Table of Contents
Table of Cases xiii
Table of Legislation xxiii
1 Introduction 1
I Method 2
A Fit 3
B Coherence 5
C Morality 7
D Transparency 8
II Conclusion 10
2 Rationales Behind Disgorgement Damages 11
I Introduction 11
II Compensatory Rationale 14
A Compensation for Loss 15
B Substitutive Compensation 18
i Compensation for a Lost Right 18
ii Rights-based Analysis 23
C Conclusion 25
III Deterrent Rationale 26
A Deterrence and the Nature of Contractual Obligation 27
B Deterrence and Efficiency 29
C Deterrence and Substitutability 31
IV Retributive Rationale 32
A The Retributive Aspect of Disgorgement Damages 33
B Digital Pulse and Punishment 35
C 'Cynical Breach' and the Retributive Rationale 40
i The Nature of 'Cynical Breach' 41
ii Reasons Against 'Cynical Breach' as a Criterion 42
iii Reasons For 'Cynical Breach' as a Criterion 43
iv Moving from 'Cynical Breach' to 'Advertent Breach' 44
D Retribution, Desert, Mercy and Bars to Relief 46
V Conclusion 46
3 The Claimant's 'Legitimate Interest' and the Role of Substitutability 48
I Introduction 48
II The 'Legitimate Interest' Test and Substitutability 52
III Policies behind the Primary Duty to Perform Contracts 53
IV The Performance Interest 58
A The Courts' Attitude towards the Performance Interest: Support in Principle 58
B The Courts' Attitude towards the Performance Interest: Failure to Support Claimants in Practice with Remedies? 60
i The Nature of the Expectation Interest 62
ii The Primacy of Expectation Damages 65
V Substitutability and Disgorgement 67
A Disgorgement should be Available when the Subject Matter of the Contract is Not Substitutable 67
B Substitutability - Blake and Cases Following 72
i Blake 72
ii Cases Following Blaket 73
VI Objections to a Substitutability Analysis 77
A Using Availability of Specific Relief as a Peg on which to Hang Availability of Disgorgement Damages 78
B Disgorgement Preferable to and Expanded Definition of Expectation Loss 81
C Disgorgement Damages are not a Fusion Fallacy 84
VII Conclusion: a Different Way of Looking at Disgorgement Damages 86
4 'Second Sale' Cases 87
I Introduction 87
II 'Second Sale' Cases 89
A Contracts for Sale of Land 89
B Contracts for Sale of Goods or Chattels 94
C Contracts for Shares and Stock 99
D Contracts of Services 101
III 'Efficient Breach' and the 'Second Sale' Cases 106
A History of 'Efficient Breach' Theory 107
B The Theory of 'Efficient Breach' 108
C Critiques of 'Efficient Breach' 109
i Third Party Can Acquire Subject Matter of the Contract from Promisee 110
ii Lack of Consideration of Transaction Costs 111
iii Incorrect Factual Predicates 112
iv 'Efficient Breach' is Inefficient 113
v 'Efficient Breach' Does Not Fit with the Law 114
D Conclusion to 'Efficient Breach' 115
IV Conclusion 116
5 'Agency Problem' Cases 118
I Introduction 118
II The 'Agency Problem' and Disgorgement 122
A Disgorgement, the 'Agency Problem' and Fiduciary Duties 122
B Disgorgement, the 'Agency Problem' and Negative Covenants 124
III The Fiduciary 'Bundle of Obligations' 128
IV Criteria for the Award of Disgorgement Damages for Breach of Negative Covenant 132
A Criterion 1: Substitutability 132
B Criterion 2: a Contract Designed to Serve Interests Other than Profit-making 134
i Contracts Involving a Proprietary or Quasi-proprietary Interest 135
ii Contracts Involving National Security or the National Interest 136
iii Contracts Involving Resolution of a Legal Dispute 139
iv Contracts Involving the Protection of Third Party Family Members 143
v Other Contracts Involving the Public Interest 144
V Conclusion 145
6 The Role of 'Restitutionary Damages' 146
I Introduction 146
II What are 'Restitutionary Damages'? 147
III Restitutionary Damages - Still Unhappy 151
IV A Collapsing of Categories 154
V When Should 'Reasonable Fee' Awards be Granted? 161
VI Scope of Disgorgement for 'Skimped Performance' 165
A Skimped Performance and the 'Restoration Cases' 171
i Construction Contracts and Other Cases Involving Building 172
ii Contracts for Restoration of Land 175
B Skimped Performance and Contracts Designed to Reduce Risk 179
VII Conclusion: Choice of Remedy 182
7 Allowances and Bars to Relief 186
I Introduction 186
II Calculating the Account - Causation, Remoteness and Apportionment 188
A The Nature of the Account 188
B Causation and Remoteness 189
C Apportionment 190
III Desert and Mercy 192
A The Nature of 'Desert' 192
B The Nature of 'Mercy' 193
IV Allowances and Disgorgement Damages 196
A Justifications for Allowances 197
B Advertence and Allowances 199
V Operation of Bars to Relief 200
A Delay and Acquiescence 201
B Lack of Clean Hands 207
C Hardship 208
VI Conclusion 210
8 Conclusion 212
Bibliography 215
Index 227
