appellant's age and the effect of inflation.

Young v. Percival

In December 1970 the deceased, then aged 29 and married with two children,
was killed in a motor accident for which the defendant admitted liability. At the
time of the accident the deceased was employed by a travel firm as area
sales manager at a salary of 2,000 per annum gross, 1,615 per annum net,

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with an expense allowance of 15 a week. In an action for damages brought
by his widow under the Fatal Accidents Acts 1846 to 1959 and the Law Reform
(Miscellaneous Provisions) Act 1934, evidence was given that in future years
there would have been increases in his remuneration had he continued with
the same employer. That evidence took into account increases attributable not
only to the deceased's advancement in status and experience, but also to an
anticipated decrease in the value of the pound in consequence of inflation.
Held Estimates or forecasts given in evidence of future earnings increases
referable solely to the anticipation of future inflation were to be excluded in
assessing damages

Lim Poo Choo v. Camdem & Islington Health Authority

Although the risk of future inflation could be taken into account in exceptional
cases, as a rule of practice damages were to be assessed without regard to
the risk of future inflation, and only if that assessment did not result in fair
compensation was the award to be increased. In particular, it was not unjust
that a plaintiff was placed in the same position as others who had to rely on
capital for their future support, having regard to the fact that the plaintiff would
receive a capital sum available for investment, which, it was to be assumed,
would cope with future inflation. Although the judge ought not to have allowed
for inflation in the multiplier, and ought to have fixed the multiplier by reference
to a pre-accident, rather than a post-accident, expectation of working life, the
multiplier in fact used accorded with the plaintiff's pre-accident expectation of
working life, and his award would therefore not be disturbed on that account.

Mitchell v. Mulholland

Although it was proper to increase an award of damages to take account of a

reduction in the value of money at the date of the award, an award which was
proper at the date when it was made was not to be increased merely because
the sum awarded might have decreased in real value in five or ten years time;
once the award had been made the plaintiff must protect himself from a
subsequent fall in value of money by prudent investment.
Evidence as to 'productivity inflation' was in principle admissible as a relevant
factor in assessing damages for the loss of ability to earn; evidence of an
increase in productivity in future years which would have increased the
defendant's earning power must, however, be directed to the particular
industry and the particular firm in which the defendant was employed; the
evidence in the present case, relating solely to projected increases in national
prosperity, was much too speculative and was accordingly inadmissible.

MITIGATION

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The principal meaning of the term mitigation concerns the avoiding of
consequences of a wrong whether tort or breach of contract.
(i) The plaintiff must take all reasonable steps to mitigate the loss to him
consequent upon the defendants wrong and cannot recover
damages for any such loss which he could thus have avoided but
has failed, through unreasonable action or inaction, to avoid, i.e. the
plaintiff cannot recover for avoidable loss.

(ii) Where the plaintiff does take reasonable steps to mitigate the loss to
him consequent upon the Ds wrong, he can recover for loss incurred
in so doing; this is so even though the resulting damage is in the event
greater than it would have been had the mitigating steps not been
taken, i.e. the plaintiff can recover for loss incurred in reasonable
attempts to avoid loss.

(iii) Where the plaintiff does take steps to mitigate the loss to him
consequent upon the Ds wrong and these steps are successful, the
D is entitled to the benefit accruing from the Ps action and is liable
only for the loss as lessened; this is so even though the P would not
have been debarred under the first rule from recovering the whole
loss, which would have accrued in the absence of his successful
mitigating steps, by reason of these steps not being ones which were
required by him under the first rule, i.e. the plaintiff cannot recover for
avoided loss.

The two subsidiary or residual meanings of mitigation

1. In certain torts, particularly those of defamation, false imprisonment and
malicious prosecution, the measure of damages may be affected by
the conduct, character and circumstances of both P and D. These
factors are said to go in aggravation or in mitigation of the damage.
Thus, the damage is most likely aggravated, and the damages
correspondingly increased by the Ds bad motives or wilfulness. This
meaning of the term mitigation simply deals with particular items which
go to show the injury is not as great as would prima facie appear. It is
important to look and see what the actual injury is quite apart from
subsequent steps taken by the P.

2. Where the P suing the D in respect of his failure to perform a contract is

also himself in breach of contract, the loss thereby accruing to the D
may in certain cases go in mitigation or reduction of the amount which
the P can recover in his action.

The rule as to avoidable loss

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The damage resulting from a wrongful act, whether tort or breach of contract,
may be lessened by well-advised action on the part of the P. In such
circumstances the law requires him to take all reasonable steps to mitigate the
loss consequent on the Ds wrong, and refuses to allow him damages in respect
of any part of the loss which is due to his neglect to take such steps.

British Westinghouse v. Underground Railway

Viscount Haldane LC said: The fundamental basis is thus compensation for

pecuniary loss naturally flowing from the breach; but this first principle is
qualified by a second, which imposes on a P the duty of taking all reasonable
steps to mitigate the loss consequent on the breach, and debars him from
claiming any part of the damage which is due to his neglect to take such
steps.

- The principle applies equally to non-pecuniary loss and to tort e.g. a P

who is injured and fails to take reasonable steps to obtain medical aid
and thereby fails to cut down the pain and suffering resulting from the
injury.

- The duty is not actionable or one which is owed to anyone by the P.

He cannot owe a duty to himself; the position is similar to that of a P
whose damages are reduced b/c of contributory negligence. Pearson
LJ in Darbishire v. Warran said the P is not entitled to charge the D by
way of damages with any sum than that which he reasonably needs to
expend for the purpose of making good the losshe is fully entitled to
be as extravagant as he pleases but not at the expense of the
defendant.

- The onus of proof is on the D. If he fails to show that the P ought

reasonably to have taken certain mitigating steps, then the normal
measure will apply.

White and Carter v. McGregor

P, advertising agents, contracted with the sales manager of the D garage for 3
years. The D on hearing of the contract wrote at once to the Ps to cancel it but
the P refused, displayed the advertisements in accordance with the agreement
and sued for the contract price. HELD:- HL by a majority said that the Ps were
entitled to carry out the contract and claim in debt for the price, and were not
obliged to accept the repudiation and sue for damages. H/v Lord Reid gave 2
qualifications, i.e.:
i. If it can be shown that a person has no legitimate interest, financial or
otherwise, in performing the contract rather than claiming damages
he ought not be allowed to saddle the other party with the
additional burden with no benefit to himself;

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 ii. If a party has no interest to enforce a stipulation, he cannot in
general enforce it.

These qualifications have been relied on and used to distinguish White and
Carter in subsequent cases.

Selvanayagam v. University of the West Indies

PC held that where a physically injured P had refused to undergo medical

treatment to alleviate his injury, the burden was on him to prove that he had
acted reasonably, a burden which he was found to have discharged.
- This case seems to have gone against the established authorities and
subsequent decisions of the COA in England. McGregor in his book
McGregor on Damages submit that this decision was reached per
incuriam.

Payzu v. Saunders: Bankes and Scrutton LJ said that the question of mitigation
of damage is a question of fact. The effect of this is that once a court of first
instance has decided that there has been or has not been a failure to mitigate,
it is difficult to persuade an appellate court to come to a different view.

Geest plc v. Lansiquot (READ CASE)

On the assessment of damages for personal injuries, the onus of proof on the
issue of mitigation falls on the defendant and, if the defendant intends to
contend that a plaintiff has failed to act reasonably to mitigate his or her
damage, notice of such contention should be clearly given to the plaintiff in
sufficient time before the hearing to enable the plaintiff to prepare to meet it (if
there are no pleadings, notice should be given by letter).

Need to mitigate before contractual breach

A P need not take any steps to mitigate until a wrong has been committed
against him. Where a party to a contract repudiates it, if the other party does
not accept it there is no breach of contract, and the contract subsists for the
benefit of both parties and no need to mitigate arises. H/v if the repudiation is
accepted this results in an anticipatory breach of contract in respect of which
suit can be brought at once for damages and although the measure of
damages is till prima facie assessed as from the date when the D ought to have
performed the contract, this amount is subject to being cut down if the P fails to
mitigate his acceptance of the repudiation. This is best illustrated by sale of
goods cases. The same principle applies mutatis mutandis where it is the buyer
who has repudiated.

