Remedies in contract: the aims and assessment of damages, causation and remoteness, the duty to mitigate, and the equitable remedies of specific performance and injunction.

A focused answer to the AQA A-Level Law remedies in contract topic, covering the aims and assessment of damages, causation and remoteness, the duty to mitigate, and the equitable remedies of specific performance and injunction.

Generated by Claude Opus 4.810 min answerUpdated 2026-06-02

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Quick answer

The usual remedy for breach of contract is damages, which aim to put the innocent party in the position they would have been in had the contract been properly performed (the expectation interest, Robinson v Harman). Damages can be for loss of bargain, reliance loss or, where loss is hard to prove, nominal damages. Recovery is limited by remoteness: damages are only recoverable if they arise naturally from the breach or were within the parties' reasonable contemplation (the two limbs of Hadley v Baxendale, applied in Victoria Laundry v Newman). The claimant must mitigate their loss (British Westinghouse). Where damages are inadequate, equitable remedies may be granted at the court's discretion: specific performance (an order to perform, not for personal services) and injunctions.

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What this dot point is asking
Damages and their aim
Causation, remoteness and mitigation
Equitable remedies
How remedies are examined

What this dot point is asking

AQA wants you to explain the aim of damages, how they are assessed, the rules on remoteness and the duty to mitigate, and the equitable remedies of specific performance and injunction, applying them to a breach scenario.

Damages and their aim

The court assesses loss of bargain by reference to the difference in value or the cost of cure, and may also award reliance loss (wasted expenditure) where expectation loss is too speculative (Anglia Television v Reed).

Causation, remoteness and mitigation

Equitable remedies

Where damages are an inadequate remedy, the court may grant an equitable remedy at its discretion. Specific performance is an order compelling a party to carry out their contractual obligations; it is used mainly for unique subject matter such as land or rare goods, and is not granted for contracts of personal service (Page One Records v Britton) or where it would require constant supervision (Co-operative Insurance v Argyll Stores). An injunction may be prohibitory (restraining a breach, for example enforcing a valid restraint on competition, Warner Bros v Nelson) or mandatory; like specific performance, it is discretionary and subject to equitable bars such as delay and the conduct of the claimant.

The measure of damages also depends on which interest the claimant chooses to protect. The expectation interest (loss of bargain) looks forward to the profit the contract would have produced. The reliance interest looks backward and compensates wasted expenditure where future profit is too speculative (Anglia Television v Reed, recovering pre-contract preparation costs). A claimant must elect between the two and cannot recover both for the same loss. Damages may also include compensation for distress or disappointment where the very purpose of the contract was enjoyment or peace of mind (Jarvis v Swans Tours, a ruined holiday; Farley v Skinner), but not in ordinary commercial contracts. Liquidated damages clauses fixing the sum in advance are enforceable if they are a genuine pre-estimate of loss, but a penalty clause designed to deter breach is unenforceable (Dunlop v New Garage, refined in Cavendish v Makdessi).

Calculating damages for a failed supply contract

step 1 State the aim

Damages put the claimant in the position they would have occupied had the contract been performed (Robinson v Harman), the expectation measure.

step 2 Identify the recoverable head of loss

Where substitute goods are bought in the market, the loss is the extra cost of cover, reflecting the duty to mitigate (British Westinghouse).

step 3 Do the arithmetic

For 500 units with a contract price of 20 pounds and a market replacement price of 24 pounds: replacement cost is $500 \times \pounds24 = \pounds12{,}000$ and contract cost is $500 \times \pounds20 = \pounds10{,}000$ , so the loss is $\pounds12{,}000 - \pounds10{,}000 = \pounds2{,}000$ .

step 4 Apply remoteness

Check the loss is not too remote under Hadley v Baxendale: the extra cost of cover arises naturally from a failure to deliver, so it is recoverable; any unusual consequential loss needs the second limb and special knowledge.

step 5 State the award

Conclude that the recoverable damages are 2,000 pounds, noting that lost resale profit is not added where the claimant still obtains and resells the goods.

How remedies are examined

Remedies questions reward a clear sequence: state the aim of damages, identify the correct head of loss, apply remoteness and mitigation, and only then consider whether an equitable remedy is needed because damages are inadequate. Quantitative questions expect the figures to be worked through and the duty to mitigate to be reflected in the chosen measure.

Exam-style practice questions

Practice questions written in the style of AQA exam questions on this dot point, with worked answer explainers. The year tag is the paper they imitate, not the source.

AQA 202210 marksFarah contracts to buy 500 units from Greg at 20 pounds each for resale at 30 pounds each. Greg fails to deliver. Farah buys equivalent units elsewhere at 24 pounds each. Calculate Farah's damages and explain how the court assesses them. [10 marks]

Show worked answer →

This requires a worked calculation grounded in the law. Damages aim to put Farah in the position she would have been in had the contract been performed (Robinson v Harman). Her recoverable loss is the extra cost of obtaining substitute goods, reflecting her duty to mitigate by buying in the market (British Westinghouse).

The replacement cost is $500 \times \pounds24 = \pounds12{,}000$ , against the contract cost of $500 \times \pounds20 = \pounds10{,}000$ , so the loss is $\pounds12{,}000 - \pounds10{,}000 = \pounds2{,}000$ . The lost resale profit of $\pounds10$ per unit is not additionally recoverable here because, having obtained the units elsewhere, Farah can still make that profit. Markers reward the correct measure, the mitigation point, and an accurate figure with working shown.

AQA 20189 marksExplain the rules on remoteness of damage and the duty to mitigate in the law of contract. [9 marks]

Show worked answer →

Remoteness limits recovery under Hadley v Baxendale: loss is recoverable if it arises naturally from the breach in the usual course of things (the first limb) or was within the reasonable contemplation of both parties at the time of contracting because of special knowledge (the second limb). Apply Victoria Laundry v Newman: ordinary lost profits were recoverable but the loss of an exceptionally lucrative contract was too remote.

The duty to mitigate requires the claimant to take reasonable steps to reduce loss and bars recovery for losses that could reasonably have been avoided (British Westinghouse). Markers reward both limbs of the test, an applied example, and the point that mitigation only requires reasonable, not perfect, steps.

Related dot points

Sources & how we know this

AQA A-level Law (7162) specification — AQA (2017)