H. Intangible Injuries

Author:John D. McCamus
Profession:Professor of Law. Osgoode Hall Law School, York University

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Thus far, we have considered compensation for injuries to the economic interests of the victims of contract breach. A breach of contract may also cause intangible injuries of various kinds. The victim of a breach may, for example, suffer resulting annoyance, humiliation, distress or, indeed, serious psychological trauma. We here consider whether these sorts of intangible injuries may attract compensation. The position under traditional Canadian and English common law doctrine was that such damages were not available. In the latter part of the twentieth century, however, English and then Canadian courts recognized claims of this kind. The leading English case, Jarvis v. Swans Tours Ltd.,202is a classroom favourite in which a solicitor’s high hopes for a pleasurable two-week Swiss vacation - fuelled by claims made in the defendant’s brochure - were dashed when virtually all of the advertised virtues of the experience proved to be either non-existent or below par. The Court of Appeal awarded damages for the resulting mental aggravation. The nature of this case and subsequent authorities provided a basis for a conclusion that in English law, at least, such claims were restricted to contractual contexts in which the object of the agreement was to provide a pleasurable experience or, at least, to ensure one’s peace of mind.203The House of Lords recently clarified the English doctrine on this point in Farley v. Skinner.204The plaintiff, a prospective purchaser of a country property, retained the defendant surveyor to inspect the property and, inter alia, asked him to investigate whether the property would be seriously affected by aircraft noise given its proximity to Gatwick International Airport. Reassured on the latter point by the defendant, the plaintiff acquired the property and, upon moving in,

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discovered that the defendant’s advice on this point was seriously in error. The purchaser brought a claim for non-pecuniary damages for the loss of tranquility resulting from the substantial presence of aircraft noise on the property. The defendant argued in response that such damages could only be claimed where the very object of the contract is to provide pleasure, relaxation or peace of mind and that a contract with a surveyor to inspect a property does not come within that category of agreements. The House of Lords allowed the claim, however, on the basis that it was sufficient if "a major or important object of the contract is to give pleasure, relaxation or peace of mind."205Thus, in this case, where the contract to inspect included a particular undertaking concerning airplane noise that had such an object, damages for consequential mental distress were available.

In Canada, however, it is unlikely that even this limitation exists on the availability of damages for mental distress. Canadian courts have applied the Jarvis doctrine in cases in which the agreements breached cannot be characterized as providing for pleasure or peace of mind.206They have also accepted that the Jarvis doctrine may apply in the context of wrongful dismissal cases.207Recovery in the latter context, however, has been rendered problematic by the 1989 decision of the Supreme Court of Canada in Vorvis v. Insurance Corp. of British Columbia,208or, rather, by subsequent interpretations of the majority reasoning in Vorvis. In this case, the plaintiff lawyer had been abruptly terminated by his employer, a government automobile insurance plan, without cause and without reasonable notice. Prior to the dismissal, his supervisor, who considered the plaintiff to be conscientious to a fault, engaged in detailed and, perhaps, heavy-handed supervision of

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the plaintiff’s work. In addition to the claim for wages that would have been earned during a reasonable...

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