Contracts: Remedies

Question 1

Remedies

Answer 1

Breached the contract – what is the result?
Damages
Equitable Remedies
Quantum Meruit

Question 2

Damages

Answer 2

monetary award to compensate an injured party for the loss caused by the other party’s breach of contract

Question 3

Purpose of damages

Answer 3

place the injured party in the position they would have been in had the contract been performed

Question 4

Concept of mitigation

Answer 4

• action by an aggrieved party to reduce the extent of its loss caused by the breach of the other party
• Requirement is reasonable mitigation – (buy similar products for the same price or cheaper means no damages)

Question 5

Causation

Answer 5

damages must be casually connected to the breach of contract (but for test)

Question 6

Special Circumstances

Answer 6

breaching party may not be held liable for additional damages arising from special circumstances, where the breaching party was not made aware of them

Question 7

Test for Special Circumstances

Answer 7

from past experience and knowledge between the parties, and taking into account trade usages, should the parties have reasonably expected the loss at the time of the contract formation

Question 8

Measurement of Damages

Answer 8

In most cases, you are entitles to expectation damages, consequential losses, and general damages

Question 9

Expectation Damages

Answer 9

• expected profits under the contract at the time of the contract formation (positon you in the same place if the contract occurred)
• Opportunity cost: lost your chance of making a similar contract with a different promiser, so should be entitled to your profits

Question 10

Consequential Loss

Answer 10

other reasonably foreseeable damages that flow from the breach (ex – shutting down business operations)

Question 11

General Damages

Answer 11

damages that are not quantifiable (lost reputation, loss of goodwill)

Question 12

Reliance Damages

Answer 12

damages for wasted effort

Question 13

Liquidated Damages

Answer 13

an amount agreed to be paid in damages by a party to a contract if it should commit a breach.

Question 14

Nominal Damages

Answer 14

where loss sustained is negligible

Question 15

Problems in measuring damages

Answer 15

mental anguish
wrongful dismissal
loss enjoyment

Question 16

Equitable Remedies
- courts of equity

Answer 16

• court orders other than money settelments
• Where damages are not sufficent
• Can order a party to perform the contract (specifc performance)

Question 17

Discretionary

Answer 17

• Must come with “clean hands” – convince the courts you have not done anything wrong within the case (you have not breached the contract)
• Action must be brought within reasonable time
• No innocent 3rd party can be affected
• Consideration must be commensurate with promise

Question 18

Specific Performance

Answer 18

• an order requiring a defendant to do a specific act; usually to complete a transaction
• Almost never granted in employment or personal service contracts
• Greek property case

Question 19

Injunctions

Answer 19

• A court order restraining a party from acting in a particular manner
• Need for a negative covenant in the K
• Injunctions are rare in employment contracts

Question 20

Quantum Merit

Answer 20

• the amount a person merits to be paid for goods or services provided to the person requesting them
• Is an exemption to the general rule that expectation damages are to apply
• Exemption occurs when there is a wrongful termination of the contract

Question 21

Enforcing a judgement
what Is a judgement

Answer 21

a court order requiring one party to pay the damages, or perform as per an equitbale remedy

Question 22

The parties

Answer 22

Judgment Creditor – owed money back
Judgment Debitor – person who owes money

Question 23

Steps to seize assets of the JD

Answer 23

• Judgment must be registered with the court
• Writ must be filed with Sheriff’s office
• Execution order must be made to the Sheriff; and then
• The sheriff can levy execution – seizes and sells assets for the benefit of all execution creditors
• Some assets are exempt from seizures (pensions/ annuites)

Question 24

Sheriff’s Office

Answer 24

• Must pay out all secured creditors first
• Takes a percentage of sheriff’s fees
• Difference remaining is paid pro rata amongst all of the execution creditors

Question 25

Other processes:

Answer 25

Garnishment order (bank account/ wages/ AR)
Filed with Sheriff’s office, payments made to Sheriff, and sheriff distributes to execution creditors