General Damages

Question 1

types of standard $ damages

Answer 1

• expectation damages (breach)
• reliance damages (promissory estoppel)
• consequential damages
• incidental damages

NO punitive damages in k

Question 1

expectation damages

Answer 1

puts parties in economic position they would be in if the k had been performed properly
- aka if breach never occurred

Standard measure of money damages

ET: when in doubt, look for answer that most closely gives damaged party what she would have received absent breach

ET: really loook @ what other party expected from k

Question 2

reliance damages

Answer 2

designed to compensate P based on the value of her performance and put P in the position they would have been in had the contract never been formed
- returns nonbreaching party to status quo before k

Use WHEN expectation damages are too speculative

Question 3

consequential damages

Answer 3

foreseeable losses indirectly resulting from breach (eg, lost profits); recoverable if:
1. damages are foreseeable result of breach, and
2. when k was formed, D had reason to know P would suffer special, unpreventable, or unexpected damages in the event of a breach

UCC ks: only buyers can recover

usually lost profits

NOTE: foreseeability matters - these damages ARE recoverable if foreseeable @ time of formation

Question 4

incidental damages

Answer 4

commercially reasonable expenses incurred by non-breaching party in UCC ks
- always recoverable

These are costs that are incidental to the breach and deals w/ breach
- prevents further damages

eg, costs of inspecting, returning, storing, reselling goods

ET: does NOT need to be foreseeable

Question 5

non-monetary remedies

Answer 5

available if money damages are unavailable or inadequate

Question 6

specific performance

Answer 6

equitable remedy: usually only available for ks involving real estate or unique goods (eg, custom made, antiques, art, buyer is unable to uncover, NOTE: all land is unique)
- only available when legal remedy is inadequate

NOT for personal service Ks (can’t force people to work @ place)
- BUT can bar from working for competitors

ET: usually the wrong answer

ET: must first show money damages inadequate + feasible to enforce decree

Question 7

rescission

Answer 7

cancellation of K
- purpose is to restore parties to their positions before k was made

ET: often arises where there is mistake, misrepresentation, duress, or some other defense to k enforcement or formation

Question 8

reformation

Answer 8

remedy whereby k is changed so that it reflects parties’ OG intent

Can arise when:
1. there is a mistake in k formation such that the final k varies from a prior written agreement of parties, or
2. k is inaccurate due to some misrepresentation

Question 9

UCC reclamation

Answer 9

in UCC ks, unpaid sellers may stop delivery or reclaim goods from an insolvent buyer
- insolvent @ time she receives goods and @ time of demand
- unpaid seller generally cannot reclaim goods from subsequent buyers

Question 10

UCC reclamation requirements

Answer 10

seller can get reclamation if:
1. buyer insolvent AND
2. seller demands reclamation w/in 10 days of receipt

Starts w/ credit transaction
Exception: can go past 10 days if buyer misrepresents insolvency in writing w/in 3 months before delivery

Question 11

restitution damages

Answer 11

arises where a party has been unjustly enriched
- award based on value of benefit wrongfully conferred
- fair market value NOT k price

NOTE: party cannot recover both expectation damages and restitution damages

restitution if k failed

Question 12

liquidated damages

Answer 12

agreed upon k provisions that stipulate specified damages upon the occurrence of a breach

Question 13

liquidated damages requirements

Answer 13

liquidated damages provisions are valid only if:
1. damages are difficult to project @ time of k formation, and
2. the provision is a reasonable estimate of actual damages

Question 14

ET: invariable lump sum liquidated damages clause

Answer 14

INVALID clause
-it’s an invalid penalty

Instead: try to get them through expectation damages + reliance damages

Question 15

duty to mitigate

Answer 15

P cannot recover reasonably avoidable damages (but can recover costs for avoiding further damages)
- P must refrain from incurring additional losses after receiving notice of breach
- P may recover the cost of mitigation (ie, cost to avoid incurring further damages)
- D bears the burden of showing P’s failure to mitigate

Question 16

employment & duty to mitigate

Answer 16

P’s damages can be reduced if D can show a comparable job in the same locale was available to P

Question 17

avoidable damages

Answer 17

damages that could’ve been avoided are NOT recoverable
- duty to mitigate is limited to similar/comparable subject matter