Shindler v. Northern Raincoat Co (law as it relates to employment contracts)

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The D company in the course of the P employment by them under a ten-year
agreement, wrongfully repudiated the contract by informing the P that they
would not continue to require his services as from an apparently unspecified
later date, but only removed him from office at an extraordinary general
meeting of the company some months after this repudiation. HELD:- the P had
no duty to mitigate by accepting the alternative offers of employment b/s the
Ds wrongful repudiation and their removal of him from office b/c during this
period there had been no breach; the P had not accepted the repudiation
and the defendants had a locus poenitentiae.

Need to mitigate by discontinuing contractual performance

A P need not take steps to mitigate loss even after the Ds performance of the
contract which he has repudiated falls due by accepting the repudiation and
suing for damages. He may instead, where he can do so w/o the Ds
assistance, perform his side of the contract and claim in debt for the contract
price.
- Even if this involves incurring expense in the performance of the contract
which, in face of the Ds repudiation, is rendered useless, the P is not
required to minimise the loss by accepting the repudiation and suing for
damages.

Standard of conduct P must attain when assessing what steps should have been
taken by him

P must act reasonably and the standard of reasonableness is not high in view of
the fact that the D is an admitted wrongdoer. Whether the P has acted
reasonably in every case is a question of fact and not law.

a) A P need not risk his money too far.

b) A P need not risk his person too far in the hands of surgeons
(Selvanayagam case)
c) A P need not have an abortion to end an unwanted pregnancy.
d) A P need not destroy or sacrifice rights or property of his own.
e) A P need not take steps to recover compensation for his loss from parties
who, in addition to the D, are liable to him.
f) A P need not prejudice his commercial reputation.

g) A P will not be prejudiced by his financial inability to take steps in

mitigation:

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 Clippens Oil Co v. Edinburgh & District Water Trustees per Lord Collins In
my opinion the wrongdoer must take his victim talem qualem, and if the
position of the latter is aggravated b/c he is w/o means of mitigating it,
so much the worse for the wrongdoer, who has got to be answerable for
the consequences flowing from his tortuous act.
In the famous case on remoteness of damage, Liesbosch Dredger v. Edison,
Lord Wright cited this dictum of Lord Collins and concluded that it was not in
point since it was dealing not with the measure of damage, but with the
victims duty to minimise damage, which is quite a different matter.
- He casts no doubt on its correctness (accepted it) and it has
been applied in subsequent decisions.

Lagden v. OConnor [2004] HL

An impecunious innocent claimant could recover damages to cover higher

rates charged by a credit hire company where he had no alternative but to
use its services to enable him to obtain a replacement car while his own vehicle
was being repaired. As elsewhere a negligent driver had to take his victim as
he found him. Common fairness required that if an innocent claimant could not
afford to pay car hire charges, so that left to himself he would be unable to
obtain a replacement car to meet the need created by the negligent driver,
then the damages payable under that head of loss should include the
reasonable costs of a credit hire company. It meant that in measuring the loss
suffered by an impecunious plaintiff by the loss of use of his own car the law
would recognise that, because of his lack of financial means, the timely
provision of a replacement vehicle for him cost more than it would in the case
of his more affluent neighbour. When considering what was meant by
impecunious, it had to be borne in mind that lack of financial means was,
almost always, a question of priorities. In the context of the instant case, what it
signified was the inability to pay car hire charges without making sacrifices the
claimant could not reasonably be expected to make.

Where the P has taken precautions against injury by way of insurance, pension,
or the like, and is then injured by the wrong of the D, the damages recoverable
will not be diminished by the amount of insurance, pension or other such
moneys. (Bradburn v. GWR)

Exceptions to the doctrine

- Where the cause of action is trespass and the facts are that D is in
occupation of the Ps land and the P sues for damages in trespass, P has
no obligation to mitigate. At all times P will be asserting his or her right to

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 the recovery of the land. The law in that context attaches no obligation
to mitigate.
- Equally if P sues in detinue and requires the recovery of the res , the P on
the face of it has no obligation to mitigate by obtaining another res.
However, we may have to consider what the P uses the thing for eg if its
to get to work, we must consider the daily cost of his transport less the
cost of operating the vehicle.

UNIFORMIATY OF AWARDS

Tyson v. Jugmohan

Both parties to a motor car collision denied liability, each alleging that the other
was overtaking a car in front of him and was on the incorrect side of the road,
and each claiming to be either stationary or moving very slowly on the extreme
left of the road. Negligence was apparent on the part of the driver of the
overtaking car. The plaintiff failed to call any witnesses. Despite evidence given
on the defendant's behalf, the court found in favour of the plaintiff on the basis
of the measurements and the other evidence.
The plaintiff was about fifty years of age at the time of the accident, and a
barrister-at-law. He was rendered unconscious by the collision, and fully
regained consciousness about a half an hour after. He was discharged from
the General Hospital the same day after an X-ray had been taken. Two days
later he was admitted to the Community Hospital and some 5 days after that
he was operated on to correct a fracture of the cup of his right pelvis, and
consequent dislocation of the thigh bone. Over a three-month period he
progressed gradually from walking on crutches to using a single stick, which he
used for about 18 months. Medical opinion indicated fixed flexion deformity in
the right leg of some 45 with a 30 per cent permanent partial disability. Possible
further deterioration could give rise to arthritis.
Held: (i) that the defendant was negligent and wholly liable;
(ii) that general damages would be awarded in conformity with discernible
trends of awards in Trinidad and Tobago and other Caribbean countries,
though in discerning such trends attention need not be restricted to cases in
which the nature of the injuries and gravity of the consequences suffered are
closely similar to the claimant's. Consideration would be given to the nature of
the injury, which while not affecting the plaintiff's immediate future earnings but
only interrupting his practice, did curtail his enjoyment of life.

White v. Morris

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In the early morning of 9 March 1962, as the plaintiff's car and the defendant's
motor lorry passed each other, the right sides of the vehicles came into contact
with the result that the plaintiff's right arm which was resting on the sill of the
driver's window was severed six inches below the shoulder by an iron loop on
the defendant's lorry. In an action brought by the plaintiff to recover damages
for personal injuries and damage to his car, he alleged that the defendant's
negligence was the sole cause of the accident. At the spot where the
accident occurred the road inclines upwards to form a sort of hump and
there are metal studs along the centre line of the road. The plaintiff's case was
that the defendant came over the hump on the plaintiff's side of the road to
such an extent that the evasive action which he took by pulling to the extreme
left side of the road could not prevent the defendant's lorry from touching his
vehicle. The defendant alleged that the plaintiff's negligence caused the
accident in that he was driving too fast and driving with one hand. Prior to the
accident the plaintiff was a communications officer earning US $139.88 per
week. He was not able to resume this occupation and was subsequently
employed as a switchboard attendant at the same salary. He lost all
reasonable prospects of promotion which were open to him of becoming chief
communications officer or manager. The trial judge found the defendant solely
to blame for the accident and awarded the plaintiff $25,000 as general
damages. On the question as to the legal principles with respect to factors to
be taken into account in assessing damages.

Held: (i) the legal principles as to the factors to be taken into account in
assessing damages are, generally speaking, the same as those applicable in
England, and it is proper when making such assessment that regard should be
paid to the range of awards in comparable cases determined in the same
jurisdiction or in neighbouring localities where similar social, economic and
industrial conditions exist. Regard should also be paid to the alterations in the
value of money from time to time;
(ii) the plaintiff's injuries which were of considerable gravity were attended with
much pain and suffering. They resulted in his becoming a one-armed man, and
so caused him to lose not only all reasonable prospects of promotion open to
him in his field of employment but also handicapped him in regard to future
employment in the labour market. On account of the loss of amenities which
the plaintiff suffered as a result of the injuries and their adverse effect on his
pecuniary prospects an award of $25,000 general damages would be
appropriate.
Judgment for plaintiff.

Yarde & Subryan v. McWatt

In the assessment of damages in an action for personal injuries efforts should be

made by courts to achieve some degree of uniformity in awards in respect of
injuries of a particular type. In so doing, regard must be paid to awards by
courts in near locality and to countries where similar social economic and
industrial conditions exist.

