Hochster v De La Tour [1853] EWHC QB J72 (25 June 1853)

A courier was hired in April 1852 to commence employment on 1st June 1852. In May, the employer repudiated the contract. The court held the courier could sue immediately for breach without waiting until the performance date. This landmark case established the doctrine of anticipatory breach of contract.

Facts

In April 1852, the defendant engaged the plaintiff, a courier, to accompany him on a tour of continental Europe commencing on 1st June 1852 for three months at a salary of £10 per month. On 11th May 1852, the defendant wrote to the plaintiff stating he had changed his mind and declined his services, refusing to make any compensation. The plaintiff commenced his action on 22nd May 1852, before the contractual start date of 1st June. Between commencing the action and 1st June, the plaintiff obtained alternative employment with Lord Ashburton on equally good terms, commencing on 4th July.

Issues

The central issue was whether a party to an executory contract could bring an action for breach before the date fixed for performance, when the other party had clearly renounced the agreement before that date. The defendant contended that no breach could occur before 1st June 1852, and that the plaintiff was bound to remain ready and willing to perform until that date.

Judgment

Lord Campbell CJ delivered the judgment of the Court, ruling in favour of the plaintiff. The Court held that where one party to a contract renounces it before the time for performance, the other party may treat that renunciation as a breach and sue immediately without waiting for the performance date.

Key Reasoning

The Court reasoned that when parties enter into a contract for future performance, a relationship is constituted between them in the meantime, with an implied promise that neither will do anything prejudicial to the other inconsistent with that relation. Lord Campbell CJ stated that it would be irrational to require the plaintiff to remain idle and incur useless expenses in preparation when the defendant had absolutely declared he would never perform the contract.

The Court observed that allowing the injured party to consider himself absolved from future performance while retaining his right to sue for damages was more beneficial to both parties. The plaintiff could seek alternative employment, which would mitigate damages, rather than remaining idle.

The Court noted that a party who wrongfully renounces a contract cannot justly complain if he is immediately sued for compensation by the injured party. The innocent party has the option either to sue immediately or to wait until the time when the act was to be done.

Implications

This case established the doctrine of anticipatory breach in English contract law. It confirmed that a clear and unequivocal renunciation of contractual obligations before the time for performance gives the innocent party an immediate right of action. The injured party may elect to treat the contract as at an end and sue for damages, or alternatively wait until the performance date. This principle promotes commercial efficiency by allowing parties to mitigate their losses rather than incurring futile expenses in preparation for a contract that will not be performed.

Verdict: Judgment for the plaintiff. The Court held that the defendant’s renunciation of the contract before the performance date entitled the plaintiff to bring an immediate action for breach of contract without waiting until 1st June 1852.

Source: Hochster v De La Tour [1853] EWHC QB J72 (25 June 1853)