Breach of Contract, Compensation and Remedies under Myanmar Laws

By Khaing Thanda Lwin

18^th June 2025

Under Myanmar laws, there are two main status that address the breach of contract and its remedies. The breach of contract is primarily governed by the Contract Act, 1872, especially Sections 73 to 75, which deal with compensation for loss or damage caused by breach of contract.

However, the Specific Relief Act, 1877 also plays an important role in relation to breaches of contract. It does not define a breach or provide compensation like the Contract Act, but it governs what remedies are available to an injured party, especially regarding non-monetary remedies. There are three main kinds of remedies for breach of contract, (i) damages, (ii) a degree for specific performance, or (iii) an injunction.

The law as to damages for the breach of contract and the measure of damages are laid down in Sections 73 to 75 of the Contract Act, 1872. The law regarding the specific performance and injunction are regulated by Sections 12 to 30 of the Specific Relief Act.

 

I. BREACH OF CONTRACT AND COMPENSATION UNDER THE CONTRACT ACT, 1872

The following provisions deal with the breach of contract and compensation available under the Contract Act, 1872.

 

Section 39        Effect of breach of contract willfully caused by a party

“When a party to a contract has refused to perform, or disabled himself from performing, his promise in its entirely, the promisee may put an end to the contract, unless he has signified, by words or conduct, his acquiescence in its continuance.”

 

Section 54 Effect of default as to that promise which should be first performed, in contract consisting of reciprocal promises

“When a contract consists of reciprocal promises, such that one of them cannot be performed or that its performance cannot be claimed till the other has been performed and the promisor of the promise last mentioned fails to perform it, such promisor cannot claim the performance of the reciprocal promise, and must make compensation to the other party to the contract for any loss which such other party may sustain by the non-performance of the contract.”

 

Section 73        Compensation for loss or damage caused by breach of contract

“When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach or which the parties knew, when they made the contract, to be likely to result from the breach of it.

Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach.”

Compensation for breach of contract where penalty stipulated for

“Compensation for failure to discharge obligation resembling those created by contract. When an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it is entitled to receive the same compensation from the party in default as if such person had contracted to discharge it and had broken his contract.”

Explanation:  In estimating the loss or damage arising from a breach of contract, the     means which existed of remedying the inconvenience caused by the non-       performance of the contract must be taken into account.

 

Section 74        Compensation for breach of contract where penalty stipulated for

“When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for.”

Explanation:    A stipulation for increased interest from the date of default may be a stipulation by way of penalty.

 

Section 75        Party rightfully rescinding contract entitled to compensation

“A person who rightly rescinds a contract is entitled to compensation for any damage which he has sustained through the non-fulfilment of the contract.”

 

 II.  REMEDIES FOR BREACH OF CONTRACT UNDER THE SPECIFIC RELIEFS ACT, 1872

Here are some provisions related to remedies for breach of contract under the Specific Reliefs Act, 1872.

 

2.1    RECOVERY OF IMMOVEABLE PROPERTY

Section 8          Recovery of specific immoveable property

“A person entitled to the possession of specific immoveable property may recover it in the manner prescribed by the Code of Civil Procedure. Suit by person dispossessed of immoveable property.”

Section 9          Suit by person dispossessed of immoveable property      

“If any person is dispossessed without his consent of immoveable property otherwise than in due course of law, he or any person claiming through him may by suit recover possession thereof, notwithstanding any other title that may be set up in such suit. Nothing in this section shall bar any person from suing to establish his title to such property and to recover possession thereof. No suit under this section shall be brought against the Government. No appeal shall lie from any order or decree passed in any suit instituted under this section, nor shall any review of any such order or decree be allowed.”

 

2.2    SPECIFIC PERFORMANCE OF CONTRACTS

Section 12        Cases in which specific performance enforceable.

“The specific performance of any contract may in the discretion of the Court be enforced-

(a)       when the act agreed to be done is in the performance, wholly or partly, of a trust;

(b)      when there exists no standard for ascertaining the actual damage caused by non-performance of the act agreed to be done;

(c)       when the act agreed to be done is such that pecuniary compensation for its non-performance would not afford adequate relief; or

(d)      when it is probable that pecuniary compensation cannot be got for the non-performance of the act agreed to be done.”

