Morris-Garner and another v One Step (Support) Ltd

Morris-Garner and another v One Step (Support) Ltd

Negotiating damages (Wrotham Park damages) are not available as an alternative to compensatory damages for breach of contract where the claimant’s interest is purely commercial and the loss is quantifiable. Damages must be assessed based on actual financial loss suffered, not on a hypothetical release fee, except where the breach results in the loss of a valuable asset akin to property or intellectual property rights.

Parties
Appellants: Morris-Garner and another; Respondent: One Step (Support) Ltd
Jurisdiction
England and Wales
Judgment Date
18 April 2018
Procedural Posture
Appeal / Judgment of Supreme Court
Outcome
Appeal allowed
Legal Topics
Assessment of Damages, Negotiating Damages, Breach of Contract, Compensatory Damages, Restitution, Injunctions, Restrictive Covenants
Contract Law Equity Damages Assessment of Damages Negotiating Damages Breach of Contract Compensatory Damages Restitution +2 more

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Parties

Morris-Garner and another

Appellants

One Step (Support) Ltd

Respondent

Procedural Posture

Appeal / Judgment of Supreme Court

Legal Issues

  1. 1 In what circumstances can damages for breach of contract be assessed by reference to a hypothetical release fee?
  2. 2 Are negotiating damages (Wrotham Park damages) available for breach of contract where the loss is difficult to quantify?
  3. 3 Was the Court of Appeal correct to uphold the judge’s finding that such damages are available in this case?

Ratio Decidendi

Negotiating damages (Wrotham Park damages) are not available as an alternative to compensatory damages for breach of contract where the claimant’s interest is purely commercial and the loss is quantifiable. Damages must be assessed based on actual financial loss suffered, not on a hypothetical release fee, except where the breach results in the loss of a valuable asset akin to property or intellectual property rights.

Court Disposition

Appeal allowed

Orders

  • Hearing on quantum to proceed; damages to be assessed based on actual financial loss, not hypothetical release fee.
  • Declaration modified: negotiating damages not available in this case; assessment must be compensatory.