Business Law

Running head: BUSINESS LAW
Business Law
Name of the Student
Name of the University
Author Note

1BUSINESS LAW
Issue
The issue is to give advice to Martha regarding her options to recover damages arising
out of the contractual breach by Roger. Martha also needs to be advised regarding her
contract with Chip.
Rule
An award of damages or compensation is the most common remedy for a case of breach
of contract. There are a few different types of damages that an aggrieved party can claim to
recover his loss from a breach of contract.
a) Restitution interest is awarded by a court in order to restore an aggrieved party his
position in which he would have been if the contract was performed as held in
Robinson v Harman1.
b) Reliance interest is awarded to an aggrieved party who is eligible to recover the
expenses made by relying upon the prevalence of the contract. As held in the case of
Anglia Television Ltd v Reed, the significance of the reliance interest is to restore the
position of the aggrieved party in which he would have been if there was no contract
at all2.
c) Expectation interest is awarded to an aggrieved party e where the breaching party e
new about the aggrieved party is intention to draw profit from such contractual deal
that has been subsequently breached as held in the case of Stirling v Poulgrain3.
The interests or damages that are awarded to the aggrieved party is calculated on the
basis of the remoteness of damage that signifies whether the aggrieved party had the remotest
1 Robinson v Harman 1 Ex Rep 850
2 Anglia Television v Reed [1971] 3 All ER 690.
3 Stirling v. Poulgrain [1980] 2 NZLR 402