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42 Sing. L. Rev. 18 (2025)
Account of Profits and Contract: Strange Bedfellows or Just Strangers?

handle is hein.journals/singlrev42 and id is 31 raw text is: Singapore Law Review (2025) 42 Sing L Rev ACCOUNT OF PROFITS AND CONTRACT: STRANGE BEDFELLOWS OR JUST STRANGERS? PETER DEVONSHIRE* The orthodox remedy for breach ofcontract is damages. A cynical breach to minimise loss or exploit more promising economic opportunities is not visited with any greater sanction. This begs the question whether equitable relief in the form ofan account ofprofits should be available in egregious cases. Starting from firstprinciples, it must be asked whether an account ofprofits can be reconciled with the remedial regime of contract. The most notable argument is that profits can be disgorged as an exceptionalform of reliefif there is a special interest in performance and damages cannot satisfy the demands of justice. It is concluded that this is doctrinally unsound and unsupported by precedent. Moreover, the determination of profits from an equitable wrong is inconsistent with the normative scheme of contract. Finally, restitutionary damages have limited relevance and cannot be advanced as a principle of general application. I. INTRODUCTION It is trite that the orthodox remedy for a breach of contract is damages. The common law's focus is strictly compensatory. It is considered that the promisee has been made whole on payment of expectation-based damages, or more exceptionally, reliance-based damages. The promisor avoids further liability for actual performance on payment of a lesser sum of compensatory damages. On payment of damages, the contract-breaker can retain any gains derived from the breach and is at liberty to pursue more valuable economic opportunities. In limited cases where compensatory damages are inadequate, the common law has granted money judgments reflecting gains derived from the wrong. However, such awards do not * Professor of Law, University of Auckland. A version of this article was presented at the 17th Annual International Conference on Contracts, KCON XVII, held at the University of Bristol, June 2024. I would like to thank the participants for their comments. My thanks are also due to Larry Garvin and Yehuda Adar for helpful discussions after the conference. Finally, I am most grateful to Rohan Havelock for reviewing an earlier draft of this article.