 

Section 19        Power to award compensation in certain cases

“Any person suing for the specific performance of a contract may also ask for compensation for its breach, either in addition to, or in substitution for, such performance. If in any such suit the Court decides that specific performance ought not to be granted, but that there is a contract between the parties which has been broken by the defendant and that the plaintiff is entitled to compensation for that breach, it shall award him compensation accordingly. If in any such suit the Court decides that specific performance ought not to be granted, but that it is not sufficient to satisfy the justice of the case, and that some compensation for breach of the contract should also be made to the plaintiff, it shall award him such compensation accordingly.”

2.2    PREVENTIVE RELIEFS

“Injunction is used as a means of enforcing a contract or a promise to forbear, where a contract is about to be broken by a party to the contract. Injunctions are of two kinds, namely, temporary or perpetual. Both injunctions are governed by Sections 52 to 57 of the Specific Relief Act.”

 

Section 52        Preventive reliefs how grant

“Preventive relief is granted at the discretion of the Court by injunction, temporary or perpetual. Temporary injunctions.”

 

Section 53        Temporary injunctions

“Temporary injunctions are such as are to continue until a specified time, or until the further order of the Court. They may be granted at any period of a suit and are regulated by the Code of Civil Procedure.”

“Order 39, Rule 1 of the Code of Civil Procedure states that where in any suit it is proved by affidavit or otherwise—

(a)    that any property in dispute in a suit is in danger of being wasted, damaged or alienated by any party to the suit, or

(b)   that the defendant threatens, or intends, to remove or dispose of his property with a view to defraud his creations.

The Court may by order grant a temporary injunction to restrain such act, or make such other order for the purpose of staying and preventing the wasting, damaging, alienation, sale, removal, or disposition of the property as the court thinks fit, until the disposal of the suit or until further orders.”

 

Section 54        Perpetual injunctions when granted

“When the defendant invades or threatens to invade the plaintiff’s right to, or enjoyment of, property, the Court may grant a perpetual injunction in the following cases (namely):-

(a)   where the defendant is trustee of the property for the plaintiff;

(b)   where there exists no standard for ascertaining the actual damage caused, or likely to be caused, by the invasion;

(c)   where the invasion is such that pecuniary compensation would not afford adequate relief;

(d)   where it is probable that pecuniary compensation cannot be got for the invasion;

(e)   where the injunction is necessary to prevent a multiplicity of judicial proceedings.”

Section 55        Mandatory injunctions

“When, to prevent the breach of an obligation, it is necessary to compel the performance of certain acts which the Court is capable of enforcing, the Court may in its discretion grant an injunction to prevent the breach complained of, and also to compel performance of the requisite acts.”

 

Section 57        Injunction to perform negative agreement

“Notwithstanding section 56, clause (f), where a contract comprises an affirmative agreement to do a certain act, coupled with a negative agreement, express or implied, not to do a certain act, the circumstance that the Court is unable to compel specific performance of the affirmative agreement shall not preclude it from granting an injunction to perform the negative agreement; provided that the applicant has not failed to perform the contract so far as it is binding on him.”

 

CONCLUSION

Under Myanmar laws, bearing the liability for breach of contract involves both monetary and non-monetary remedies, as provided under the Contract Act, 1872 and the Specific Relief Act, 1877.

A breaching party may be held liable to pay compensation for loss or damage caused by the breach (Sections 73–75 of the Contract Act); to comply with a court order for specific performance or injunction, compelling or restraining certain actions (Sections 12–30, 52–57 of the Specific Relief Act), and to restore possession in cases involving immovable property (Sections 8–9 of the Specific Relief Act).

Thus, a party who breaches a contract may bear liability by paying damages, performing contractual obligations, or being subject to legal restraints or orders, depending on the nature of the breach and the relief sought by the injured party.

 

REFERENCES

1.        1872,  The Specific Relief Act

2.        1877,  The Contract Act

3.        1909,  The Code of Civil Procedure