Breach of Contract

BREACH OF
CONTRACT
Presented By:
Miss. Mandeep
Mr. Shafiq Ahmad Sahar
Mr. Mahbobullah Rahmani
Mr. Mohammad Asif Nasseri
WHAT IS BREACH OF CONTRACT ?
Contracts are made for being performed. But there are
certain circumstances when one of the parties does not
perform his part of the contract. Non-performance is called
“Breach”.
TYPES OF BREACHES:
Following are the types of Breaches:
 Material breach
 Minor breach
 Anticipatory breach
 Actual breach
ENTITLEMENT OF REMEDIES:
Where a contract is broken the injured party becomes
entitled to one or more following remedies:
 Recession of the contract
 Suit for damages
 Suit upon quantum merit
 Suit for specific performance
 Suit for injunction
Hadley V. Baxendale
• In the year (1854) an attempt was made to define the
extent of this line in the case of Hadley v. Baxendale
Facts
• Hadley used a steam engine to grind corn into cornmeal.
• Engine’s Crankshaft Broke.
• He arranged to have a new shaft made by W. Joyce & Co
• Hadley had to ship broken shaft to w. Joyce & Co. located in
Greenwich wo a replica could be made as replacement.
• Hadley contacted Pickford & Co., the common carrier to ship
the broken shaft to W. Joyce & Co at a cost of £2 sterling and
4 shillings so, Pickford & Co. promised to deliver it the next
day but they failed to deliver it on time.
• It caused the mil to remain close for 5 additional days.
Law suit
• Hadley sued Baxendale for Breach of contract and asked
the court for damages including the profits he lost due to
Baxendale's late delivery.
• The Trail court ordered Baxendale to pay for the lost Profits.
• the jury awarded Hadley damages of £25 (present value
about £2500).
• Baxendale believed that the jury had reached to an unjust
conclusion.
Appeal
• Dissatisfied with the unjust order of the trail court jury,
Baxendal approached the Court of Exchequer Chamber
for a retrial.
• Baxendale appealed, contending that he did not know that
Hadley would suffer any particular damage by reason of
the late delivery
Court of Exchequer Chamber
Trail Court Hadley wins

Must a Party that Breaches a
Contract pay for unforeseeable damages
That result from a breach?
Judgement
• The Court of Exchequer, declined to allow Hadley to recover
lost profits in this case. Baxendale was not liable for the profits.
• The court held that Baxendale could not be held liable for losses
that were unforeseeable. If Hadley had mentioned his special
circumstances in advance, Baxendale could be held liable.
• Hadley had not mentioned that his business would remain
closed due to delay in shipment.
• The mere fact that a part is sending something to be repaired
does not indicate that the party would lose profits it is not
delivered on times.
IDEA Furniture Vs. Distinctive Packaging Company
• Two companies i.e. IDEA Furniture and Distinctive Packaging
• IDEA Furniture company deals with selling the home furnishings
• IDEA Furniture company made oral contract with Distinctive Packaging,
under which Distinctive Packaging is supposed to supply the packing
pouches to IDEA Furniture company.
• Distinctive Packaging made substantial number of packing pouches
following IDEA’S specification.
• Unfortunately, IDEA Furniture sales dropped and refused to take the
delivery of any pouches from Distinctive Packaging.
• Distinctive Packaging sued IDEA Furniture Company for Breach Of
Contract
Question ?
WILL DISTINCTIVE PACKAGING SUCCEED IN ITS BREACH

OF CONTRACT SUIT AGAINST IDEA FURNITURE? EXPLAIN
WHY OR WHY NOT?
Law Suit
• A contract can be either expressed or implied. But, a contract should be enforceable
by law by it’s nature.
• The IDEA Furniture and Distinctive Packaging had Oral Contract, and the contract
was neither complying with necessary formalities with respect to writing, registration
and attestation. If formalities are not carried out, then the contract is not enforceable
by law.
• To wrap up, Distinctive Packaging can’t sue IDEA Furniture for breach of contract,
because the contract is not enforceable by law.
THANK YOU
FOR YOUR ATTENTION

Breach of Contract

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BREACH OF

Trail Court Hadley wins

WILL DISTINCTIVE PACKAGING SUCCEED IN ITS BREACH

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