Priyanka Shipping Ltd v Glory Bulk Carriers PTE Limited [2019] EWHC 2804 (Comm)

“19. The vessel is sold for the purpose of demolition only and the Buyers hereby guarantee that they will not trade the Vessel further nor sell the vessel to a third party for any purpose other than demolition and will, on completion of demolition, furnish to the Sellers a certificate stating that the vessel has been totally demolished.”

“further telcon kindly provide TCD and class status. Buyers would like to look for any opportunity out there to see if any voyage can be undertaken due to the significant fall in the subcont in terms of sentiment and steel prices. Buyers are bound to lose a lot of money thus kindly requesting for this info and for the green light to have the option to trader her to at least be able to speculate on the market and try and minimize the losses as much as possible.”

“Due to the falling demand for commodities traditionally carried by Capesize ships, limiting fleet growth will become even more important if freight rates are to be profitable.”

“… the [Buyer] may (although it is not certain that it will) continue to trade the Vessel if the Court does not restrain it by injunction from doing so.”

“16. Arbitration If any dispute should arise in connection with the interpretation and fulfillment of this Agreement, same shall be exclusively decided by the High Court of Justice of England and Wales in London in accordance with the Laws of England. Both parties undertake to nominate London solicitors authorised to accept service of High Court proceedings and to file an acknowledgment of service in respect thereof.”

“10. The Plaintiff has sold the Defendant No. 1 Vessel solely for the purpose of demolition/scrapping and accordingly fixed the price and charged the Defendant No. 1 Vessel to the Defendant No. 2. Had it be [sic] known to the Plaintiff that the Defendant No. 2 would ply the Defendant No. 1 Vessel for trading, the sale price would have been different and higher on the basis of trading. The Plaintiff would have even plied the Defendant No.1 Vessel for its own trading and/or by chartering and the Plaintiff would have earned more. 11. The Plaintiff therefore made enquiry with the Brokers for the sale price of trading of Defendant No. 1 Vessel. In response to the same the Agents/Brokers by emails informed the Plaintiff that the similar Vessels like the Defendant No. 1 Vessel in terms of the age have been sold for trading purposes at higher prices than the price for which the Defendant No. 1 Vessel has been sold and also sent the sale price of such other Vessels. Copies of the Emails from the brokers are produced herewith. The Plaintiff upon further enquiry from various brokers has obtained a Valuation Certificate dated 17th July 2019 which states the Vessel valuation at USD 12,000,000 as on 26th April 2019 i.e., the date of the MOA. Therefore, if the Plaintiff takes the lowest price i.e. USD 12,000,000 the Vessel’s valuation as indicated by the Brokers in their Valuation Report dated 17th July 2019, as against the sale price of the MOA i.e. USD 9,623,184.90 then also the Plaintiff suffers a loss of sale price of about USD 2,376,815.10. Therefore the difference of sale price of USD 2,376,815.10 is the actual loss or damages suffered by the Plaintiff on account of the breach of Clause 19 by the Defendant No. 2. The Plaintiff further learnt that the Defendant No. 2 has also earned the freight by plying the Defendant No. 1 Vessel. Thus the Plaintiff is at loss on both counts inasmuch as the Plaintiff has sold the Defendant No.1 Vessel at a lower price and meanwhile has also lost earnings by plying of the Defendant No. 1 Vessel. The said Vessel’s Valuation Report and the Brokers Emails are produced herewith. … 15 In response to the aforesaid email, the Plaintiff’s FDD Insurer addressed an email to the Brokers on 28th June 2019 stating that the Defendant No. 1 Vessel was sold under Clause 19 of the MOA for the specific purpose of demolition only and the Defendant No. 2 had guaranteed that they would not trade the Defendant No. 1 Vessel further in any manner. The Plaintiff vide the same email served on the Defendant No. 2 final notice before proceeding against them legally and also stated that they had estimated the Voyage earning to be about USD 520,528.39 which the Defendant No. 2 is liable to pay to the Plaintiff along with further costs. A copy of the email dated 28th June 2019 addressed by the Plaintiff’s FDD insurer is produced herewith. It may be noted that the Plaintiff has estimated the said loss on the basis of freight earned by the Defendant No. 2 for trading the Defendant No. 1 Vessel instead of demolishing the Vessel and asked for the same in the notices the Plaintiff takes the lowest price i.e. USD 12,000,000 the Vessel’s valuation as indicated by the Brokers in their Valuation Report dated 17th July 2019, as against the sale price of the MOA i.e. USD 9,623,184.90 then also the Plaintiff suffers a loss of sale price of about USD 2,376,815.10. Therefore the difference of sale price of USD 2,376,815.10 is the actual loss or damages suffered by the Plaintiff on account of the breach of Clause 19 by the Defendant No. 2. The Plaintiff further learnt that the Defendant No. 2 has also earned the freight by plying the Defendant No. 1 Vessel. Thus the Plaintiff is at loss on both counts inasmuch as the Plaintiff has sold the Defendant No.1 Vessel at a lower price and meanwhile has also lost earnings by plying of the Defendant No. 1 Vessel. The said Vessel’s Valuation Report and the Brokers Emails are produced herewith. Insurer addressed an email to the Brokers on 28th June 2019 stating that the Defendant No. 1 Vessel was sold under Clause 19 of the MOA for the specific purpose of demolition only and the Defendant No. 2 had guaranteed that they would not trade the Defendant No. 1 Vessel further in any manner. The Plaintiff vide the same email served on the Defendant No. 2 final notice before proceeding against them legally and also stated that they had estimated the Voyage earning to be about USD 520,528.39 which the Defendant No. 2 is liable to pay to the Plaintiff along with further costs. A copy of the email dated 28th June 2019 addressed by the Plaintiff’s FDD insurer is produced herewith. It may be noted that the Plaintiff has estimated the said loss on the basis of freight earned by the Defendant No. 2 for trading the Defendant No. 1 Vessel instead of demolishing the Vessel and asked for the same in the notices 27. The Plaintiff therefore prays: a. That the Defendants be ordered and decreed to pay to the Plaintiff for the principal amount of USD 2,376,815.10 (United States Dollars Two Million Three Hundred Seventy Six Thousand and Eight Hundred and Fifteen and Ten Cents only) together with Legal costs & Expenses aggregating to total amount of USD 20,000 with further interest on USD 2,396,815.10 (United States Dollars Two Million Three Hundred Ninety Six Thousand and Eight Hundred and Fifteen and Ten Cents only) at the rate of 6% p.a. from the date of suit until payment/realisation as per particulars of claim.”

