Tort Distinguished from Breach of Contract and Other Wrongs

The carrier. A passenger with a ticket may sue on the contract of carriage or in negligence. A passenger without one, or a pedestrian, has only the tort.

The builder. A buyer of a flat may sue on the agreement to sell, and, if the building collapses on a passer-by, that passer-by sues only in tort.

Which to choose is a practical question: the tort claim escapes privity and may give a wider measure of damages; the contract claim may be easier to prove because the term is written down.

The other two wrongs the syllabus mentions

Breach of trust. A trust arises where property is held by one person for the benefit of another. The obligation is equitable and it is owed to the beneficiary alone. The remedy is an account and restoration of the trust property, and the amount is ascertained rather than assessed at large, which is why Salmond's definition puts breach of trust outside tort along with breach of contract.

Quasi-contract. A quasi-contract is an obligation imposed by law where there is no agreement at all, so that a person who has received a benefit at another's expense must restore it. Sections 68 to 72 of the Indian Contract Act 1872 contain the Indian examples: necessaries supplied to a person incapable of contracting, payment by an interested person, benefit of a non-gratuitous act, finder of goods, and money paid by mistake or under coercion. It resembles tort in that the law imposes the obligation, and differs from it in that the claim is for a definite sum representing the benefit received, not for damages the court assesses.

A worked example

Ashok books a taxi through an app. The driver, Bipin, drives carelessly and collides with a wall. Ashok is injured, so is Chandra who was standing on the footpath, and so is Deepa who had accepted a free ride from Ashok.

Ashok has a contract of carriage. He may sue for breach of it, and the measure will be governed by section 73 of the Indian Contract Act 1872. He may instead sue in negligence, and he may also complain to a Consumer Commission, because section 2 of the Consumer Protection Act 2019 makes a person who hires a service for consideration a consumer and gives him a remedy for deficiency.

Chandra has no contract with anybody. She sues in negligence, and privity is no obstacle because the duty of care is owed to every road user.

Deepa paid nothing and has no contract either. She too sues in negligence. The fact that she travelled free does not reduce the duty owed to her, though it may be relevant to a plea of consent, which chapter [Volenti Non Fit Injuria] deals with.

And Bipin's employer may be liable for all three without having done anything himself, on the principles in chapter [Vicarious Liability: Basis and Justification].

One accident, three plaintiffs, and the source of the duty decides who may sue on what.

What it does NOT mean

It does not mean a plaintiff must choose one and abandon the other. He may plead both in the alternative. What he cannot do is recover the same loss twice.

It does not mean a contract can never create a tortious duty. The relationship created by a contract is often what brings the parties into proximity, and the duty of care then arises independently of the contract's terms.

It does not mean an exemption clause is worthless in tort. A term may operate as consent, and consent is a defence in tort, but the clause has to be proved and its scope is construed strictly.

It does not mean quasi-contract is a kind of contract. There is no agreement in it at all; the name is historical.

Quick revision

1. Contract: duty fixed by the parties, owed to a determinate person, right in personam, privity required.
2. Tort: duty fixed by law, owed to persons generally, right in rem, no privity.
3. Damages in contract are assessed under section 73 of the Indian Contract Act 1872, which excludes remote and indirect loss.
4. Damages in tort are unliquidated and are fixed by the court.
5. Section 2(m) of the Limitation Act 1963 says a tort is a civil wrong not exclusively a breach of contract, which is what allows the same facts to give both.
6. Breach of trust is an equitable obligation owed to the beneficiary; the remedy is restoration, not damages at large.
7. Quasi-contract, sections 68 to 72 of the Indian Contract Act 1872, is an obligation imposed by law to restore a benefit; the claim is for a definite sum.
8. A consumer may now have a third route under the Consumer Protection Act 2019.

Test yourself

1. Distinguish a tort from a breach of contract. In a breach of contract the duty broken was created by the parties' own agreement, is owed only to the other party, and corresponds to a right in personam; privity is therefore essential and a stranger to the contract cannot sue. In a tort the duty is imposed by the law, is owed to persons generally, and corresponds to a right in rem; no privity is needed and a stranger may sue. Damages in contract are liquidated or are assessed under section 73 of the Indian Contract Act 1872, which allows loss naturally arising in the usual course of things or in the parties' contemplation and excludes remote and indirect loss; damages in tort are unliquidated and are assessed by the court. The same facts may give both, because section 2(m) of the Limitation Act 1963 defines a tort as a civil wrong which is not exclusively a breach of contract.

2. Can the same act be both a tort and a breach of contract? Illustrate. Yes. A surgeon who operates carelessly on a paying patient breaks the contract of treatment and also commits the tort of negligence; a carrier who injures a ticketed passenger breaks the contract of carriage and commits negligence. The plaintiff may sue on either, or plead both in the alternative, but cannot recover the same loss twice. The choice matters: the contractual measure under section 73 excludes remote loss, and the tortious claim escapes privity, so a companion travelling free or a pedestrian can sue only in tort. In India a consumer may also complain to a Consumer Commission, since section 2 of the Consumer Protection Act 2019 gives a remedy for deficiency in a service hired for consideration.

3. Write a short note on quasi-contract and its relation to tort. A quasi-contract is an obligation imposed by law where there is no agreement, so that a person who receives a benefit at another's expense must restore it. The Indian examples are in sections 68 to 72 of the Indian Contract Act 1872: necessaries supplied to a person incapable of contracting, payment by a person interested in a payment, benefit of a non-gratuitous act, the liability of a finder of goods, and money paid by mistake or under coercion. It resembles a tort in that the law and not the parties creates the obligation. It differs in that the claim is restitutionary and is for a definite sum representing the benefit received, whereas a claim in tort is for unliquidated damages representing the plaintiff's loss.

4. Why is privity important in contract and irrelevant in tort? Because the two duties have different sources. A contractual duty exists only because the parties agreed to it, so only a person who was party to that agreement can complain of its breach; that is what privity means. A tortious duty is imposed by the law on everybody in a given position, so the class of people who may complain is defined by who was foreseeably affected, not by who signed anything. The practical consequence appears in every road accident: the ticketed passenger may choose between contract and tort, while the pedestrian has only tort, and both recover.