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Heeralall v. Hack Bros

The plaintiff was knocked down by a lorry on the public road and as the result
suffered an amputation of his left leg above the knee. In the High Court he
sued the defendants who were employer and employee/driver respectively
and recovered a total of $26,544 general and special damages. However, on
appeal both general and special damages were attacked as being erroneous
and unrealistic as an estimate of the damages suffered.
The trial judge made no award of a conventional sum in respect of the loss of
the plaintiff's leg and in endeavouring to calculate loss of prospective earnings
found that the plaintiff earned a livelihood from three main sources of income,
(i) $2,300 per annum from rice farming; (ii) $624 per annum from market
gardening; and (iii) $873.60 per annum from the sale of milk from four cows. He
also found that the injury forced plaintiff to sell his four cows for $2,000 and that
this amount had been put into the savings bank where it was earning interest.
He thereby concluded that the plaintiff would have suffered hardly any loss
of income from the sale of milk, which caused him completely to ignore item
(iii) above when computing the plaintiff's future loss in arriving at the figure of
$17,544 by the use of a multiplier of 12. The judge merely divided the sum of the
annual incomes from rice farming and market gardening by two because he
estimated the plaintiff would only be able to earn, after payment of
disbursements, about one-half of what he previously earned.
On appeal it was contended (i) that there was no justification for the judge's
conclusion that plaintiff would earn only one-half of what he previously did; (ii)
that there was error in excluding from the computation plaintiff's annual
earnings from the sale of milk for the reason that he suffered hardly any loss,
but rather was in a position to gain income for the future by way of the interest
derived from investing the $2,000; (iii) that the multiplier of 12 was too low and
that 16 would have been a more realistic figure; (iv) that the court failed to
award plaintiff any conventional sum in respect of the loss of the leg; (v) that
the court failed to exercise its discretion judicially when it refused to award the
appellant interest under the law.
Held: (i) that the judge misapprehended the facts when he concluded that
with paid help the appellant could have mitigated his loss and earned annually
roughly one-half of his pre-accident income from the kitchen garden and rice
cultivation;
(ii) that there was ample justification for this conclusion and for the course taken
by the trial judge. The matter was a difficult one and he did the best he could in
the circumstances. It was essential to determine what was plaintiff's immediate
loss of earnings from the pursuits in which he was engaged, ie, those that were
adversely affected by the accident if his prospective loss of earnings was to be
reasonably calculated. To find this loss, it was necessary to determine what he
was capable of earning in his semi-disabled state and deduct such earnings
from that which he earned in his pre-accident condition. It was necessary to do
this as a preliminary to converting such loss of earning capacity into a capital
sum by using an appropriate multiplier;

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(iii) that it is not an unreasonable assumption to make that plaintiff's earnings as
from now would not measure up to the standard of his pre-accident earnings. It
is estimated he would earn at the rate of one-half of what he had been
earning at the date of the accident;
(iv) that it was wrong in principle to leave the milk sales money out of the count
for the reason the trial judge did so. The test is not if he could have invested this
sum, but whether it was so unreasonable not to do so that the plaintiff should
not get the benefit of the loss from this source of income;
(v) that to regularise the position it was necessary for the judge to bring into
computation the $2,000 for which the cows were sold when calculating
plaintiff's prospective loss of income, because if plaintiff were to be allowed to
have his earnings from the cows aggregated with the other two annual
earnings, and yet be allowed to retain the proceeds without bringing them into
account, that would infringe the equitable principle of equality of burden and
benefit;
(vi) that the trial judge was not shown to err when he found the appropriate
multiplier to be 12. His finding should not be disturbed as that figure is not unduly
low in all the circumstances;
(vii) that there is no established discernible pattern or trend of awards of
compensation under the head pain, suffering and loss of amenities in the
reported cases in Guyana;
(viii) that the award of $3,500 for pain, suffering and loss of amenities was much
too low and the scale goes down heavily against it; but where it is thought fit to
make a comparison with a view to ascertaining a conventional figure to be
awarded as damages it is preferable to leave it to the sound judgment and
good sense of proportion of the trial judge assisted by counsel, to determine in
every case as it arises, subject to appellate review, the proper adjustment to be
made in using an award in a comparable English case. In the use of
comparable cases as a guide to assessment, the reduction in the value or
purchasing power of the pound sterling or of the dollar must be taken into
account. The proposition that the failure to employ one of the two
conventional methods is, per se, an error in principle, cannot be accepted,
although in the majority of cases a judge will and probably ought to use one or
the other;
(ix) that the trial judge erred in not making the basic and necessary award of a
conventional sum for loss of the plaintiff's leg. This lies at the root of an
assessment for general damages, and now Guyana is more or less committed
to a policy of socialist orientation, it would not be entirely right to regard English
decisions in the light they were formerly held, viz, as the sole pointers to a
possible result when comparing conventional awards for damages in personal
injuries cases;
(x) that this is not a fitting case for the award of interest on damages because
the appellant is adequately compensated by a substantial award of damages.

Associated Industries Ltd v. Kumar Ragnauth

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The respondent was an active sportsman who also enjoyed outdoor pursuits
such as hunting and fishing. At the age of 36 years, 5 months, he was injured in
a motor accident. He suffered extensive deep lacerations on the scalp,
multiple abrasions and bruises all over his body, fractures of the right tibia, fibula
and humerus. He spent three months in hospital and underwent three
operations. He suffered extensive and lasting pain and, even after discharge
from hospital, suffered pain in the right hand, right leg and both hips (from
which bone had been grafted). His right leg was 3/4 inch shorter than his left,
and he was no longer able to participate in sport or other outdoor activities
which he had previously enjoyed. The trial judge awarded the respondent
$17,000 for pain, suffering and loss of amenities. On appeal.
Held, allowing the appeal as to quantum of damages, the award for pain,
suffering and loss of amenities was inordinately high by comparison with other
awards, even allowing for the constant decline in the spending power of
money; $12,000 would be a fair and reasonable assessment.

FATAL ACCIDENTS

Khan v. Khan

In an action brought by the respondent in her capacity as the administratrix of

her deceased husband's estate, and in her own capacity as a result of a motor
accident in which her husband died, the trial judge found that the deceased
was guilty of contributory negligence to the extent of three-fifths, and awarded
damages against the appellant, the driver of the motor vehicle on that basis.
Having awarded a sum in respect of loss of expectation of life and another for
funeral expenses the judge based his award in respect of the loss to the
deceased's family on the deceased's annual income.
Held: (i) that an appellate court will not interfere with the trial judge's finding
and apportionment of contributory negligence unless he has misdirected
himself, or has failed to take some vital matter into account;
(ii) that an award of damages made under Accidental Death and Workmen's
Injuries (Compensation) Ordinance, Cap 112 [G] must be calculated on the
financial loss or loss of support which the dependants of the deceased have
suffered as a result of the accident, and any sums awarded under the Law
Reform (Miscellaneous) Provisions Ordinance, Cap 4 [G] must be deducted
therefrom.

Mykoo v. Katee

The respondent successfully sued the appellant for damages for the death of
the respondent's son in a motor accident. She sued in her capacity both as a
dependant and as administratrix of her son's estate.
A motor cycle ridden by the deceased collided with a vehicle driven by the
appellant. The evidence of the sole eye-witness for the plaintiff-respondent was
rejected. The trial judge, however, accepted the evidence of the investigating

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officer. The trial judge rejected the appellant's version of the accident but
preferred the respondent's case that the appellant's vehicle emerged from his
private premises on the public road at a time when it was unsafe to do so.
On appeal the appellant disputed liability and contended that the trial judge
erred in not taking into account the sum of $1,000 awarded the respondent as
administratrix for the deceased's loss of expectation of life in awarding the sum
of $5,000 by way of compensation under the Compensation for Injuries
Ordinance.
Held: (i) that in the circumstances liability was a question of fact, and the
findings of fact made by the trial judge would not be disturbed;
(ii) that the judge had failed to consider the principle that prima facie an
award of damages to a plaintiff in respect of dependency on a deceased
should be reduced by the amount awarded by reason of the death of the
same deceased.

