Dingwall v Burnett [1912] ScotCS CSIH_2 (27 June 1912)

Dingwall v Burnett [1912] ScotCS CSIH_2 (27 June 1912)

The penalty clause in the contract is not to be construed as liquidated damages but as a penalty; it does not limit the defender's right to recover actual damages for breach, provided they do not exceed the penalty if action is founded on the penalty clause. The pursuer cannot insist on performance or recovery of the deposit-receipt without inquiry into damages, as the unity of the contract must be respected.

Citation
[1912] ScotCS CSIH_2
Parties
Pursuer: Dingwall; Defender: Burnett
Jurisdiction
Scotland
Judgment Date
27 June 1912
Procedural Posture
Civil / Appeal
Outcome
Appeal allowed; interlocutor recalled; case remitted for proof of averments.
Legal Topics
Penalty Clauses, Liquidated Damages, Mutual Contracts, Breach of Contract
Contract Law Delict Penalty Clauses Liquidated Damages Mutual Contracts Breach of Contract

Case Brief

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Parties

Dingwall

Pursuer

Burnett

Defender

Procedural Posture

Civil / Appeal

Legal Issues

  1. 1 Whether the penalty clause in the contract limits damages recoverable for breach
  2. 2 Whether the sum stipulated is a penalty or liquidated damages
  3. 3 Whether the pursuer is entitled to recover the deposit-receipt without inquiry into damages

Ratio Decidendi

The penalty clause in the contract is not to be construed as liquidated damages but as a penalty; it does not limit the defender's right to recover actual damages for breach, provided they do not exceed the penalty if action is founded on the penalty clause. The pursuer cannot insist on performance or recovery of the deposit-receipt without inquiry into damages, as the unity of the contract must be respected.

Court Disposition

Appeal allowed; interlocutor recalled; case remitted for proof of averments.

Orders

  • Recall the interlocutor appealed against.
  • Repel the 1st, 4th, and 5th pleas in law for the pursuer and the second alternative of plea 7.