Consequential and Incidental Damages; Unrecoverable Loss - Mar. 29 Flashcards
What is the intent of awarding monetary damages for breach of contract? (DeLong)
An award of monetary damages for breach of contract is intended to give the non-breaching party the financial equivalent of full performance on both sides. (404)
What do direct or general damages compensate for? (DeLong)
Direct or general damages compensate for harm that arose automatically from the breach and would be the same for all plaintiffs. Direct damages are also those that would occur as a result of a breach in the usual course of events or under ordinary circumstances. (404)
Ex: harm caused by a change in the price of the goods in a sales contract.
What do consequential damages compensate for? (DeLong)
Consequential damages compensate for harm or loss that arose as a result of plaintiff’s individual circumstances, including harm to his person or property as well as costs he incurred or income he lost. (404)
How does one recover for consequential damages? (DeLong)
In order to recover for this kind of loss or injury, a plaintiff must prove that the breach was the cause-in-fact of consequential damages. He must also prove that, at the time the contract was formed, the defendant could have foreseen such harm as the likely consequence of breach. (404)
What do incidental damages from a seller’s breach include? (UCC)
Incidental damages resulting from the seller’s breach include expenses reasonably incurred in inspection, receipt, transportation and care and custody of goodsrightfully rejected, any commercially reasonable charges, expenses or commissions in connection with effecting cover and any other reasonable expense incident to the delay or other breach. (2-715)
What do consequential damages from a seller’s breach include? (UCC)
Consequential damages resulting from the seller’s breach include:
(a) any loss resulting from general or particular requirements and needs of which the seller at the time of contracting had reason to know and which could not reasonably be prevented by cover or otherwise; and
(b) injury to person or property proximately resulting from any breach of warranty. (2-715)
When may loss be foreseeable as a probable result of a breach because it follows from the breach? (R)
(a) in the ordinary course of events, or
(b) as a result of special circumstances, beyond the ordinary course of events, that the party in breach had reason to know. (351)
If a breach delays the use of property and the loss in value to the injured party is not proved with reasonable certainty, what may he recover? (R)
If a breach delays the use of property and the loss in value to the injured party is not proved with reasonable certainty, he may recover damages based on the rental value of the property or on interest on the value of the property. (348)
If a breach results in defective or unfinished construction and the loss in value to the injured party is not proved with sufficient certainty, what may he recover? (R)
If a breach results in defective or unfinished construction and the loss in value to the injured party is not proved with sufficient certainty, he may recover damages based on:
(a) the diminution in the market price of the property caused by the breach, or
(b) the reasonable cost of completing performance or of remedying the defects if that cost is not clearly disproportionate to the probable loss in value to him. (348)
If a breach is of a promise conditioned on a fortuitous event and it is uncertain whether the event would have occurred had there been no breach, what may the injured party recover? (R)
If a breach is of a promise conditioned on a fortuitous event and it is uncertain whether the event would have occurred had there been no breach, the injured party may recover damages based on the value of the conditional right at the time of breach. (348)
Are damages recoverable for loss beyond an amount that the evidence permits to be established with reasonable certainty? (R)
No. Damages are not recoverable for loss beyond an amount that the evidence permits to be established with reasonable certainty. (352)
When can an injured party recover for emotional damages? (R)
Recovery for emotional disturbance will be excluded unless the breach also caused bodily harm or the contract or the breach is of such a kind that serious emotional disturbance was a particularly likely result. (353)
Do contract damages compensate the injured party for attorney’s fees? (DeLong)
No. (407)
