Facts
- Mr. Jarvis booked a holiday with Swan Tours Ltd, expecting relaxation and enjoyment based on the company's representations.
- The holiday provided fell significantly short of the advertised promises, causing him disappointment and mental distress.
- The contract was for a leisure service intended to provide pleasure and enjoyment, rather than purely economic value.
- Mr. Jarvis brought a claim for damages, arguing that his enjoyment and pleasure were central to the contract and that the breach warranted compensation beyond pecuniary loss.
- The case was heard at the Court of Appeal.
Issues
- Whether damages for mental distress can be awarded for breach of contract when the contract's main object is to provide enjoyment or pleasure.
- Whether the disappointment and distress suffered by Mr. Jarvis due to the substandard holiday experience fall within recoverable damages.
- Whether the established limitations on expectation damages, particularly concerning non-pecuniary loss, should be relaxed in contracts for leisure and pleasure.
Decision
- The Court of Appeal held that damages for mental distress are recoverable where the purpose of the contract is to provide enjoyment, pleasure, or relaxation.
- The court recognized that Mr. Jarvis's disappointment and distress resulting from the breach were compensable.
- Damages were awarded to reflect the loss of enjoyment and mental distress suffered, increasing the sum initially given at trial.
- The decision marked a departure from the previous general rule that restricted damages for mental distress to cases of physical inconvenience.
Legal Principles
- The expectation interest principle, as established in Robinson v Harman, aims to place the claimant in the position they would have been in had the contract been performed, including benefits beyond pecuniary losses in appropriate cases.
- There are limits to recoverable damages, including remoteness (Hadley v Baxendale), mitigation, and reasonableness, particularly for reinstatement costs (Ruxley Electronics v Forsyth).
- Jarvis v Swan Tours Ltd established that where a contract's object is pleasure or enjoyment, damages for disappointment and mental distress are recoverable.
- This created an exception to the general rule against compensating mental distress in breach of contract, recognizing the distinctive nature of leisure and holiday contracts.
Conclusion
Jarvis v Swan Tours Ltd broadened the scope of contract damages by allowing compensation for mental distress where the contract's aim is to provide pleasure or enjoyment, establishing a key exception to the traditional limits on non-pecuniary damages and shaping the remedies available for leisure-related contracts.
