This On Demand was originally recorded on 21 September 2021.

This On Demand discusses remedies for agents’ breach of mandate, and license fee damages.

Who should view?

Contract and commercial lawyers, civil litigators, intellectual property practitioners, trusts lawyers and in-house lawyers for banks and other organisations that handle the assets of customers or other third parties.

Learning Outcomes

Remedies for agents’ breach of mandate

Agents who disburse their principals’ funds in breach of mandate – including solicitors, trustees, and banks – are in principle strictly liable for resulting loss. Remedies for breach of mandate have attracted controversy more recently as courts, particularly in the UK, have pushed back against holding an agent strictly liable to account in some cases. There is now clear authority that a principal may have no recovery against the agent if the same or other loss would have been suffered even if the principal’s instructions had been carried out.

This On Demand reviews the remedies available for breach of an agent’s mandate, including in actions for money had and received, an account at equity (for breach of trust), and damages (in contract and tort). Circumstances in which agents otherwise liable may be relieved from liability will also be reviewed. The principles are of general application to agents, but they are particularly relevant to solicitors, trustees and banks. Banks can find themselves liable as agents in some cases and be claiming as principals in other cases where solicitors or other agents have disbursed funds in breach of mandate.

License fee damages

Damages for breach of contract are generally compensatory in nature, intended to put the plaintiff in the position it would have been if the contract had been performed. As such, damages are usually assessed by the actual loss suffered by the plaintiff. If the plaintiff is unable to prove loss, there will generally only be an entitlement to nominal damages.

License fee damages operate as an apparent exception to this rule. Also known as “negotiating damages”, “hypothetical bargain damages” or “Wrotham Park damages”, license fee damages are a special category of damages assessed by reference to a hypothetical negotiation between the parties to fix a price that the innocent party might reasonably have charged to license the breach. Much about the conceptual basis underpinning the remedy remains unresolved, including the circumstances in which it should be granted, and the basis on which it should be assessed.

This On Demand reviews and discuss the conceptual basis of license fee damages and the circumstances in which it is likely to be available in breach of contract claims following the decision of the UK Supreme Court in One Step (Support) Ltd v Morris-Garner [2018] UKSC 20. The availability of damages on a similar basis for breaches of intellectual property rights through the application of the “user principle” will also be discussed by reference to the decisions of the New Zealand Court of Appeal in The New Zealand National Party v Eight Mile Style, LLC [2018] NZCA 596 and Geostel Vision Ltd v Oraka Technologies Ltd [2020] NZCA 256.

Presenter Details

Matthew Harris
Daisy Williams