An indemnity is a remedy ancillary to rescission. It takes the form of a monetary award for expenditure which the representee was obliged to incur as a result of entering into the contract.
C was induced to take a lease of premises for use as a poultry farm by D’s misrepresentation that the premises were in a sanitary condition. In fact, the water supply was contaminated. C’s manager fell ill and C’s poultry died or became worthless. C was also required by the local authority to carry out repair work to the premises. The court held that C could recover by way of indemnity amounts representing rent, rates and repair costs, but not medical bills and loss of profit.
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