“6. The [Buyer’s] claim for declaratory relief and the Injunction Counterclaim shall be tried together at a hearing to be listed on Tuesday 24 September 2019 with an estimate of 1 day.”

“19. By reason of Buyers’ breaches of Clause 19, Sellers have suffered loss and damage in an amount to be assessed but presently estimated to be US$2,400,000. Particulars 19.1. Sellers’ losses are appropriately measured by reference to the economic value of the right which has been breached, viz. Sellers’ right to restrict the trading of the Vessel (which includes the correlative right to permit the Vessel to be used for trading). Accordingly, Sellers claim damages in an amount to be assessed based on the value of that right. 19.2. Sellers presently estimate those damages at US$2,400,000, based on the difference between the price paid for the Vessel under the MOA for scrapping (US$9,623,184.90) and the market price for the Vessel had she been sold without the trading restriction in Clause 19 (US$12,000,000).” 50. The language used in the first of the sub-paragraphs, in particular the phrase “the economic value of the right which has been breached” reflects language used in the recent decision of the Supreme Court in One Step (Support) Ltd v Morris Garner [2018] UKSC 20, [2019] AC 649 (One Step) and a claim for what is now properly referred to as “negotiating damages”

“20.2 Further, Sellers claim equitable damages in an amount to be assessed, based on the price which Sellers could reasonably have demanded from Buyers to release them from their undertaking in Clause 19 up until the date on which the abovementioned injunction takes effect. At present, Sellers estimate these damages at about US$849,000, based on 70% of the total gross profits earned by Buyers under the First Fixture and the Second Fixture. 20.3 Alternatively, Sellers claim damages in lieu of an injunction in an amount to be assessed, based on the price which Sellers could reasonably have demanded from Buyers to release them from their undertaking in Clause 19. At present, Sellers estimate these damages at US$2,400,000, based on the difference in price set out in paragraph 19 above.”

