Damages in Contract Law

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3) In relation to the question of damages to be awarded by the courts in relation to a breach of contract, the current position in English law represents something of a dilemma. The courts seem to be pulled, on the one hand, by the need to ensure that obligations entered into in a contract are carried out to the letter, whilst on the other hand avoiding overcompensation of the aggrieved party. The aim of this essay is to look at the approach of the courts in relation to remedies for breach of a contract with specific reference to the awarding of damages. We will ascertain as to how the courts try to ensure that contractual obligations are fulfilled in case of a breach of contract and we will do this with specific reference to the types of damages to be awarded by the courts and try to establish the aim of the law when awarding these damages. We will then, with specific reference to three key cases, look at the compensatory approach of damages and look at the key principles brought about by these cases and the current standing of the law, with the aid of cases and academic writing. In order to tackle this question, we must first define what a contract is. The term contract does not have a solid and/or rigid definition in English law; however, the English legal system, like many other legal systems, is reliant on the Latin “Pacta sunt servanda” – promises are made to be kept; contracts are made to be performed, when looking at the law of contract and contractual obligations. Hence, contract law is a branch of private law based on promises which are made by one party to another and the enforceability of these promises and it is by this assertion that the separation of contract law from that of the law of tort and the law of restitution rests to a large extent. In keeping a contract, it is said that the parties are executing a contract. However, should problems

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