Breach of contract: damages

In England the courts have held that, although they will recognize a common law implied contractual term of mutual trust and confidence, the fact that there is a vibrant statutory unfair dismissal jurisdiction means that those courts have declined to award damages for breach of contract if the breach of the implied term occurs in the dismissal. In other words the English courts have refused to step on the shoes of the British Parliament and have recognized that the statutory context should constitute a code for unfair dismissal remedies. Those courts have however exercised jurisdiction to award damages for breach of the implied term if the breach occurs before the dismissal.

The question whether such a term is to be implied into the employment relationship in Australia is due to be determined soon by the High Court in Barker’s case. If it is, the Australian courts will also need to grapple with the damages issue in due course.