“My Lords, if there had been a negative covenant, I apprehend, according to well-settled practice, a Court of Equity would have had no discretion to exercise. If parties, for valuable consideration, with their eyes open, contract that a particular thing shall not be done, all that a Court of Equity has to do is to say, by way of injunction, that which the parties have already said in by covenant, that the thing shall not be done; and in such case the injunction does nothing more than give the sanction of the process of the Court to that which already is the contract between the parties. It is not then a question of the balance of convenience or inconvenience, or the amount of damage or of injury – it is the specific performance, by the Court, of that negative bargain which the parties have made, with their eyes open, between themselves.”

“In exercising the jurisdiction by way of mandatory injunction against acts in violation of a contract, covenant, or agreement, the Court looks to the express stipulation of the agreement, and is not, as in cases of trespass or nuisance, influenced by considerations as to the nature or extent or the damage, or the comparative convenience or inconvenience of granting or withholding the injunction. A man who enters into an agreement is bound in equity to a true and literal performance of it. He cannot be suffered to depart from it at his pleasure, leaving the other party to his remedy by damages at law. There may be cases in which it is so clear that the mischief to arise from a breach of covenant would be inappreciable that a Court may decline to interfere on the ground that a mandatory injunction would be out of all proportion to the requirements of the case, and would operate with extreme harshness on the defendant. But as a general rule, the inconvenience to the defendant will not in such cases be taken into consideration. Nor can the defendant be permitted to set up the inconvenience to the public which would arise from his being compelled to perform his agreement.”

“The conclusion to be drawn from the authorities is that, where a contract of personal service contains negative covenants the enforcement of which will not amount either to a decree of specific performance of the positive covenants of the contract or to the giving of a decree under which the defendant must either remain idle or perform those positive covenants, the Court will enforce those negative covenants; but this is subject to a further consideration. An injunction is a discretionary remedy, and the Court in granting it may limit it to what the Court considers reasonable in all the circumstances of the case.”

“The case before me is, therefore, one in which it would be proper to grant an injunction unless to do so would in the circumstances be tantamount to ordering the defendant to perform her contract or remain idle or unless damages would be the more appropriate remedy.”

“It is a simple case of someone who has entered into a negative covenant for a consideration where the covenant is not limited territorially and is not limited in time. As Nourse LJ pointed out in argument, in such circumstances the courts habitually enforce the covenant provided only that the covenant itself cannot be attacked for obscurity, illegality or on public policy grounds such as that it is in restraint of trade.”

“No one suggests or could suggest that damages would be an adequate remedy for the plaintiff, and there may well be difficulties in calculating the damages if the defendant were to succeed. Thus, we are concerned with where the balance of justice lies: ‘convenience’ is the word used in the report [in American Cyanamid] but that may be misleading. Pending a final hearing, the balance of justice clearly dictates that some injunction be granted.”

“The effect of the authorities can be summarized as follows: (1) Express or implied negative covenants will in general be enforced by injunction without proof of damage by the plaintiff. (2) The principle does not depend on whether the plaintiff is a person or a corporation. The ready availability of the remedy is not the consequence of equity’s regard for the plaintiff’s personal feelings, but of equity’s perception that it is unconscionable for the defendant to ignore his bargain. (3) Although absence of damage to the plaintiff is not in general a bar to relief, there may be exceptional cases where the granting of an injunction would be so prejudicial to a defendant and cause him such hardship that it would be unconscionable for the plaintiff to be given injunctive relief if he could not prove damage. In such cases an injunction will be refused and the plaintiff will be awarded nominal damages.”

