Contracts and Emotional Distress - Essay Example

Contracts and Emotional Distress Name Institution Date Issues Can Henrietta recover for ‘mental distress and upset’ arising from breach of contract by the law firm? Rules The general rule set out in Addis v Gramophone Co (1909) A.C. 488 asserts that damages for mental distress are not recoverable under contract law. However, Australian courts have established exemptions to this general rule. In the leading case of Baltic Shipping Company v Dillon, damages for emotional distress are recoverable, if they result from a physical inconvenience or if the subject matter of the contract is to provide “provide enjoyment, relaxation or freedom from molestation." In the same case, Justice Brennan in paragraph 7 asserted that damages for disappointment and distress are recoverable if they arise from a breach of an express or implied term of the contract. Justice Deane and Dawson also asserted that recovery for emotional distress is possible where the offending contractual party offered to provide entertainment, pleasure, relaxation, or to prevent vexation or molestation. Application In common Law, a party that has suffered from a breach of contract by the other contractual party can obtain the remedy of damages. As asserted in Robinson v Harman (1848) 154 ER 363, damages are an equitable remedy meant to compensate for loss or injury that is a consequence of breach by the other party. The remedy means to return the aggreived party to the position he would have been had the plaintiff not breached the contract. Damages are not a punitive remedy and do no seek to punish the party liable for breach of contract. However, the common law has sought to limit damages to cases where it is just and practical to hold the breaching party accountable for damages. Acording to Hadley v Baxendale (1854) 156 ER 145, courts will not order for recovery, if the consequences of breach of contract are too remote. Damages will only be recoverable, if the consequence: arise naturally from the breach, and the consequence could be contemplated as a result of breach of the contract. Even if the general limitation to recovery of damages in contract is applied to her case, Henrietta should still be able to make recovery for emotional distress. Henrietta’s emotinal distress arises naturally from the law firms failure to provide competent counsel, and protect her from molestation by his former male friend. In addition, the law firm could have reasonably foreseen that their failure to offer competent legal assistance to Henrietta would lead to emotional distress. Henrietta was alreadly distressed when he sought help from the law firm. However, the law firm failed to obtain an unjunction that would have prevented ther male friend from visiting her house. From Baltic Shipping Company v Dillon, the plaintiff is first required to prove that his/her emotional distress flows from physical inconvenience (Kambovski 1994). However, in this case, the emotional distress does not result from any physical inconvenience. However, Henrietta would still be able to make recovery for emotional distress as it was result of a breach of a contract related to provision of relaxation, enjoyment or to prevent molestation (Evans 2004). The contract between Henrietta and the law firm was for the provision of legal services to protect her from molestation. Often, courts have ruled that “emotional distress” is “too remote” to be recovered in a breach of contract case (Kambovski 1994). However, this limitation cannot apply to Henrietta’s case. As stated in by Justice Brennan, if the defendant breach of contract is concerned with an implied or express term of the contract, then the damage cannot be ruled to be too remote. In the case, the promise to use legal mean to stop Henrietta’s former male friend from harassing her is an express term of the contract. In addition, the client solicitor relationship contains an implied term that the solicitor will act in the best interest of the client. In the Henrietta’s case, both the implied and express terms of the contract were breached. In Baltic Shipping Company v Dillon, the cruise company had implied that Ms. Dillon would have an enjoyable cruise in the South Pacific. Similarly, the law firm had agreed to help get an injunction to protect Henrietta from harassment by a former male friend. Courts will award for emotional distress, if the damage is a direct consequence of the breach of contract. In contrast, courts are less reluctant to award damages, if the emotional distress is a consequence of a reaction to a breach of contract (Evans 2004). In this case, the breach of contract further added to the emotional distress already suffered by Henrietta due to molestation. The law firm caused Henrietta further embarrassment instead of helping her to deal with the male friend who was harassing her. Thus, the emotional distress suffered by Henrietta can be exempted from general rule in