A more practical advantage in looking at a contract as the taking of a risk is to be found in the light which it throws upon the measure of damages.  If a breach of contract were regarded in the same light as a tort, it would seem that if, in the course of performance of the contract the promisor should be notified of any particular consequence which would result from its not being performed, he should be held liable for that consequence in the event of non-performance.  Such a suggestion has been made. 1 But it has not been accepted as the law.  On the contrary, according to the opinion of a very able judge, which seems to be generally followed, notice, even at the time of making the contract, of special circumstances out of which special damages would arise in case of breach, is not sufficient unless the assumption of that risk is to be taken as having fairly entered into the contract. 2 If a carrier should undertake to carry the machinery of a saw-mill from Liverpool to Vancouver’s Island, and should fail [302] to do so, he probably would not be held liable for the rate of hire of such machinery during the necessary delay, although he might know that it could not be replaced without sending to England, unless he was fairly understood to accept “the contract with the special condition attached to it.” 1

It is true that, when people make contracts, they usually contemplate the performance rather than the breach.  The express language used does not generally go further than to define what will happen if the contract is fulfilled.  A statutory requirement of a memorandum in writing would be satisfied by a written statement of the promise as made, because to require more would be to run counter to the ordinary habits of mankind, as well as because the statement that the effect of a contract is the assumption of the risk of a future event does not mean that there is a second subsidiary promise to assume that risk, but that the assumption follows as a consequence directly enforced by the law, without the promisor’s co-operation.  So parol evidence would be admissible, no doubt, to enlarge or diminish the extent of the liability assumed for nonperformance, where it would be inadmissible to affect the scope of the promise.

But these concessions do not affect the view here taken.  As the relation of contractor and contractee is voluntary, the consequences attaching to the relation must be voluntary.  What the event contemplated by the promise is, or in other words what will amount to a breach of contract, is a matter of interpretation and construction.  What consequences of the breach are assumed is more remotely, in like manner, a matter of construction, having regard [303] to the circumstances under which the contract is made.  Knowledge of what is dependent upon performance is one of those circumstances.  It is not necessarily conclusive, but it may have the effect of enlarging the risk assumed.