“4. Fourth, this is all subject to discretion, an injunction being an equitable remedy. Although I emphasise the basic rule that an injunction in the circumstances described will normally be granted as a matter of course. But injunctive relief may be refused if it is oppressive to the defendant or cause him particular hardship, although it would not be oppressive merely because burdensome or little prejudice to the claimant.”

“Where the defendant is proposing to act in clear breach of a negative covenant, in other words to do something which he has promised not to do, there must be special circumstances (e.g. restraint of trade contrary to public policy) before the court will exercise its discretion to refuse an injunction.”

“65. The defendant voluntarily entered into a contract for substantial reward containing both positive and negative obligations. There is nothing special about the world of racing which entitles the major players to act in flagrant breach of contract. The defendant has promised in the context of a commercial agreement that he will not compete against Native Khan in the Derby this afternoon. In my view, that promise should be enforced.”

“Why, therefore, in circumstances such as these, should the court’s approach to the claimant’s claim be other than one reflecting a firm recognition that the remedy to which it ought prima facie to be entitled is an injunction?”

“20. If I may say so, and by reference to Colman J’s summary quoted in para 18 above, I have some respectful reservations as to the value of judicial observations to the effect that a particular principle will ordinarily apply save in ‘exceptional cases’ or ‘exceptional circumstances’, since it usually leaves open an unhelpfully wide margin for parties in future cases to find themselves at odds as to whether or not their case is ‘exceptional’. That said, I consider that Colman J’s quoted summary would in fact be just as valuable if he had omitted the word ‘exceptional’ since he anyway explained the circumstances he had in mind in which it might not be appropriate to grant an injunction. Sir Donald Rattee, in Dyson Technology Ltd v Strutt [2005] EWHC 2814 (Ch) endorsed and applied Colman J’s guidance and held that the case before him was not the type of exceptional case to which Colman J had referred and that Mr Strutt should be held to his bargain by the grant of an injunction. 21. I respectfully agree with the approach reflected in the Insurance Company and Strutt cases, namely that the starting point in the consideration of a claim by an employer to enforce an employee’s negative covenant is that the ordinary remedy is an injunction. Given, however, that an injunction is a discretionary remedy, that is not necessarily also the finishing point, although I would be wary of attempting to prescribe with any sort of particularity the types of circumstances in which it might be appropriate to refuse an injunction. The exceptional circumstances referred to by Colman J do, I consider, provide a helpful general explanation as to the types of case in which it may be just to do so. But the categories of circumstances are never closed and every case will turn on its own facts. […] 22. There is in my view, therefore, no doubt that the approach to the exercise of the discretion is, as the judge held, not a ‘mechanistic’ one. Nor in my view, as he also held, is there any doubt that in a case such as the present the burden of showing why an injunction should not be granted is on the covenantor. I reach both these conclusions by reference to the authorities relating to the breach of negative covenants and that pre-dated Lawrence v Fen Tigers Ltd [2014] AC 822. The approach is, however, essentially consistent with that to be derived from Lawrence.”

“The very first principle of injunction law is that prima facie you do not obtain injunctions to restrain actionable wrongs for which damages are the proper remedy.”

“… the effect of such a refusal in a case like the present would necessarily operate to enable a company who could afford it to drive a neighbouring proprietor to sell, whether he would or no, by continuing a nuisance, and simply paying damages for its continuance.”

“Without denying the jurisdiction to award damages instead of an injunction, even in cases of continuing actionable nuisances, such jurisdiction ought not to be exercised in such cases except under very exceptional circumstances. I will not attempt to specify them, or to lay down rules for the exercise of judicial discretion. It is sufficient to refer, by way of example, to trivial and occasional nuisances: cases in which a plaintiff has shown that he only wants money; vexatious and oppressive cases; and cases where the plaintiff has so conducted himself as to render it unjust to give him more than pecuniary relief. In all such cases as these, and in all others where an action for damages is really an adequate remedy – as where the acts complained of are already finished – an injunction can properly be refused.”

