Contracts _ Remedies Flashcards
Legal Remedy:
LEGAL REMEDIES
Money damages
Expectation Damages
LEGAL REMEDIES
- Put plaintiff in position if K had been performed
- “Foreseeable with reasonable certainty”
Formula - Expectation Damages
LEGAL REMEDIES
- (K price) – (Money received/saved) + (Costs)
Reliance Damages
LEGAL REMEDIES
- Put plaintiff in position he would have been prior to K
- Unreimbursed costs
* NO Expectation Damages
Example:
o Jon was going to teach out in California, and now he has unreimbursed costs because he relied on you telling him to come out to California on June 1 to teach a class
Restitution
LEGAL REMEDIES
- Getting back any value you already gave
- Contract PARTIALLY performed
- Measured by market value of the services
Consequential Damages
LEGAL REMEDIES
- Foreseeable costs because of breach
Example:
o You don’t buy Jon’s house, now he has to pay to put it back on the market
Liquidated Damages:
LEGAL REMEDIES
- Determined at time of contract
- Enforced if reasonable
- Not a penalty
Quantum Meruit
LEGAL REMEDIES
The Breaching Party can recover:
* (Reasonable value of services) – (Damages incurred)
UCC Seller Damages: (3+1)
LEGAL REMEDIES
If Buyer breaches, Seller can recover:
* Goods Delivered & Accepted = (K price)
* Some/None goods Delivered = (K price) – (Market price)
* Goods Resold = (K price) – (Resale price)
* Additionally, Incidental Damages
Lost Volume Seller:
LEGAL REMEDIES
- Seller can sell as many widgets as possible
Lost Profits
LEGAL REMEDIES
- (Expected profit) + (Costs) – (Payment for resale)
UCC Buyer Damages: (3)
LEGAL REMEDIES
If the Seller breaches, Buyer can recover:
* Purchased replacement goods = (K price) – (Cost of new goods)
* NO replacement goods = (K price) – (Market price at time of breach)
* (Incidental/Consequential Damages) – (Expenses saved)
Equitable Remedies
EQUITABLE REMEDIES
Recoverable when remedy at law is inadequate
Specific Performance
EQUITABLE REMEDIES
- Court will make a party perform
- For UNIQUE items (ex: LAND)
Injunction
EQUITABLE REMEDIES
- To “prevent irreparable harm”
- Employment contracts
- Trade secrets
- Proprietary information
o You work at McDonald’s, and you are going to
move to Burger King and talk about the secret sauce
Rescission
EQUITABLE REMEDIES
- No meeting of the minds
- Mistake
- Misrepresentation
- Duress
- Lack of capacity
Restitution
Legal Restitutionary Remedies
Restitution is designed ot prevent the defendant’s unjust enrichment. Generally, the measure of damages si the value of the benefit received by the breaching party.
Restitutionary damages are favored when the actual value of the services provided are higher than the contract price.
Replevin
Legal Restitutionary Remedies
A plaintiff may use replevin ot regain personal property when there is a specific piece of property that the defendant wrongfuly took from the plaintiff and the plaintiff has the right of possession. However, the item recoverable in a contract action is the item in the contract.
Reformation
Equitable Remedy
Reformation is an equitable remedy where a court modifies a written instrument to conform to the parties’ previous understanding or agreement. There must be:
(1) a valid prior agreement between the parties;
(2) that fails to conform to the valid prior agreement;
(3) as a result of mistake or fraud; and
(4) both parties believed at the time they executed the contract that the contract reflected their underlying agreement.
