BetterLawNotes-5 (2)

CONTRACT LAW

Here the court simply orders the defendant to pay the sum that he agreed under the contract to pay. A typical example is where a seller sues the buyer for the price of goods sold and delivered.

‘The law of contract draws a clear distinction between a claim for payment of a debt and a claim for damages for breach of contract . . . a debt is a definite sum of money fixed by the agreement of the parties as payable by one party to the other in return for the performance of a specified obligation by the other party or on the occurrence of some specified event or condition; whereas damages may be claimed from a party who has broken his primary contractual obligation in some way other than by failure to pay such a debt.
The plaintiff who claims payment of a debt need not prove anything beyond the occurrence of the event or condition on the occurrence of which the debt became due. He need prove no loss; the rules as to remoteness of damage and mitigation of loss are irrelevant; and unless the event on which the payment is due is a breach of some other contractual obligation owed by the one party to the other the law on penalties does not apply to the agreed sum.’

Jervis v Harris [1996] Ch 195 (Millett LJ).

White & Carter (Councils) Ltd v McGregor [1961] 3 All ER 1178

W & C agreed to advertise M’s business on litter bins for a period of three years. Almost immediately, M sought to cancel the contract, but W & C insisted it be performed and began to place the advertisements on bins. The contract provided that in the event of any breach by M, all instalments for the three-year period would immediately fall due. M failed to pay the first instalment and W & C brought proceedings claiming the full contract price. The House of Lords held that W & C were entitled to recover the contract price.

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