“Many judges have stated, and I emphatically agree with them, that a person by committing a wrongful act (whether it be a public company for public purposes or a private individual) is not thereby entitled to ask the Court to sanction his doing so by purchasing his neighbour’s rights, by assessing damages in that behalf, leaving his neighbour with the nuisance, or his lights dimmed as the case may be. In such cases the well-known rule is not to accede to the application, but to grant the injunction sought for the plaintiff’s legal right has been invaded, and he is prima facie entitled to an injunction. There are, however, cases in which this rule may be relaxed, and in which damages may be awarded in substitution as authorized by this section. In any instance in which a case for an injunction has been made out, if the plaintiff by his acts or laches has disentitled himself to an injunction the Court may award damages in its place. So again, whether the case be for a mandatory injunction or to restrain a continuing nuisance, the appropriate remedy may be damages in lieu of an injunction, assuming a case for an injunction to be made out. In my opinion, it may be stated as a good working rule that – (1) If the injury to the plaintiff’s legal rights is small, (2) And is one which is capable of being estimated in money, (3) And is one which can be adequately compensated by a small money payment, (4) And the cases is one in which it would be oppressive to the defendant to grant an injunction then damages in substitution for an injunction may be given. There may also be cases in which, though the four abovementioned requirements exist, the defendant by his conduct, as, for instance, hurrying up his buildings so as if possible to avoid an injunction, or otherwise acting with a reckless disregard to the plaintiff’s rights, has disentitled himself from asking that damages may be assessed in substitution for an injunction.”

“It is important to bear in mind that the test is one of oppression, and the court should not slide into the application of a general balance of convenience test. But oppression must be judged as at the date the court is asked to grant and injunction, and (as Brightman J recognised in the Wrotham Park case) the court cannot ignore the reality with which it is then confronted.”

“It would weigh against a finding of oppression if the defendants had acted in blatant and calculated disregard of the plaintiff’s rights of which they were aware”

“When the plaintiff claims an injunction and the defendant asks the court to award damages instead, the proper approach for the court to adopt cannot be in doubt. Clearly the plaintiff must first establish a case for equitable relief, not only by proving his legal right and an actual or threatened infringement by the defendant, but also by overcoming all equitable defences such as laches, acquiescence or estoppel. If he succeeds in doing this, he is prima facie entitled to an injunction. The court may nevertheless in its discretion withhold injunctive relief and award damages instead. How is this discretion to be exercised? In a well known passage in Shelfer v City of London Electric Lighting Co. [1895] 1 Ch 287, 322-323, A.L. Smith L.J. set out what he described as a ‘good working rule’ that [omitted] Laid down just 100 years ago, A.L. Smith L.J.’s check-list has stood the test of time; but it needs to be remembered that it is only a working rule and does not purport to be an exhaustive statement of the circumstances in which damages may be awarded instead of an injunction. Reported cases are merely illustrations of the circumstances in which particular judges have exercised their discretion, in some cases by granting an injunction, and in others by awarding damages instead. Since they are all cases on the exercise of a discretion, none of them is a binding authority on how the discretion should be exercised. The most that any of them can demonstrate is that in similar circumstances it would not be wrong to exercise the discretion in the same way. But it does not follow that it would be wrong to exercise it differently. The outcome of any particular case usually turns on the question: would it in all the circumstances be oppressive to the defendant to grant the injunction to which the plaintiff is prima facie entitled? Most of the cases in which the injunction has been refused are cases where the plaintiff has sought a mandatory injunction to pull down a building which infringes his right to light or which has been built in breach of a restrictive covenant. In such cases the court is faced with a fait accompli. The jurisdiction to grant a mandatory injunction in those circumstances cannot be doubted, but to grant it would subject the defendant to a loss out of all proportion to that which would be suffered by the plaintiff if it were refused, and would indeed deliver him to the plaintiff bound hand and foot to be subjected to any extortionate demands the plaintiff might make […] … In considering whether the grant of an injunction would be oppressive to the defendant, all the circumstances of the case have to be considered. At one extreme, the defendant may have acted openly and in good faith and in ignorance of the plaintiff’s rights, and thereby inadvertently placed himself in the position where the grant of an injunction would either force him to yield to the plaintiff’s extortionate demands or expose him to substantial loss. At the other extreme, the defendant may have acted with his eyes open and in full knowledge that he was invading the plaintiff’s rights, and hurried on his work in the hope that by presenting the court with a fait accompli he could compel the plaintiff to accept monetary compensation. Most cases, like the present, fall somewhere in between.” 114.Shelfer and Jaggard make plain three matters: [omitted] i) First, that once the claimant has established his legal right and the actual or threatened infringement, and has overcome any equitable defences, he is prima facie entitled to an injunction. It is for the defendant to satisfy the court that, in the exercise of its discretion, it ought not to grant an injunction but should award damages instead; ii) Secondly, that although AL Smith LJ’s good working rule includes other matters, the most important question in any case is likely to be whether the grant of an injunction would be oppressive to the defendant. Insofar as there is a test (recognising that the question is one of discretion which depends upon all the circumstances of the particular case), it is oppression; iii) Thirdly, even if oppression is made out, there may be circumstances in which an injunction should still be granted. AL Smith LJ contemplated that in the case of a defendant “hurrying up … to avoid an injunction” an award of damages in lieu of an injunction might be refused. Sir Thomas Bingham MR similarly spoke of defendants who had acted “in blatant and calculated disregard of the plaintiff’s rights of which they were aware”