Addis v Gramophone Co (1909) A.C. 488. Further, Justice Dawson and Deane in Baltic Shipping Company v Dillon stated that damages for emotional loss and disappointment are recoverable in situations where the party bleaching the contract implied or explicitly state their intention to provide entertainment, pleasure, relaxation and to prevent molestation. In Henrietta’s case, the law firm had agreed to provide services that would protect Henrietta from molestation. Two cases dealing with the conduct of solicitors to their clients help to apply the guidelines set out in Baltic Shipping Company v Dillon to advocate/client relationships. The two cases are: Heywood v Wellers and Eaton v Owens (Legal Practice) (2010) VCAT 1123 are concerned with the client’s relationship with a law firm. In Heywood v Wellers an incompetent solicitor caused the client mental distress by failing to fulfill his promise to protect the client from molestation. According to Hunter (1993), the client was able to recover damages as the mental distress was a “direct and inevitable consequence of the litigator’s breach of contract. The case held that damages were available as the litigator failed to secure the very relief that was the subject of the litigation. In Heywood v Wellers, damages for mental anguish were recoverable as the litigator failed to obtain an order that would have ensured peace of mind for the client. Similarly, the general exception to the Addis principle concerning contract meant to provide peace of mind or protect a person from molestation is supported by facts in the Henrietta’s case. In Eaton v Owens (Legal Practice) (2010) VCAT 1123, the Victorian Civil and Administrative tribunal ruled that damages disappointment and emotional distress are recoverable, if the distress is related to a genuine dispute between a client and a litigator as set out in Part 5 of the Legal Profession Act. Under section 122(1) (c), a person may recover for damages related to a dispute in the provision of legal services by either a law firm or a person. In Eaton v Owens, Ms Owens had acted as the solicitor of Mr. Eaton in a criminal case. Mr. Eaton among other things accused the litigator of causing emotional distress by failing to carry out his duty as a legal practitioner diligently. However, the Tribunal dismissed this argument after examining the facts of the case. The tribunal held that it could not award damages for Mr. Eaton’s disappointment and emotional distress. The claimed emotional distress resulted from the mishandling of his personal property by Ms. Owen after the latter was imprisoned. Damages could not be recovered as the contract did not contain any implied or express instructions that Ms Owen would take care of Mr. Eaton’s possessions in her capacity as a legal practitioner. Although, the plaintiff and Ms. Eaton held a discussion in a coffee shop regarding Mr. Eaton’s possession in case of a conviction this did not amount to an agreement to protect the latter’s possession in case he was imprisoned. In addition, the legal engagement with Ms. Owen did not contain an implied term that Ms. Owen would take care of Mr. Eaton’s possession if he was imprisoned or unable to take care of them. The Tribunal found that there was no implied term to take care of the Mr. Eaton’s possession. In contrast, there was an express term in Henrietta’s contract with the solicitor which meant the solicitor was supposed to obtain an injunction to protect Henrietta from harassment and ensure her peace of mind. In addition, Eaton v Owens established that legal practitioner/Client relationship contains an implied term that the legal practitioner will act in the best interest of the client. In Henrietta’s case, the legal practitioner failed to act in the best interest of the client, and thus the resulting emotional distress and upset is a direct result of the client’s breach. Conclusion Henrietta will be able to recover damages for the emotional distress suffered as a result of the law firm’s incompetent representation. The law firm failed to live up to the promise of protecting Henrietta from harassment and therefore their conduct resulted in Henrietta’s emotional distress. The law firm is held liable for emotional distress as it breached an express term of the contract to provide Henrietta with protection from molestation by his male friend. References A. Articles/Books/ Reports Evans, PJ, 2004. Spoiled holidays: Damages for disappointment or distress. Legal Issues in Business, vol. 6, pp. 19-25. Hunter, OH 1993. Modern Law of Contracts, Warren, Gorham &Lamont publishers Kambovski, D, 1994. Damages for Mental Distress in Contract.Deakin L. Rev., 1, p.111. B. Cases Addis v Gramophone Co (1909) A.C. 488, 488- Baltic Shipping Company v Dillon, Eaton v Owens (Legal Practice) (2010) VCAT 1123 Hadley v Baxendale (1854) 156 ER 145. Heywood v Wellers [1976] 1 QB 446  Robinson v Harman (1848) 154 ER 363 C. Acts The Legal Proffession Act 2004 (vic) Read More