Breach of Contract and Remedies

Chapter 10

Breach of contract
Breach of contract is the failure to perform
what a party is under a duty to perform.
When this happens, the nonbreaching or
aggrieved party can choose one or more
remedies.
The following are the remedies available to the
aggrieved against the guilty party in the case
of breach of contract.

1. Suit for Rescission

Rescission means cancellation of
contract.When one party breaks the
contract the other party is released
from his obligation.If the aggrieved
party wants to sue the guilty party for
damages for breach of contract he
must sue for recission of the contract.

2. Suit for damages

The aggrieved party may sue for damages in
case of breach of contract.Damages are a
monetary compensation allowed to the aggrieved
party for the loss suffered by him as a result of
breach of contract.The aggrieved party can claim
the following kinds of damages:

Kinds of Damages
a. Ordinary Damages ; These are also called
general damages.When a cotract is broken the
aggrieved party can recover ordinary damages
from the guilty party.Ordinary damages are
usually assessed on the basis of actual loss.
b. Special damages: These damages include
indirect loss which may arise due to breach of
contract.The parties must be aware of the loss
which may arise due to breach of contract.The
notice to this affect must be given otherwise
he is not responsible for special damages.

c. Exemplary Damages:These are awarded to

punish the guilty party for the breach of
contract.These damages have no place in the law
of contract and are not recoverable.
d. Liquated damages: When parties to a contract
fixed the amount of damages for breach of
contract at the time of formation of contract such
damages are called liquidated damages.
e. Nominal Damages:When aggrieved party suffer
no loss the court may reward nominal damages in
recognition of his right

3. Suit upon Quantum merit

The term quantum meruit means payment in
proportion to work done.The right to claim quantum
meruit arises when the orignal contract is
discharged.The aggrieved party may sue for quantum
merit in following cases.
a. When an agreement becomes subsequently void.
b. When contract is divisible.
c. Where something is done without any intention to do
so gratuitously
d. When completion of contract is prevented by other
party.
e. When a divisible work is performed badly.

4. Suit for Specific

performance
In some cases where the damages are not
adequate remedy the court may direct guilty
party to fulfill the contract.The aggrieved party
can sue for specific performance in the
following cases.
a. when compensation is not an adequate
remedy .
b. When it is difficult to calculate actual damages
c. When compensation in money can not be
obtained.

5. Suit for Injunction

Injunction is an order of court
restraining a person from doing
something which he promised not to
do.It is mode of securing specific
performance in the negetive form.