“1. Save that the Claimant and the vessel “LORY” (“the Vessel”) may complete any loaded voyage being performed at the time this order is made, the Claimant shall forthwith refrain from trading the Vessel and shall not trade the Vessel or re-sell the Vessel for trading at any time in the future.” 2. For the avoidance of doubt, the injunction in paragraph (1) above restrains the Claimant from using the Vessel to perform the fixture the subject of the fixture recap dated 24 September 2019 at Appendix A hereto.”

“I find in the Act no warrant for the court awarding damages differently from common law damages.”

“… based on the price which Sellers could reasonably have demanded from Buyers to release them from their undertaking in Clause 19 up until the date on which the abovementioned injunction takes effect. At present, Sellers estimate these damages as about US$849,000 based on 70% of the total gross profits earned by Buyers under the First Fixture and the Second Fixture.”

“… on the one hand, to describe every type of compensatory damages which exceed the actual financial loss to the claimant, and, on the other hand, damages awarded in lieu of specific performance or injunction under [Lord Cairns’ Act]; and, in the latter context, between non-proprietary breaches of contract, and those involving the invasion of a property right.”

“30. In these cases, the courts have treated user damages as providing compensation for loss, albeit not loss of a conventional kind. Where property is damaged, the loss suffered can be measured in terms of the cost of repair or the diminution in value, and damages can be assessed accordingly. Where on the other hand the unlawful use is made of property, and the right to control such use is a valuable asset, the owner suffers a loss of a different kind, which calls for a different method of assessing damages. In such circumstances, the person who makes wrongful use of the property prevents the owner from exercising his right to obtain the economic value of the use in question, and should therefore compensate him for the consequent loss. Put shortly, he takes something for nothing, for which the owner was entitled to require payment.”

“The rule of the common law is, that where a party sustains loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.”

