American hip hop and rap artist Flo Rida (also known as Tramar Dillard) failed to attend the ‘Fat As Butter’ music festival in Newcastle in October 2011 (having slept in), and failed to appear in the NSW District Court for the hearing and judgment in a breach of contract case filed against him and his Australian agent by the promoter as a result of the ‘no show’. Senior Associate, Mitch Coidan discusses the judgment, which illustrates the availability of damages for future loss, in appropriate cases.

The decision delivered on 3 August 2012 by District Court Judge Gibson in Mothership Music Pty Ltd v Darren Ayre (trading as VIP Entertainment & Concepts Pty Ltd) and Flo Rida (also known as Tramar Dillard) (no. 2) [2012] NSW DC 111, found Flo Rida and his Australian agent liable to pay festival organisers more than $400,000 in damages and legal costs for the ‘no show’.

Flo Rida had already received much attention for his failure to make any appearances in the case, giving rise to the Court granting the promoters leave to file the proceedings on him via social media site Facebook, of which Flo Rida was an avid user.

In addition to an order requiring Flo Rida to repay the $55,000 performance fee he had accepted to perform the one hour set, Flo Rida and his Australian agent, Darren Ayre, were also ordered to pay damages arising out of Flo Rida’s breach of contract and the consequential damage caused to the promoters reputation which ultimately resulted in loss of revenue (from poor ticket sales and lost sponsorship for the 2012 event).

The promoters claimed that their immediate damages, as a result of Flo Rida having not attended the concert, was the loss of 10,000 patron hours (lost food and beverage sales) resulting from 2,000 people having left the venue in disappointment at the ‘no show’.

In addition to the immediate losses experienced by the promoter on the day, the ‘no show’ by Flo Rida was held by the Court to have damaged the trading reputation of the promoters, affecting its ability to stage future events, attract patrons and compete with others in the music event industry. In addition, sponsors were lost as news of the ‘no show’ spread via social media including Facebook, Twitter and You Tube.

Australian and English courts have long recognised the ‘in principle’ right to be awarded damages for loss of reputation caused by a breach of contract. The case is, however, an interesting look at the circumstances in which unrealised damages may be awarded by a court in NSW for future losses anticipated to be incurred as a result damage to reputation arising from breach of contract.

In the present case, the loss of reputation and damage to the trading reputation of the promoters of the 2011 Fat As Butter Festival arose as a result of the impact of a ‘no show’ by the main attraction, Flo Rida, at the 2011 festival, which impacted adversely upon the promoters reputation for staging such events and procuring the attendance of prominent artists at the 2012 festival.

Her Honour held that it was immaterial that at the time of judgment the exact value of the loss could not be proved with precision. Further, that the evidence tendered in relation to the immediate effects of Flo Rida’s “no show” at the Fat As Butter 2011 Festival had a significant impact not only upon the promoters’ profits from the 2011 concert year, but would reasonably be anticipated to cause damage in relation to its proposed planning of the same annual concert in 2012.

The case is a salutary lesson to those who ignore their contractual obligations that the loss for which they are ultimately liable may be much higher than they first thought.