Equitable Damages
| Author | Jeffrey Berryman |
| Profession | Professor of Law. Faculty of Law University of Windsor |
| Pages | 301-317 |
CHAPTER
17
EQUITABLE
DAMAGES
A.
INTRODUCTION
In
this chapter
we
explore
the
extent
to
which chancery courts
can
award
equitable damages. Historically, chancery always exercised
a
jurisdiction
to
award monetary awards, either
as
equitable compensa-
tion (see below)
or as an
account
of
profits.
However,
the
jurisdiction
to
grant damages
was
doubtful.
By
1858
it was
felt
necessary
in
England
to
pass
the
Chancery
Amendment
Act,1
better known
as
Lord
Cairns'
Act,
so as to
empower chancery courts with jurisdiction
to
award
damages
in
claims
for
injunctions
and
specific
performance.2
Although
the
legislation
was
subsequently repealed,
its
sentiments
have
been retained, principally
in
legislation that describes
the
compo-
sition, procedure
and
jurisdiction
of
superior courts.
In
Ontario, sec-
tion
99 of the
Courts
of
Justice
Act3
reads
as
follows:
1 An Act to
amend
the
Course
of
Procedure
in the
High
Court
of
Chancery,
the
Court
of
Chancery
in
Ireland,
and the
Court
of
Chancery
of
the
Country
Palatine
of
Lancaster,
1858
(U.K.),
21 & 22
Viet,
c. 27.
2 For an
excellent history
of the
development
of
this jurisdiction,
see P.
McDermott,
Equitable
Damages
(Sydney:
Butterworths,
1994)
3
R.S.O.
1990,
c.
C.43.
301
302 THE LAW OF
EQUITABLE
REMEDIES
A
court that
has
jurisdiction
to
grant
an
injunction
or
order
specific
performance
may
award damages
in
addition
to, or in
substitution
for,
the
injunction
or
specific
performance.
Similar
provisions
can be
found
in
most other
provinces,4
although
in
some others
the
jurisdiction
is
derived
from
the
express preservation
of
general equitable
jurisdiction.5
It
may
appear paradoxical
to
award damages
in
lieu
of an
equitable
remedy that
is
itself
conditional
on
proving that damages
is an
inade-
quate
remedy.
But as we
shall
see,
there
are two
situations where equi-
table
damages come
in to
their
own:
where there
is no
common
law
remedy
at
all,
or
where
the
defendant
has
raised
sufficient
arguments
against
the
awarding
of
specific
performance
or
injunction
so
that
the
court
is
left
with
no
alternative
but to
award damages.
Of
late,
the
continued vitality
of
equitable damages
as a
distinctive
form
of
redress
has
been undermined
by
developments
in the
availability
of
common
law
damages
and
equitable compensation. However, there
are
still important areas
of
difference.
These will
be the
focus
of
this chapter.
B.
JURISDICTION
The
legislative jurisdiction
for
equitable damages states that they
can
be
awarded
in
addition
to or in
substitution
for an
injunction
or
spe-
cific
performance. Thus,
if a
court
has
jurisdiction
to
grant either
an
injunction
or
specific
relief,
it
also
has
jurisdiction
to
grant equitable
damages.
In the
past much debate
was
generated over whether barriers
to
specific
performance
and
injunctions went
to
jurisdiction
or
merely
discretion.
If the
barrier went
to
jurisdiction, then
no
damages could
be
awarded
in
lieu
of the
equitable
relief.
However,
if the
barrier
was
merely
a
discretionary impediment,
the
denial
of
equitable
relief
did
not
equally deprive
the
plaintiff
of an
award
of
equitable damages.
The
jurisdictional issue
was
raised
before
the
Supreme Court
of
Canada
in
Dobson
v.
Winton
&>
Robins
Ltd.6
The
plaintiff,
a
vendor,
origi-
4 See
Alberta
Judicature
Act,
R.S.A.
1980,
c.
J-l,
s. 20;
Manitoba
The
Court
of
Queen's
Bench
Act,
S.M.
1988-89,
c. 4, s. 36;
Saskatchewan
The
Queen's
Bench
Act,
1998,
S.S.
1998,
c.
Q-1.01,
s.
66(1);
and
Prince Edward
Island
Supreme
Court
Act,
R.S.EE.I.
1988,
c.
S-10,
s. 32.
5 See
Nova Scotia Judicature Act, R.S.N.S.
1989,
c.
240,
s. 41;
British Columbia
Law
and
Equity
Act,
R.S.B.C.
1996,
c.
253,
ss.
2,4
& 5. In
Newfoundland there appears
to
be
something
of a
lacuna, where
the
adoption
of
English
law
took place before
the
enactment
of
Lord
Cairn's
Act
and
where
no
similar
provision
has
since
been
enacted.
6
[1959] S.C.R.
775.
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