Contracts Flashcards
Different measures of expectation damages
One measure of damages is the cost of restoration.
Often, where the cost to restore is many times greater than the difference in value of property in its unrestored condition, damages are measured by the difference in value.
Court are split on which measure to use. If the breach is willful and only the completion of the contract will enable the nonbreaching party to use the land for its intended purposes, the cost of completion may be considered the appropriate damage award.
Consequential damages
Consequential damages consist of losses beyond those covered by the standard measure that a reasonable person would have foreseen would occur as a result of the breach.
Often the availability of consequential damages turns on the breaching party’s awareness of the other party’s circumstances.
Damages must be foreseeable and ascertainable with reasonable certainty. Damages are foreseeable if a reasonable person in the position of the breaching party would have known at the time the contract was made that the damages were likely to occur as a result of the breach.
Reduction in damage award for expenses saved
Contract damage awards must take into account costs avoided because of the breach.
Avoidable damages
A nonbreaching party cannot recover avoidable damages; i.e., if he does not make reasonable efforts to cut losses after breach, he will not be permitted to recover those damages that might have been avoided.