Jaichand Persaud v Vincent Lewis

The deceased contributed a substantial part of his wages partly for the sole use
and benefit of his mother, and partly towards the education of his brothers and
sisters. On a claim under the Accidental Deaths and Workmen's Injuries
(Compensation) Ordinance, Cap 112 [G] for the payment of compensation to
the deceased's dependants, the trial judge made an award in respect of the
brothers and sisters of the deceased.
Held: on appeal (CUMMINGS JA, dissenting), that the brothers and sisters of the
deceased were not dependants within the meaning of the Ordinance (s 4),
and that the trial judge ought to have determined the extent of the mother's
dependency, and to have made an award on that basis only.
Appeal allowed.

Hubah v. Ramjass

Following the death of her husband in a road accident on 23 March 1952, the
plaintiff as his widow received the proceeds of an insurance policy on his life
amounting to $2, 500, a gratuity of $2, 400 from the deceased's employers, and
from the Widows and Orphans Pensions fund to which the deceased was a
contributor she received $80 per month for herself and $100 per month for their
two children, Diana Lyn, born on 28 March 1948 and Carol, born on 20 August
1952. The plaintiff remarried on 16 May 1958, whereupon her allowance from
the Fund of $80 per month ceased. At the date of his death the deceased was
thirty five years of age and earning $200 per month out of which he contributed
$134 to his home. It was anticipated that but for his death the deceased would
have continued in his employment and earned a salary of $7, 200 per annum in
approximately twenty years. During the lifetime of the deceased the plaintiff
worked for $180 per month which had increased to $240 at the time of her

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remarriage when she stopped working. Her second husband, since her
remarriage, adequately maintaining maintaining and supporting her and her
two children.
Held: in assessing the damages the following factors factors should be taken
into account:
(i) so far as the plaintiff was concerned: (a) that her dependency on the
deceased terminated on her remarriage on 16 May 1958; (b) the financial
benefits that had accrued to her on husband's death; (c) income tax
deductions;
(ii) so far as the children were concerned: (a) that the plaintiff's second
husband was under no legal obligation to support them and may, with
impunity, cease supporting them at any time; (b) the financial benefits that
accrued to them upon the death of the deceased; and (c) income tax
deductions. Order accordingly.

TORTS AFFECTING CHATTELS

DAMAGES TO AND DESTRUCTION OF CHATTLE

Personal damage or destruction of goods may result from a large variety of

different torts of which trespass is the oldest and negligence the most prolific.
Most of the cases in which the measure of damage has been worked out have
involved damage or destruction of ships, generally by collision. The principles
expounded in these cases are of universal application.
- The normal measure of damage is the amount by which the value of the
goods damaged has been diminished. In ship collision cases, this has
invariably been taken as the reasonable cost of repair.

The cost of repair is appropriate only if in the circumstances it is reasonable for

the plaintiff to effect the repair; it might be cheaper to buy a replacement on
the market and sell the damaged goods for what they will fetch. (Compare
Darbishire & OGrady)

Darbishire v. Warren

Harman LJ said where it can be proved that the cost of repair greatly exceeds
the value in the market of the damaged article this would be an exception to
the rule.
The Ps second hand shooting brake, which was reliable, suited his needs, and
had been kept in good repair by him, was damaged by the D, and the P
repaired it at a cost of $192 despite advice from the repair garage and his
insurers that repairs would be uneconomic. There was evidence that it would

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have been difficult to get a replacement of the particular model in the second-
hand market, but that similar shooting brakes could be had for $80 to $100. The
COA held that in the circumstances the P, in having the car repaired at a cost
exceeding its market value instead of trying to replace it with a comparable
car at the market price, had failed to mitigate his loss and was entitled to
recover not the cost of repair, but only the lower market value. The COA
pointed out that the P may have acted reasonably as far as he was concerned
in having the car repaired but the relevant question was whether he had acted
reasonably as between himself and the D in view of his duty to mitigate, a
question which had to be considered from the point of view of a businessman.

OGrady v. Westminister Scaffolding Ltd

Repair costs were allowed in excess of the cars market value. The car was the
apple of the owners eye, and had, through special work done on it, become a
unique article thus making the standard market value irrelevant.

Where the ship which has been damaged is not profit-earning either because
she is used for utility by public bodies or because she is used for pleasure, and
the P does not hire a substitute during the period of repair, difficulties arise with
regard to the head of damage representing loss of use. In The Greta Holme,
the argument put forward by the D was that in such a case the P has not
suffered any pecuniary loss, beyond out of pocket expenses by being deprived
of the ship during the time required for repair and that he ought therefore to be
limited to damages representing out-of-pocket expenses, such as costs of
repair and wages still paid to the crew. The HL corrected the error and
decided that in such a case general damages might be recovered.
In this case the damaged ship was a dredger and the damage resulted in a
delay in the dredging, the Ps not having gone to the cost of substituting a new
dredger while the damaged one was repaired. The HL in reversing the COA
decision, allowed general damages for the loss of use while the dredger was
undergoing repairs. Lord Watson said that the principles applied by the COA
would entail the result that a corporation who invest large sums of money in a
dredger, or in any other article which they intend to use, and do use
continuously, for purposes which are of interest to them, and protect the
pocket of the ratepayers, although they are not productive of private gain,
can recover from the wrongdoer the cost of repairing injury to these articles,
but are not entitled to recover damages from the person who deprives them of
the use of such articles w/o lawful cause.

This decision was followed by the HL in The Mediana. In both cases the P was
the Mersey Docks and Harbour Board, a public authority deriving its funds from
the rates and not entitled to make or distribute profits. The damaged ship in this
case was a lightship.
In this case the place of the damaged lightship was taken during her repair by
another lightship belonging to the P harbour board, the substituted ship being
kept expressly for the purpose of such an emergency. The HL held that the Ps

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were entitled to substantial damages for the loss of the use of the damaged
lightship. Lord Halsbury LC said: Where by the wrongful act of one man
something belonging to another is either itself so injured as not to be capable
of being used or is taken away so that it cannot be used at all, that of itself is a
ground for damages.
- It is to be noted that these two cases did not help in establishing how the
measure of such damages is to be calculated.
The amount of damages awarded under this head, where there is no substitute
ship hired and no stand-by ship kept available, is generally to be calculated on
the basis of interest upon the capital value of the damaged ship at the time of
the collision, this value being ascertained by taking the original cost and
deducting depreciation.

The S.S. Chekiang

The HL refused to disturb the registrars award in which damages for loss of use
of an Admiralty light cruiser had been calculated on the basis of 5% interest
upon the capital value of the ship at the time of the collision, this value being
ascertained by taking the original costs and deducting depreciation.

Where a stand-by ship has been kept available by the P, the calculation is
made upon the value of the stand-by itself.

The S.S. Susquehanna

The HL held wrong the registrars award for the loss of use of an Admiralty oil
tanker, which he had based upon the tankers commercial value if properly
chartered, b/c the tanker would not have been hired out during the period of
repair. Interest on the stand-by ship form the correct calculation, h/v, only if the
stand-by ship is in fact substituted for the damaged ship.

Birmingham Corporation v. Sowsberry

In applying these rules evolved in the cases concerning ships to the assessment
of the proper award in respect of damage to a city corporations omnibus,
Geoffrey Lane J assumed that the earlier authorities had established two
possible methods of calculation of damages, which he stated as the interest
on capital and depreciation method exemplified in The Chekiang and the
method of cost of maintenance and operation. He then proceeded to apply
the latter since the standing cost basis of calculation did not suffer from
possible fluctuations in capital value and interest rates, and provided a
reasonably stable basis for calculation as fair to both sides as could be
devised. The P were entitled to the aggregate daily standing cost charge for

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the days when the use of the vehicle was lost, there being no suggestion that
the daily rate was other than an accurate estimate of the cost of running an
omnibus by a reasonably efficient organisation.

Bruce v. Rammarine

A motor lorry which the appellant bought for $4,000 in October 1967, was
involved in a collision in February 1968. The appellant repaired the vehicle at a
cost of $2,810 which was included in her claim for $3,985 as special damages.
Accepting an unreliable estimate of $1,000 as the value of the vehicle at the
time of the collision the trial judge awarded the appellant $640 which, when
calculated on the basis of a salvage value of $600, included special damages
of $400 for loss of the lorry. The trial judge held that the lorry was not
economically repairable.
Held: (i) that the rule of liability in common law cases is the same as in admiralty
cases and damages are therefore awarded on the principle of restitutio in
integrum, that is to say, to put a plaintiff in the same position as though the
damage had not happened.
(ii) that the cost of a complete repair of all damage is recoverable by the
appellant, notwithstanding that the result of a complete repair may be to
render the vehicle more valuable than it was before the collision.
(iii) that if the charges are extravagant they must be reduced, but for
necessary repairs the owner has a right to be reimbursed; and the evidence of
skilful persons who saw the vehicle after the collision is the best proof of that
necessity.
Appeal allowed. Case remitted to High Court for a fresh assessment of special
damages.

