An additional and complicating observation that may be made about this apparent 2:1 vindication of “vindicatory” or “compensatory” analyses of Strand ‘user damages’ awards is that the Court continued to insist, as a pre-condition to their availability, that the defendant must make a relevant ‘use’ of the property to which the plaintiff has a right. The ‘use’ need not be an ‘active’ use, but it must ‘contribute’ in some way to the ‘life, work or business’ of the wrongdoer, for example by increasing the disposability or convenience of his or her business. In other words, it must be a use that benefits the defendant. This caused Giles JA to baulk at the majority approach and to prefer the restitutionary analysis. My guess is that Rob would deem this requirement nonsensical and otiose.

Best Wishes,

Kit.

From: Stevens, Robert [mailto:robert.stevens@ucl.ac.uk]
Sent: Monday, 12 March 2012 7:50 PM
To: obligations@uwo.ca
Subject: Damages for Use

Kit Barker draws to my attention a very interesting decision of the NSWCA in Bunnings Group Ltd v Chep Australia.

http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/nsw/NSWCA/2011/342.html?stem=0&synonyms=0&query=Bunnings%20Group%20Ltd

The defendants were liable to the plaintiffs for the conversion of a number of pallets. The plaintiffs were in the business of hiring out pallets and at all times had more pallets than they needed to carry out their business. The defendants argued that as a result the plaintiffs had no loss pleaded or proven as a result of the conversion, nominal damages only should be payable. The interesting bit is at [174]-[175] where they consider the award of damages in cases such as Strand Electric:

174. Stability of approach, especially in a field directly related to commercial law should be maintained. It is unnecessary to discuss the extent to which a degree of re-adjustment in taxonomy is required by reference to notions of restitutionary damages (cf McGregor op cit Ch 12). Rules of compensatory damages, sensibly and flexibly applied, are adequate to explain the theoretical and practical positions, without any extension of principle involving the award of the wrongdoer's profit as a remedial consequence of the commission of a tort.

175. The fundamental principle of damages for tort is compensation for loss caused: Butler v Egg & Egg Pulp Marketing Board [1966] HCA 38; 114 CLR 185; and Haines v Bendall [1991] HCA 15; 172 CLR 60 at 63. The damage or loss caused to the plaintiff with rights of ownership and possession who is in the business of hiring goods of the kind converted or detained is not limited to the consequences of stock depletion or to cost of replacement, but incudes the denial and infringement of its rights. Those rights have been denied to the plaintiff by the commission of a tort involving the use of the goods by the tortfeasor. It is entirely logical and in accordance with justice and commonsense that a wrongdoer should pay a price for using the goods of another as a matter of compensation for the denial of the right concerned. I do not see this as contrary to, or undermining of, the principle of compensation.

Substantial damages payable.

I agree, as anyone familiar with my own musings on these matters knows.

Rob

From:	Kit Barker <k.barker@law.uq.edu.au>
To:	obligations@uwo.ca
Date:	13/03/2012 00:35:31 UTC
Subject:	FW: Damages for Use