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PRINCIPLE: Damage without the violation of a legal right is not actionable in a court of law. If the interference with the rights of another person is not unlawful or unauthorised, but a necessary consequence of the exercise of defendant’s own lawful rights, no action should lie.
FACTS: There was an established school (ES) in a particular locality. Subsequently, a new school (NS) was set up in the same locality which charged lower fees, on account of which people started patronising the new school. Because of the competition, ES had to reduce its fees. ES filed a case against NS saying that NS had caused it financial loss and, thus, claimed compensation.
Which of the following derivations is CORRECT?
Since no legal right of ES has been violated, therefore, as such, no compensation could be granted.
Since damage is caused to ES, therefore, it should be awarded compensation.
ES should be awarded compensation as opening of school in competition is not good.
No compensation could be granted, as reduction in fees is good for the public.
No legal right has been violated. ES has an equal right to earnings as NS. As for NS being established in the vicinity of ES, instead of looking at the fact that ES had already been running, the courts would actually be supportive of the competitive environment; secondly, if NS can charge lower, and therefore, function with less money, then why not ES? After all, they’re providing the same service!
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