DETINUE AND CONVERSION

General and Finance Facilities Ltd v. Cook Cars (Rowford) Ltd

A successful plaintiff in an action in detinue who obtains judgment for the return
of the detained chattel or recovery of its value and damages for its detention is
entitled to have assessed separately:
(i) The value of the chattel at the date of the assessment; and
(ii) The damages sustained by the plaintiff up to that date.

Galloway v. McLaughlin

Sachs v. Miklos

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In 1940 a bailor arranged with a bailee that the latter should gratuitously store
his furniture in her house. In 1944 the bailee, wishing to terminate the bailment,
wrote to the bailor at his supposed address, requesting him to remove the
furniture. Receiving no reply, she wrote once more stating her intention, failing
instructions, to sell the furniture, and again received no reply. Attempts were
also made by telephone to get in touch with the bailor, but without result. In
July, 1944, the furniture was sold by auction and realised 13. In an action for
detinue and conversion, commenced in 1946, the bailor claimed the current
value of the furniture, which was assessed at 115.
HELD:- the bailee was not an agent of necessity and in selling the furniture was
guilty of conversion. While the measure of damages for both conversion and
detinue was usually the value of the goods at the date when judgment was
given, nevertheless, if the bailor knew or ought to have known at an earlier
date that the conversion had taken place or was about to take place and
took no immediate steps to recover the goods, the measure of damages was
the value of the goods at the date of his knowledge or supposed knowledge
and not the date when judgment was given.

Rosenthal v. Alderton

In an action of detinue it was contended by the defendants (i) that the value
of the goods detained and not subsequently returned should be assessed as at
the date when the cause of action arose, i.e. when the defendants had
refused the plaintiff's claim for the goods; (ii) that the value of such goods as
had been wrongfully sold by the defendants should be assessed as at the date
of sale.
HELD:- The value of the goods detained and not subsequently returned should
be assessed as at the date of judgment or verdict.
- The same principle applied whether the goods had been converted
(provided that the plaintiff was not aware of the conversion at the time)
or whether the defendants failed to re-deliver them for some other
reason. The defendants could not improve their position by reason of
their own misconduct.

Munro v. Wilmot

By permission of the licensee the owner of a motor car left it for nearly three
years in the yard of an inn. The licensee found that it was causing difficulty to
drivers of vehicles using the yard, particularly ambulances of the St John's
Ambulance Corps, to whom a garage on the premises was let. Being unable to
trace the owner, he had repairs carried out on the car at a cost of 85, and
then had it sold by auction for 105, less commission amounting to 5. The value
of the car was 120 at the date of judgment.
HELD:- The doctrine of agency of necessity could be applied to goods stored in
premises, if at all, only in a case of emergency necessitating the disposal of the

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goods which did not exist here, and, accordingly, the licensee was liable to the
owner for detinue and conversion of the car.
- The measure of damages for the conversion and in detinue was the
value of the car at the date of judgment less any increase in value
attributable to the expenditure of money on it by the licensee, and
judgment would, therefore, be given for the plaintiff for 35.

Strand Electronic Co v. Brosford Entertainment Ltd

The defendants, who were negotiating for the sale of a theatre to BT, Ltd
having allowed that company to go into possession before completion, the
plaintiffs, in the ordinary course of their business, hired to BT Ltd protable switch-
boards to control the stage lighting of the theatre. BT Ltd being unable to
complete the purchase of the theatre informed the plaintiffs that they were
willing to return the equipment to them, but were prevented from doing so by
the defendants who had taken possession of the theatre. The plaintiffs
demanded from the defendants the return of the equipment, but the
defendants retained possession of it. On the question of damages:
HELD:- The plaintiffs were entitled to a sum representing a reasonable charge
for the hire of the goods from the date on which the defendants took
possession of them to the date of the return of the goods.
Where a defendant has detained and used a chattel of the plaintiff which the
plaintiff, as part of his business, hires out to users, the measure of damages in an
action for the detinue of the chattel is a reasonable sum for the hire of the
chattel during the period of the detention.

The Arpad (Read caseconfusingclarify)

Whether an action in respect of the non-delivery or short delivery of goods is in
tort (for conversion) or in contract (for breach of the contract of carriage)
circumstances peculiar to the plaintiff, such o & a sub-contract entered into by
him and not communicated to the defendant) must be excluded from
consideration in assessing damages although in a proper case such a sub-
contract might be used as evidence of value. The matter to be ascertained is
the value of the goods at the date of the non-delivery or short delivery, and so
a sub-contract which the plaintiff has made at a date far removed from that of
the non-delivery or short delivery must be ignored in assessing the damages. If
there is a market at the time when the goods should be delivered in which
goods of a kind fit to implement the contract can be bought and sold, the
measure of damages is the value of the goods ascertained by the market price
of identically similar goods. Where there is no such market, the value must be
otherwise ascertained, and the price at which the plaintiff has sold them a
substantial time before the non-delivery or short delivery is not evidence of their
value at the time of the breach.

The Winkfield

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Wilson v. Lombark
The plaintiff, a motor car dealer, bought car for 470 from a vendor who had
no title in it to sell. The car needed repair, and the plaintiff left it at a garage,
where he had had dealings for many years and where he had monthly credit
terms. The repairs were completed at a cost of 27 14s, and the car was placed
on the forecourt of the garage. While the car was there a representative of the
defendants, thinking that they had legal title to the car, took it away. The
defendants, who in fact had no legal title to the car, although there had been
a purported sale to them, subsequently discovered in whom the legal title was
vested and delivered the car to the true owner. In an action by the plaintiff for
trespass by the defendants,
HELD:- Notwithstanding that the defendants had delivered the car to the true
owner, they were liable in trespass to the plaintiff, who was thus entitled to
recover in damages the full value of the car (470) together with the cost of the
repairs, for in the circumstances the plaintiff had not lost possession of the car
while it was at the garage, nor had the garage acquired a lien on it in view of
the course of dealings between the garage and the plaintiff.

DAMAGES IN CONTRACT

Anglia Television Ltd v. Reed [1971] 3 All ER 690

The claimants with the intention of mounting the film production of a play,
sought to engage the defendant for the main part. For the purposes of the
production they incurred expenditures to the extent of some $2,750 including
fees for a director, designer, stage manager and supporting artists. The
contract between the claimants and the defendant was made but a few days
later he repudiated. In an action for breach of contract, the claimants did not
claim profits that the play would have made since they conceded that these
could not be ascertained. They sought instead to recover the $2,750
expenditure in organising the production. The COA affirmed the lower courts
judgment awarding the full $2,750.
- This may be viewed as the award of the reliance loss to claimants who
could not directly prove their expectation loss.
- Many of the expenses recovered were pre-contractual
Lord Denning:
If the plaintiff claims the wasted expenditure, he is not entitled to the
expenditure incurred after the contract was concluded. He can claim
also the expenditure incurred before the contract, provided it was such
as would reasonably be in the contemplation of the parties as likely to
be wasted if the contract was broken.

CC Films (London) Ltd v. Impact Quadrant Films Ltd [1984] 3 All ER 29

The defendants had there guaranteed a licence to the claimants to exploit

three films and the claimants had paid the agreed consideration of $12,000 for

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that licence. By the contract the defendants were to send to the claimants
video tapes of the films and were to insure them. In breach of contract the
defendants sent the video tapes by ordinary post and uninsured and they were
lost. The defendants were also in breach of contract in failing to deliver
replacement tapes. The claimants could not prove any loss of profits and
instead claimed damages in respect of the expenses of $12,000. Hutchinson J
held that they could recover those damages.
the plaintiff has an unfettered choice; it is not only where he
establishes by evidence that he cannot prove loss of profit or that such
loss of profit as he can prove is small that he is permitted to frame his
claim as one for wasted expenditureI consider that those cases
(Culliname & Anglia) are authority for the proposition that a plaintiff may
always frame his claim in the alternative way if he chooses.
Where the claimant claims reliance damages, the burden of proving that he
has made a bad bargain, that is, that he would not have recouped his
expenses if the contract had been performed is on the defendant.

