REMDEDIES FOR BREACH OF CONTRACT/CONSEQUENSES OF BREACH OF CONTRACT:

When a party to a contract has broken the contract, the other party may treat the contract as rescinded and he is absolved from all his obligations. Section 64 of contract act deals with the consequences of recession of voidable contract under this section when a person at whose option a contract is voidable rescinds, the other party thereto need not perform any promise therein contained in which he is the promisor. The party rescinded a void-able contract shall, if he has received any benefit there under, from another party to such contract, restore such benefit so far as may be, to the person from whom it was received.

The law on this issue dealt with in two statutes viz., the specific relief act, 1963 and contract act 1872.

The remedies for breach of contract are suit for;

1. SUIT FOR RECESSION: (SEC: 75)

Recession means the setting aside of a contract. The aggrieved party may be allowed by the court to treat the contract at an end, thereby terminating all his liabilities under the contract.

1. SUIT FOR DAMGES OR COMPENSATION: U/sec: 73

Another remedy is available in the case of the breach of contract is damages. Damages may be any of the four types as follow:

1. Ordinary
2. Special
3. Exemplary
4. Nominal

1. SUIT FOR QUANTUM MERUIT: (SEC: 65 & 70)

‘Quantum Meruit’ means ‘as much as merited’ or ‘as much as earned’. This principle of law provides for payment of compensation under certain circumstances to a person who has rendered goods or services to another person, under a contract which could have been fully performed. The aggrieved party can claim reasonable compensation for the act he has done under the contract.

Further, when a contract is discovered to be unenforceable for some technical defect, any person who has done something under the contract is entitled to a reasonable compensation in-spite of the fact that the agreement is void.

1. SUIT FOR SPECIFIC PERFORMANCE:

Courts can, at their discretion, order for the specific performance of a contract according to the provisions of the specific relief in those cases monetary compensation will not be an adequate remedy or actual damages cannot accurately be assessed.

Specific performance of an agreement will not be granted if the agreement has been made without consideration, or the court cannot supervise its execution, or it will be inequitable( i.e. not fair and just), or if the contract is of a personal nature. In contracts for sale of land and rare articles courts generally order for specific performance of the contracts

1. SUIT FOR INJUNCTION:

Where a contract is of a negative , i.e. a party has promised not to do something and he does it and thereby commits a breach of contract, the aggrieved party may, under certain circumstances seek the protection of the court and obtain an injunction, forbidding the party from committing a breach. An injunction is an order of the court instructing a person to refrain from doing some act which has been the subject matter of the contracts. Courts may, at their discretion grant a temporary or a perpetual injunction for a definite period.

1. SUIT FOR RESTITUTION: (SEC: 64 & 65)

Restitution means an act of restoration. According to Alison, a person who has been unjustly enriched at the expense of another must make compensation to the other. The principle of restitution applies in the following circumstances:

1. In case of voidable contract: U/sec: 64
2. In case of contract becoming void
3. In case an agreement is discovered to be void