It is the duty of the injured party to mitigate damage suffered as a result of the breach of contract by the other party. He must use all reasonable means of mitigating the damage, just as a prudent man would, under similar circumstances in his own case. He cannot recover any part of the damage, traceable to his own neglect to mitigate.
The onus of proof, however, is on the defendant to show that the plaintiff has failed in his duty of mitigation and the plaintiff is free from the burden of proving that he tried his best to mitigate the loss (Pauzu Ltd. vs Saunders).
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ADVERTISEMENTS:
Illustrations:
(a) Where a servant is dismissed, even though wrongfully, it is his duty to mitigate the damages by seeking other employment. He can recover only nominal damages if he refuses a reasonable offer of fresh employment.
But if it cannot be proved that he has failed in his duty of mitigation, he will be entitled to the full salary for the whole of the unexpired period of service, if the contract of employment was for a fixed period.
If the contract of employment was not for a fixed term, then the principle of awarding damages for a reasonable period of notice comes into play (S.S. Shetty vs Bharat Nidhi Ltd.).
ADVERTISEMENTS:
(b) A took a shop on rent from B and paid one month’s rent in advance. B could not give possession of the shop to A. A chose to do no business for 8 months though there were other shops available in the vicinity
A sued B for breach of contract and claimed damages for the loss suffered. Held, he was entitled only to a refund of his advance, and nothing more, as he had failed in his duty to minimise the loss by not taking another shop in the neighbourhood (Neki vs Pribhu).