- (The reliance interest bows to the expectation interest.)

Lloyd v. Stanbury [1971] 2 All ER 267

Pre-contractual expenditure was recovered and Brightman J said that this

should be so, so long as the costs were of performing an act required to be
done by the contract.

CONTRACTS FOR SALE OF LAND

Bain v. Fothergill (1874) LR 7 HL 158

Upon a contract for the sale and purchase of a real estate, if the vendor,
without fraud, is incapable of making a good title, the proposing purchaser is
not entitled to recover compensation in damages for the loss of his bargain.
Per LORD CHELMSFORD:--The rule laid down in Flureau v.Thornhill as to the limits
within which damages may be recovered upon the breach of a contract for
the sale of real estate, must be taken to be without exception. If a person
enters into a contract for the sale of real estate, knowing that he has no title to
it, nor any means of acquiring it, the purchaser cannot, in an action for breach
of the contract, recover damages beyond the expenses he has incurred. Any
other damages must be the subject of an action for deceit.
Per LORD HATHERLEY:--A contract for the sale of real estate is very different from
a contract for the sale of a chattel. In the former the purchaser knows that
there must, with all the complications of our law, be an uncertainty as to
making out a good title; in the latter the vendor must know what his right to the
chattel is.

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Keen v. Mear [1920] 2 Ch 57**

The mere employment of an estate agent by an owner to dispose of a house

confers no authority to make a contract; the agent is solely employed to find
some one to negotiate with the owner; but, if the agent is definitely instructed
to sell at a certain price, those instructions involve authority to make a binding
contract and to sign an agreement.
The law of England as to the sale of land being so complicated, it may not be
right in such cases to charge a vendor for being unable to carry out his
contract. But here the contract was entered into by Samuel Mear recklessly
and without regard to whether he could or could not carry it out. This case is
different from Bain v. Fothergill. I am satisfied that Samuel Mear acted in
perfect good faith, that he considered the price satisfactory, and that he did
his best to induce his brother to complete the sale. In these circumstances the
case falls within the rule in Flureau v. Thornhill and Bain v. Fothergill. The plaintiff
is not entitled to damages for loss of bargain nor is he, in my opinion, entitled
either (a) to any part of the costs of this litigation as damages or (b) to any
interest in respect of the balance of purchase money which he placed on
deposit at his bank. He is entitled to (a) interest at 5 per cent. on the deposit of
50l. from December 17, 1918, (b) such costs (if any) as he may have been put
to in investigating title, and (c) a sum of 7s. 6d. which he paid to insure the
property on the faith of the contract and before the contract had been
repudiated by Walter Mear.

Malhorta v. Choudry [1979] 1 All ER 186

The plaintiff was one of two partners in a medical practice of which the senior
resided at a property comprising a house and a surgery. On the retirement of
the senior partner the plaintiff agreed to take the defendant into the practice
as junior partner, and the senior partner agreed to sell the property to the
defendant and his wife. The partnership deed, made on 19 May 1972, two
weeks after the contract for the sale of the property, provided, inter alia, that if
the defendant ceased to be a partner, he would offer to sell the house and
surgery to the plaintiff at a fair market price, to be fixed, in the absence of
agreement, by a valuer. On 1 August the property was conveyed to the
defendant and his wife as joint tenants. At the date of the partnership deed the
plaintiff was practising from the surgery at the property and thereafter both he
and the defendant practised from the surgery. The partnership was not
successful, and on 30 March 1973 the plaintiff gave written notice to the
defendant to dissolve it, and also gave notice that he wished to exercise the
option requiring the defendant to offer the property to him for sale. The
defendant asserted that in the events which had happened the option was not
exercisable, and refused to sell the property to the plaintiff. In September 1973
the plaintiff commenced an action claiming, inter alia, specific performance of
the option. By his defence the defendant denied that the plaintiff was entitled
to specific performance and in an affidavit in support stated that the property

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was the home of his wife and himself, that it was vested in both of them, that
the surgery was an integral part of the property, and that on termination of the
partnership he intended to practise from the surgery on his own. On 28 October
1973 a judge held that the plaintiff had properly exercised the option and
ordered specific performance of it. He also ordered that the defendant should
give a valuer access to the property and deliver up all the deeds relating to it,
that there should be an enquiry into title and that the plaintiff should be given
vacant possession of the property. On the defendants appeal, the Court of
Appeal struck out the order for specific performance because the defendants
wife was a joint tenant of the property and might resist an order for sale and
refuse to agree to any conveyance, but the court affirmed the rest of the
judges order. The defendant did not comply with that part of the order which
was affirmed and the plaintiff took out a summons to proceed seeking the title
deeds, access to the property and an enquiry as to title. On 8 November 1974
the defendants wife swore an affidavit in the action stating that she refused to
agree to any sale of the property to the plaintiff. The plaintiff took no further
steps in the action between April 1975 and January 1977 when he issued a
notice of motion asking for damages at common law for breach of the
contract constituted by the option. The defendant admitted breach of the
option but contested the measure of the damages payable. The judge, while
finding that the defendant had not shown any enthusiasm for carrying out the
courts order to show title, also found that there was uncontradicted evidence
that the defendant was unable to make a good title because of his wifes
refusal to consent to a sale and no evidence that he had persuaded her to
refuse to consent, and held that because the defendant was unable to make
a good title the damages recoverable by the plaintiff were limited to the costs
of investigating the title to the property and any costs connected with
obtaining a valuation. The plaintiff appealed seeking substantial damages
under the general principles applicable to a breach of contract:
HELD: the appeal would be allowed because (1) the rule that where a vendor
of land was unable to make a good title the damages recoverable by his
purchaser for breach of the contract were limited to his expenses incurred in
investigating title and did not include damages for the loss of his bargain was
an exceptional rule which only applied if the vendor was unable, through no
default of his own, to carry out his contractual duty to make a good title. To
obtain the benefit of the rule the vendor was required to prove that he had
used his best endeavours to make a good title. Bad faith on his part, even
without actual fraud, was sufficient to exclude the rule, and unwillingness to use
his best endeavours to make a good title constituted bad faith. The statement
that the defendants wife refused to consent to a sale did not indicate that the
defendant tried to persuade her to consent and, in the absence of any other
evidence to that effect it was to be inferred that the defendant had not used
his best endeavours to persuade his wife to agree to the sale and that he was
therefore guilty of bad faith. It followed that the plaintiff was entitled to
substantial damages; (2) damages awarded in substitution for an order for
specific performance of a contract of sale of real property were to be assessed
by reference to the value of the property at the date of the judgment and not
at the date of breach of the contract. However, as there has been delay by

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the plaintiff since 1975 in bringing the proceedings to a conclusion, the date for
valuing the property would be moved back one year from the date of the
judgment in October 1977 to October 1976. Furthermore, since the parties must
have contemplated that if the plaintiff exercised the option, he would use the
surgery for his practice, the damages in substitution for specific performance of
the option should include such loss in the plaintiffs medical practice as had
flowed in the past, or would flow in the future from the defendants failure to sell
the house and surgery to the plaintiff.

Re Daniel, Daniel v. Vassell [1917] 2 Ch. 105

Testator had agreed to sell real property which, with other property, was
subject to one mortgage. After his death the title was accepted by the
purchasers; but the mortgagees refused to release the property sold from their
mortgage, and the executors of the vendor had not enough funds of the
estate for redemption of the mortgage:--
Held: that the liability to the purchasers was not limited to the costs of
investigating the title, but that they were entitled to general damages for loss of
bargain.
In such a case the absence of wilful default and bad faith is immaterial.

