Punishment and Disgorgement as Contract Remedies

Abstract

This chapter discusses whether courts are justified in requiring parties who breach their contracts to disgorge their gains or to be subject to punitive damages. Because remedies are the continuation of rights, one must first identify the nature of the right that contract law gives the plaintiff. Accordingly, it presents a contrast between the function that Fuller and Perdue assign to the contract remedy and Kant's now largely forgotten treatment of contract right. The Kantian account casts light on the inaptness of requiring the disgorgement of gains from contract breach. Turning to punitive damages, the chapter outlines how corrective justice and punishment coexist and are differentiated in a legal order based on rights. Finally, it discusses the difficulties that emerge from the elaborate but ultimately unsatisfying attempt by the Supreme Court of Canada to work out a coherent treatment of punitive damages for contract breach.

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