Remedies are the orders that parties may obtain from courts for breach of contract and other contractual disputes. They derive from common law principles, the maxims and rules of equity as well as statute.

Damages are the principal remedy available in breach of contract situations. They represent compensation for loss suffered by the innocent party. Once breach is proved, damages are awarded as of right, even if they are nominal. The purpose of damages for breach of contract is to compensate the plaintiff and to place him or her in the position they should have been in had the contract been performed. The measure or quantum of damages is generally assessed as at the date of breach.

A court may award damages that reflect one or more amounts representing losses that reflect different interests: expectation, reliance, restitution and indemnity. Further, to obtain an award for damages, the plaintiff needs to show that the breach was causally connected to the loss. Contributory negligence by a plaintiff may break the chain of causation between breach by the defendant and the plaintiff’s loss. A plaintiff seeking damages has an obligation to take all reasonable steps to avoid or limit the losses caused by the defendant’s breach.

Importantly, damages payable to a plaintiff may be limited where unforeseen or improbable losses have been incurred and are therefore too remote to attract liability. A defendant in breach will be liable for all losses arising directly from the breach “in the ordinary course of things”. But he or she may also be liable for loss arising from special circumstances of which the defendant had actual knowledge, even though the loss may not have resulted from the “ordinary course of things”.

Where a plaintiff is deprived of a specific amount of money as a result of breach, the defendant may be ordered to pay compensation for loss of the use of the money.

Finally, where a court has the jurisdiction to grant equitable relief, such as to order a decree of specific performance or an injunction, it may in some cases also award equitable damages.

See Damages.

Specific performance is an equitable remedy that is used to enforce a positive contractual obligation. The remedy of specific performance can be applied in two ways: specific performance in “the proper sense” and a court order “analogous to specific performance”. Specific performance can be denied on both jurisdictional and discretionary grounds. Finally, where specific performance is ordered but compliance becomes impossible, a court may award equitable damages instead.

See Specific performance.

An injunction is a remedy that is used to restrain a breach of a negative contractual obligation. Courts may grant injunctions subject to the jurisdictional limitations and some of the discretionary factors that may apply in the granting of specific performance orders. It appears that an injunction may be refused in restrictive covenant cases on the basis that the covenant is inconsistent with a statutory or regulatory provision. See Restrictions on use.

However, most of the case law on injunctions in the context of contract derives from obligations in contracts of personal service. For example, courts are unlikely to grant orders for specific performance in restraint of trade cases, but they may grant injunctions to restrain obligated parties from breaching their negative obligations instead. Whether the outcome of the granting of an injunction will be in effect to force one contracting party to work for the other party will depend on a number of factors that courts take into account.

See Injunctions.

Rectification is an equitable remedy that allows written documents that are intended by the contracting parties to be wholly in writing to be corrected where they do not conform to the rights and liabilities that the parties intended to put in place. Generally, courts require a high standard of proof in rectification cases. This is why evidence for the purposes of a rectification order is generally not precluded by entire agreement clauses or even the parol evidence rule, which says that a court is not allowed to use extrinsic evidence to determine the terms of a written contract. An order for rectification can be refused on discretionary grounds and will not be granted if what is required can be resolved by the application of the rules of contractual construction. There generally needs to be evidence of a common mistake, or in some cases even unilateral mistake, before a rectification order will be made.

See Rectification.

Contracts may be set aside where they have been vitiated by one or other recognised factor such as duress, mistake, misrepresentation, undue influence and unconscionability. See Vitiating factors. This is what rescission involves, since it is an equitable remedy that has the effect of returning the parties to the positions they were in before the contract was formed. Rescission will be available under the general law only where the parties may be restored to their exact pre-contractual positions. Rescission will be available as an equitable remedy even if the parties may be restored only substantially, rather than exactly, to their original positions. It is possible also that a court may order a partial rescission of the contract. Finally, it must be noted that the right to rescind is not absolute, and that certain bars or limitations on rescission exist.

See Rescission.