Diamond v. Campbell Jones [1960] 1 All ER 583

In July 1956, defendants agreed to sell to plaintiff for 6,000 a leasehold interest
for a term expiring in the year 2003 in property in Mayfair comprising a
basement and ground floor and four upper floors. The agreement was
expressed to be subject to and with the benefit of a contract for the grant of a
new lease, which contract required works of conversion of the property into
ground floor office accommodation and residential maisonettes above to be
carried out by the lessee. The agreement also stated that the permitted use for
the purpose of the Town and Country Planning Act 1947, was that stated in a
letter by which permission was given for office use of the ground floor until a
date in 1970 and from which it appeared that permission for multiple residential
use of the rest of the premises would probably be given if requested.
Defendants repudiated the contract and an inquiry as to damages was
ordered. Plaintiff contended that the proper measure of damages was the
profit that he would have realised if he had converted the upper floors into
maisonettes and the ground floor into offices, and if he had disposed of the
premises when so converted. Plaintiff was a dealer in real property, but it was
neither pleaded nor shown in evidence that defendants knew what his
occupation was or that he intended to carry out a conversion of the premises.
The market value of the property at the date of the breach of contract, without
having been converted, substantially exceeded 6,000:
HELD: (1) plaintiff was not entitled to damages measured by reference to the
profit obtainable by converting the property, because special circumstances
were necessary to justify imputing to a vendor of land knowledge that the
purchaser intended to use it in a particular manner, and the mere facts that the
property was ripe for conversion and that everyone recognised this were not
sufficient to impute to defendants knowledge that plaintiff intended to convert

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the property for profit: therefore, the damages should be assessed by reference
to the difference between the purchase price and the market value at the
date of the breach of contract; (2) since the damages recovered by plaintiff
were liable to attract income tax as part of the profits or gains of his business,
he should be awarded a gross sum in damages (equal to the excess of the
market value over the purchase price at the relevant date), not merely a net
sum equivalent to the profit remaining after deduction of income tax.

Cottril v. Steyning & Littlehampton Building Society [1966] 2 All ER 295

In February 1957, vendors granted to plaintiff an option to purchase a house

and land for 5,000; the option included a term that he should apply for
planning permission and modification of a tree preservation order to permit
alteration of the house and building on the land. At the time when the option
was granted the vendors knew that the purchaser intended to develop the
land. Plaintiff promptly took steps towards obtaining planning permission and
modification of the tree preservation order. He left England, however, for a
month in April 1957, returning on 10 May. The vendors, wrongly as the court
found, treated this as repudiation and resold for 6,250. They were thus in
breach of their contract with plaintiff. Plaintiff who had developed other
properties, effected his developments of land through companies, and he had,
on a former occasion, conveyed a neighbouring property for development to
one of his companies without taking a profit on the sale. The vendors had no
knowledge at the time of the option contract of the method used by plaintiff in
developing land through companies of his intentions in that respect:
HELD: plaintiffs damages for breach of contract should be assessed by
reference to the profits which both parties contemplated that he would make
and which defendants breach of contract had prevented him from making:
accordingly, the market value of the property should be assessed on the
footing that planning permission would be granted and the tree-preservation
order would be modified within six months of plaintiffs return on 10 May 1957,
and that the building and alteration would have been completed within
eighteen months of 10 May 1957, with the consequence that the damages
would be the difference between the market value so estimated and the
expenses of building together with the agreed price of the land.

Johnson v. Agnew [1979] 2 WLR 487 (fixing a flexible date of assessment)

Lord Wilberforce said: If the vendor treats the purchaser as having repudiated
the contract and accepts the repudiation, he cannot thereafter seek specific
performance. This follows from the fact that, the purchaser having repudiated
the contract and his repudiation having been accepted, both parties are
discharged from further performance.
The vendor of land was a claimant in a situation where mortgagees had sold
off the land at a low value subsequent to the date of the breach. The vendor
had initially obtained an order for specific performance but the defendant
purchaser had delayed in complying with the order with the consequence that

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the vendor could not pay off his mortgage and his mortgagee became
entitled to sell of his land. The vendor therefore now sought damages for the
purchasers breach of contract. Having emphasised that damages in lieu of
specific performance and ordinary common law damages should be assessed
on the same basis, Lord Wilberforce went on to say:
The general principle for the assessment of damages is compensatory, i.e. that
the innocent party is to be placed, so far as money can do, in the same
position as if the contract had been performed. Where the contract is one of
sale, this principle normally leads to an assessment of damages as at the date
of breach a principle recognised and embodied in s.51 of the Sale of Goods
Act 1893. But this is not an absolute rule; if to follow it would give rise to injustice,
the court has power to fix such other date as may be appropriate in the
circumstances. In cases where a breach of contract for sale has occurred,
and the innocent party reasonably continues to try to have the contract
completed, it would to me appear more logical and just rather than tie him to
the date of the original breach to assess damages as at the date when
otherwise than by his default the contract is lost.
Accordingly, it was decided that the market value of the land should be
assessed not at the date of the purchasers original breach but rather when the
vendors reasonable attempts to have the contract enforced failed: i.e. when
the mortgagees, as they were entitled to do, contracted to sell the land to
another party hence making it impossible for the claimant vendor to comply
with his side of the contract.

Rose v. Chung 27 WIR 211 (damages out to be assessed at the date of the
assessment)
The plaintiffs were executors of the estate of one MJH who had entered into an
agreement with the first defendant to purchase a lot in a subdivision. The
subdivision was in breach of the Local Improvements Law and contracts for the
sale of lots in it were consequently found by the court to be illegal and
unenforceable. Such contracts were subsequently validated by legislation but
in the meanwhile the land which was the subject of this contract had been
transferred to another purchaser and registered under the Registration of Titles
Act. The plaintiffs brought an action for breach of contract. Counsel for the
plaintiffs, and counsel for the defendants, agreed that the only issue joined was
that on the question of damages. The questions for the court were: How should
damages be assessed? What measure of damages should be applied? What
principles of law are applicable? Plaintiffs counsel relied heavily on the
judgment of Megarry J (as he then was) in the case of Wroth and Others v Tyler,
in which damages for loss of bargain were awarded as at the date of
assessment, and not as at the date of breach of contract, the rationale being
that since the plaintiffs had a proper claim for specific performance, the case
fell within s 2 of the Chancery Amendment Act 1858 (Lord Cairns Act) the
wording of which envisaged damages as a true substitute for specific
performance, and envisages an award at the time the court makes its decision
to award damages in substitution for specific performance.

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What then are the considerations applicable at common law to the measure
of damages for breach by the seller/vendor of a contract for the sale of land?
The general rule, long established by the common law (and first taught to
students of law) is that expressed by Alderson B, in Hadley v Baxendale as
follows:
Where two parties have made a contract which one of them has
broken, the damages which the other party ought to receive in respect
of such breach of contract should be such as may fairly and reasonably
be considered either arising naturally, i.e. according to the usual course
of things, from such breach of contract itself, or such as may reasonably
be supposed to have been in the contemplation of both parties, at the
time they made the contract, as the probable result of the breach of it.
The principle is sometimes referred to as the principle of restitutio in integrum
which applies to both tort and contract. As frequently quoted is the rule stated
by Parke B, in Robinson v Harman, which has been consistently cited with
approval and restated in similar language:
The rule is that the plaintiff is entitled to be placed so far as money can
do it, in the same position as he would have been in had the contract
been performed.
The comment of Megarry J, that the rule at common law requiring damages to
be assessed as at the date of the breach does not seem to be inflexible. The
damages which can be awarded to the plaintiffs now represent a
compensation once and for all for what has been due to Mabel Harvey-
McIntosh up to the date of assessment. Where a contract is not duly
performed on one side, the normal remedy is an action at law to recover
damages for breach of contract; but if this were the only remedy, it would
always be at the option of the defaulting party either to perform his contract or
to pay damages. However, equity has assumed jurisdiction to deprive the
defaulting party of this option and to compel performance where damages
would be inadequate remedy. The facts in this case disclose that the
defendants/vendors chose to breach the contract which had been subsisting
for over ten years, and to ignore the moral if not then legal rights of the
purchaser. An assessment of damages which would profit the defaulting
vendor to breach the agreement at the expense of the purchaser would seem
to me to be inadequate remedy to compensate the purchaser. Damages
assessed on common law principles would be totally inadequate. The case is a
proper case for an order that the contract be specifically performed. The court,
in exercise of its discretion, refuses the order for specific performance, and
awards damages in lieu of such an order.

