Agreed compensation is not a penalty
A hirer under a hire purchase agreement could terminate the hiring during the course of the term whereupon the hirer was required to pay a sum by way of agreed compensation.
Held: A sum of money payable under a contract on the occurrence of an event other than a breach of a contractual duty owed by the paying to the receiving party is not a penalty. The system of equity has become a very precise one.
Harman LJ cautioned against applying equitable principles as they used to be in the early Chancery decisions: ‘Equitable principles are, I think, perhaps rather too often bandied about in common law courts as though the Chancellor still had only the length of his own foot to measure when coming to a conclusion. Since the time of Lord Eldon the system of equity for good or evil has been a very precise one, and equitable jurisdiction is exercised only on well-known principles.’
Holroyd Pearce, Harman LJJ
[1961] 1 QB 445
England and Wales
Cited by:
Appeal from – Campbell Discount Company Ltd v Bridge HL 1962
The parties disputed the validity of a clause in a car hire contract relating to the consequences of a breach.
Held: (Majority) The agreement had been terminated by breach rather than by the exercise of an option, so that the stipulated . .
Cited – Western Fish Products Ltd v Penwith District Council and Another CA 22-May-1978
Estoppel Cannot Oust Statutory Discretion
The plaintiff had been refused planning permission for a factory. The refusals were followed by the issue of Enforcement Notices and Stop Notices. The plaintiff said that they had been given re-assurances upon which they had relied.
Held: The . .
Lists of cited by and citing cases may be incomplete.
Contract, Equity
Leading Case
Updated: 09 November 2021; Ref: scu.517567
