Dingwall v. Burnett [1912] ScotLR 882 (27 June 1912)

Dingwall v. Burnett [1912] ScotLR 882 (27 June 1912)

The £50 clause is a penalty, not liquidated damages. The defender is entitled to retain the deposit-receipt until his claim for damages is constituted. Damages are not limited to the penalty sum but are measured by actual loss, not exceeding the penalty if sued on the penalty clause.

Citation
[1912] ScotLR 882
Parties
Pursuer: David Dingwall; Defender: George Wilson Burnett
Jurisdiction
Scotland
Judgment Date
27 June 1912
Procedural Posture
Civil Appeal / Appeal From Sheriff Substitute to Inner House, Second Division
Outcome
Sheriff-Substitute's interlocutor recalled; case remitted for proof of averments.
Legal Topics
Breach of Contract, Penalty Clauses, Liquidated Damages, Retention of Deposit, Mutual Obligations
Contract Law Breach of Contract Penalty Clauses Liquidated Damages Retention of Deposit Mutual Obligations

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Parties

David Dingwall

Pursuer

George Wilson Burnett

Defender

Procedural Posture

Civil Appeal / Appeal From Sheriff Substitute to Inner House, Second Division

Legal Issues

  1. 1 Whether the £50 clause in the contract is a penalty or liquidated damages
  2. 2 Whether the defender is entitled to retain the deposit-receipt pending determination of damages
  3. 3 Whether damages are limited to the penalty sum or actual loss

Ratio Decidendi

The £50 clause is a penalty, not liquidated damages. The defender is entitled to retain the deposit-receipt until his claim for damages is constituted. Damages are not limited to the penalty sum but are measured by actual loss, not exceeding the penalty if sued on the penalty clause.

Court Disposition

Sheriff-Substitute's interlocutor recalled; case remitted for proof of averments.

Orders

  • Recall of interlocutor appealed against
  • Repel certain pleas-in-law for pursuer