Rall-Morgan v. Chung 27 WIR 196 (damages out to be assessed at the date of

the breach)
The first defendant entered into an agreement with one IW for the sale of a lot
in a proposed subdivision. IW transferred his interest therein to the plaintiff. The
subdivision was in breach of the Local Improvements Law and contracts for the
sale of land in it were declared by the courts to be illegal and unenforceable.
The contracts were subsequently validated by legislation but the land the

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subject of the agreements with IW had in the meanwhile been transferred to
another purchaser. The plaintiff brought an action for breach of contract. It is
of importance to ascertain whether the plaintiff in this case would be entitled to
specific performance of the original contract, and correlatively, is this a case in
which damages can be awarded in lieu of specific performance?
HELD: I find that the plaintiff was at the date of hearing entitled to specific
performance. At the same time the decree for performance in specie has
always been governed by discretionary considerations. To this extent, therefore,
I accept the submissions by attorney for the defendants that the plaintiff in this
case cannot get specific performance because the land had already been
sold to a third party, which had registered its title by transfer. Specific
performance will not be decreed if it is impossible for the defendant to comply
with the order of the court, whether or not the impossibility arises from the
defendants acts.
In this case the claim is for specific performance and for damages in
substitution therefore. Such a claim envisages equitable damages which are
granted in discretion of the court. Wroth v illustrates one way in which the court
will grant equitable damages. That is on the basis of damages being a 'true
substitute', for damages awarded were measured by reference to the price of
land at the date of judgment rather than at the date of breach. The discretion
of the court was exercised so as to allow it to depart from common law
principles as to the measure of damages. Unless there are special
circumstances dictating otherwise, it is not possible for the Supreme Court of
Jamaica to deviate from the common law principles of the measure of
damages. Damages for the breach of contract for the sale of land, that is, loss
of bargain, are assessed as at the date of breach. The measure of damages at
that date being the difference between the contract price and the market
price at the date of breach. This oft applied principle is in my view, the
measure which is applicable to the instant case. The claim for equitable relief
has not been made any stronger by the submissions made to me on behalf of
the plaintiff, and though I have cogitated whether in the inherent jurisdiction of
the court, equitable damages are available to the plaintiff, I am satisfied that
this is not one of those cases in which such an award could be made. Megarry
J, in Wroth v Tyler reminded that 'a court with equitable jurisdiction will
remember that equity follows the law, and will in general apply common law
rules for the assessment of damages'.

Raineri v. Miles [1980] 2 All ER 145

The vendor agreed to complete the sale of his house to the defendant on 12
July 1977, and on the same day the defendant was to complete the sale of his
house to the plaintiff. The vendor was unable to complete on the due date, as
he was unable to raise sufficient money. The plaintiff had already vacated his
home and was forced to rent accommodation until he obtained vacant
possession of the defendants house. In accordance with the Law Societys
Conditions of Sale 1973, condition 19, the defendant gave the vendor notice to
complete within twenty-eight days and completion took place on 11 August.

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The defendants contract with the plaintiff was completed on that day and the
plaintiff was let into possession. The plaintiff sued and was awarded damages
against the defendant for the expenses incurred due to the delay in
completion. The defendant served the vendor with a third party notice
claiming indemnity. The questions for the court were (i) whether there had
been a breach of contract on 12 July, or within a reasonable time thereafter,
which could be remedied in damages; (ii) whether the service of a notice
pursuant to condition 19 varied the original date for completion so that if
completion took place before the new date, there was no breach of contract,
it being accepted by the parties that if the vendor was in breach of contract
he was liable to indemnify the plaintiff; (iii) whether the reason why the vendors
delayed completion absolved them from liability:
Held Viscount Dilhorne dissenting, (i) the vendor committed a breach of
contract by failing to complete on 12 July. Although a claim for specific
performance of the contract would have been refused on the ground that the
stipulation as to time was not of the essence of the contract, that was no
ground for relieving the vendor or defendant from liability for failure to
complete; (ii) a completion notice could only be served after the specified
completion date had passed, at which time the innocent party had an
accrued right to damages. The court would reject the argument that in serving
a completion notice, the defendant had waived his accrued right; (iii) the
vendors inability to make the necessary financial arrangements and his
deliberate decision not to complete afforded no defence. The vendor was thus
liable to indemnify the defendant for damages paid to the plaintiff.

Gloucester House v. Peskin 4 WIR 182

The respondent agreed to buy land from the appellant company for 30,000.
He intended to form a private company which would construct and operate a
hotel for tourists. The appellant company refused to perform the contract and
in an action for specific performance and damages by the respondent,
specific performance was decreed and the Registrar was directed to assess
damages for delay (3 years). He assessed damages at 114,328 14s.
HELD: Damages should have been based on what would have been the value
of the possession of the premises to the respondent for the period of the delay
and not on the prospective profits of the company which the respondent had
intended to promote.
CROOM-JOHNSON in Phillips v Lamdin said:
Damages for breach of contract for delay, even after the purchase
and the sale of goods has been completed, are always recoverable in a
proper case, provided the plaintiff can prove them.
That principle is that the damages are to be based on what would have been
the value of the possession of the premises to the plaintiff for the period of the
delay, subject always to the general principle that the damages should be
such as may reasonably be said to have naturally arisen in the ordinary course
of things from the delay, or which may reasonably be supposed to have been
in the contemplation of the parties as likely to arise from the breach of
contract. In Jones v Gardiner the plaintiff had purchased two plots of freehold

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land for 620 for the express purpose of erecting dwelling houses to be let in the
ensuing summer and of converting certain buildings into a bungalow, suitable
for persons who might visit the neighbourhood for boating. The delay in
performance of the contract was three months and the claim was for 65 for
loss of rent. In his judgment, BYRNE, J, said:
I think that the plaintiffs are also entitled to reasonable damages,
having regard to the measure as laid down in Jaques v Millar, for the
delay, and for not having vacant possession. I bear in mind that one of
the lots was sold as for a building site, that both were sold as with
possession, and that the purchasers intended to build and have been
delayed in their work by the defendant's default. On the other hand, I
have had regard to the fact that some of the claims in the plaintiffs
particulars are untenable and some exaggerated, while the evidence is
loose and unsatisfactory, and I award 25 by way of damages.
The general principle to which I have referred and which I consider is
applicable to this case covers damages which may reasonably be supposed
to have been in the contemplation of the parties as likely to arise from the
breach of contract. Here the damages awarded are nearly four times the
purchase price of the land. Can it be said that the parties could reasonably
have contemplated that any such loss would have been the consequence of
mere delay in the performance of the contract? In my view, such a proposition
is obviously untenable and the damages awarded cannot be justified on any
such hypothesis. I have arrived at the amount of 15,000 which I consider
reasonable compensation for the loss occasioned by the delay.
The respondent is entitled to damages for loss of profit which he might have
earned if he had had the use of the land for the purpose of his hotel project.
The measure of damages is the value of the possession of the land to him for
that purpose. Where a specific breach of contract is pleaded and proved, but
the claim for damages in respect of that particular breach is misconceived, the
court may yet have regard to the evidence and award such damages as flow
in law from the same breach.

Phillips v. Lamdin [1949] 1 All ER 770

Plaintiff, a naturopath, entered into a contract with defendant for the purchase
of leasehold premises which she required for professional and residential use.
Completion date was fixed as 28 March 1947. In the event of failure to
complete on the agreed date, the contract provided for the payment of
interest by the purchaser on the outstanding purchase-money from the date
fixed for completion to the date of actual completion. The contract also laid
down a time limit of four days, which plaintiff in fact exceeded, for the return by
the purchaser to the vendor of the engrossed assignment after a draft thereof
had been agreed by the vendor. Plaintiff had issued a writ for specific
performance on 15 April 1947, but the matter never came to trial as possession
was granted on 5 June 1947. She now claimed damages including damages
for loss of earnings and expenses caused by the vendors failure to give her
possession on 28 March. She also claimed the reinstatement of an Adam door
removed by the vendor at some time between the date of the contract and

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completion:
HELD: (1) the vendors delay in completion of the contract was wilful and
wrongful, and plaintiff was entitled to recover the damages claimed
calculated from the date when her own default ceased; (2) defendant should
be ordered to reinstate the door, without having an option to pay its value.

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