Gains Based Remedies: the misguided search for a doctrine

Abstract

ADVANCE ACCESS In this article Tom Stafford (Paralegal at Clyde & Co LLP) examines the phenomenon of “Gains Based Remedies”. These are awards that, unlike classical damage awards which are calculated by reference to the loss suffered by the claimant, correlate to the gain made by the defendant. A couple of common examples include an account of profits for breach of trust claims, or the “disgorgement” damages that were awarded in AG v Blake . These awards are however available for a spectrum of varied wrongs. Their seeming lack of unity has often baffled commentators who have tried to search for an underpinning doctrine. One particularly renowned commentary is that of Professor Edelman’s, who suggests that these wrongs can be understood by being broken down into one of two categories: awards which seek to deter wrongdoing, and awards which reverse a wrongful transfer of value. The purpose of this article is to discuss the flaws of this view of the law, and to suggest that in fact, any search for a doctrinal underpinning to Gains Based Remedies is misguided. The cases in which these awards are granted have only one feature common to all: the claimant’s loss is, for whatever reason, difficult or impossible to assess. For that reason, the courts use the only other measure of the wrong available: the defendant’s gain.