• In the case of C and P Haulage Co Ltd v Middleton (1993) 3 All ER 94, the licencing of business premises, eviction notice periods, and damages for breach of contract were considered. This case also laid down what the courts would do where a party would be put into a better financial position had he not entered the contract. 

Facts of the Case

  • The company, C, granted a licence to Middleton, D, of a premises to conduct his business. This was on the terms that it was renewable every 6 months, and that the fixtures were not to be removed at the end of the term
  • D incurred expenses whilst refurbishing the premises to suit his business needs
  • 10 weeks before the term had ended, D was unlawfully evicted; he sought damages from the company

Issues

  • Was the D entitled to any monetary compensation for breach of contract, and the improvements he made which became wasted expenditure?
  • Or would the awarding of damages for breach of contract and loss suffered be too much?

Held by Court of Appeal (Civil Division)

  • The company were in breach of contract by wrongfully ejecting Middleton, but he had not suffered loss and so was only entitled to nominal damages.
  • Thus, the appeal was dismissed but Middleton was awarded damages for the wrongful eviction however his claim for refurbishments was not fulfilled as this would put him in a financially better potions than he would have been had the contract not occurred.
  • The reason he was awarded damages for wrongful eviction was due to him not being provided, had such been done this would not have been awarded.

Lord Justice Ackner

Lord Justice Ackner “did not consider that the plaintiff is entitled in an action for damages of breach of contract to ask to be put in the position in which he would have been if the contract had never been made where it is easy to assess what his position would have been if the contract had been performed” [30]

  • Lord Justice Fox, the other judge in this case, agreed

Editorial Comment

  • The lack of remuneration for wasted expenditure in this case indicated that such will not be allowed where it will exceed the expectation loss of the business in question. Where the claimant has entered a bad bargain, the reliance measure may be of his advantage to claim money back however this case shows that it cannot be relied upon always. The later case of Omak Maritime Ltd v Mamola Challenger Shipping Co Ltd (2010) EWHC confirmed that exceeding loss of profit would not be allowed.