“35. Damages for breach of contract are in that sense a substitute for performance. That is why they are generally regarded as an adequate remedy. The courts will not prevent selfinterested breaches of contract where the interests of the innocent party can be adequately protected by an award of damages. Nor will the courts award damages designed to deprive the contract breaker of any profit he may have made as a consequence of his failure in performance. Their function is confined to enforcing either the primary obligation to perform, or the contract breaker’s secondary obligation to pay damages as a substitute for performance (subject, according to the decision in Attorney General v Blake, to a discretion to order an account of profits in exceptional circumstances where the other remedies are inadequate). The damages awarded cannot therefore be affected by whether the breach was deliberate or selfinterested. 36. It follows from the principle in Robinson v Harman 1 Exch. 850 that the language of election is not appropriate in a discussion of the quantification of damages for breach of contract. The objective of compensating the claimant for the loss sustained as a result of non-performance (an expression used here in a broad sense, so as to encompass delayed performance and defective performance) makes it necessary to quantify the loss which he sustained as accurately as the circumstances permit. What is crucial is first to identify the loss: the difference between the claimant’s actual situation and the situation in which he would have been if the primary contractual obligation had been performed. Once the loss has been identified, the court then has to quantify it in monetary terms.” been performed. Once the loss has been identified, the court then has to quantify it in monetary terms.”

“A restrictive covenant over land is enforceable in contract only as between the original parties, but it is enforceable in equity as between their successors in title to the land in question. Its effect is to create an equitable obligation whose benefit and burden run indefinitely with the ownership of each parcel of land, rather like a negative easement. It is for that reason that the benefit of the restrictive covenant is recognised as ‘a new kind of property right created by equity’: Megarry & Wade, the Law of Real Property, 8th ed (2012), para 5-026.”

“62. The awards made in the Wrotham Park case [1974] 1 WLR 798 itself, and in the cases in which it was followed during the next quarter-century, were made in the exercise of a unique statutory jurisdiction: the award of damages in lieu of an injunction. The purpose of the awards was to provide the claimant with an appropriate monetary substitute for an injunction in the circumstances of the particular case. Every reported case appears to have concerned either a tortious interference with property rights, or the breach of a restrictive covenant over land. Damages were assessed according to the amount which might fairly have been charged for the voluntary relinquishment of the right which the court had declined to enforce, subject to downward adjustment for reasons of fairness. 63. That measure reflected the fact that the refusal of an injunction had the effect of depriving the claimant of an asset which had an economic value.”

“… although it is not clear what Lord Nicholls meant by ‘a lesser degree of remedy’ … it is not surprising that damages for breach of contract are generally assessed differently from damages for the invasion of a proprietary right, since the rights and obligations in question are generally of a different character. It is only in circumstances where they are analogous that it would be reasonable to expect some consistency of approach. As has been explained, damages for breach of contract are based on the difference to the claimant between the outcome of performance and non-performance. That is not generally the same as the economic value of the right to performance, considered as an asset (which is not to deny that they may be the same, or similar, in some circumstances). This point was made in a different context by Lord Sumption JSC, with whom Lord Neuberger of Abbotsbury PSC, Lord Mance and Lord Clarke of Stone-cum Ebony JJSC agreed in Bunge SA v Nidera BV (formerly Nidera Handelscompagnie BV) [2015] Bus LR 987, para 21: ‘Sections 50 and 51 of the Sale of Goods Act [1979], like the corresponding principles of the common law, are concerned with the price of goods and services which would have been delivered under the contract. They are not concerned with the value of the contract as an article of commerce in itself.’”

“These cases can be understood as proceeding on the footing that the result of the breach of contract was that the claimants lost a valuable opportunity to exercise their right to control the use of the information.”

“89. Notwithstanding some of the reasoning, the decision in the case can be supported on an orthodox basis. The agreement gave the claimant a valuable right to control the use made of PPX’s copyright. When the copyright was wrongfully used, the claimant was prevented from exercising that right, and consequently suffered a loss equivalent to the amount that could have been obtained by exercising it.”

“… the loss suffered by the claimant is appropriately measured by reference to the economic value of the right which has been breached, considered as an asset.”

“… the breach of contract results in the loss of a valuable asset created or protected by the right which was infringed.”

“92. […] where the breach of contract results in the loss of a valuable asset created or protected by the right which was infringed, as for example in cases concerned with the breach of a restrictive covenant over land, an intellectual property agreement or a confidentiality agreement” “93. […] [in the case of] some contractual rights, such as a right to control the use of land, intellectual property or confidential information.”