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The modern argument that the law of obligations should be recast in restitutionary terms appears to have achieved its victory over contract in A-G v Blake. Although ritual obeisance to compensatory damages is made, Blake recognises a general restitutionary remedy for breach of contract the logic of which must be to undermine completely the expectation interest. The general effect of restitutionary rather than expectation-based remedies will be to furnish a greater deterrent against breach, a result welcomed by advocates of the ‘performance interest’. All this would be well were all breaches ‘wrongs’ which should be deterred. This, however, is not so. Breach has a positive, indeed essential, role in the operation of the law of contract as the legal institution regulating economic exchange and pursuit of its general prevention is inconsistent with the operation of a market economy. The victory of restitution therefore is illusory: it is impossible that the position established in Blake can be sustained.
Campbell et al. (2002) studied this question.