Legal Damages

Question 1

What are the types of damages?

Answer 1

1. Compensatory damages;
2. Presumed damages;
3. Nominal damages;
4. Punitive damages; and
5. General / Consequential damages.

Question 2

What are compensatory damages?

Answer 2

These damages are designed to provide, “compensation for the injury caused to plaintiff by defendant’s breach of duty, in the form of money.”

IN OTHER WORDS, COMPENSATE PLAINTIFF AND PUT THEM BACK IN THE RIGHTFUL POSITION.

Tort = backward looking
Contract = forward looking

recall with legal remedies (unlike equitable) you have a right to a jury trial (so long as seeking > $20).

Question 3

Assessing compensatory damages for tort claims.

Answer 3

Tort claims look backward. The goal is to put the plaintiff in a position they occupied, “pre-harm.”

Looks at PECUNIARY and NON-pecuniary damages.

Question 4

What are pecuniary damages?

Answer 4

Aka special damages. These are typically easier to quantify than non-pecuniary.

These are based on:

1. Medical bills;
2. Lost wages; or
3. Repair/replacement costs, etc.

Question 5

What are non-pecuniary damages/

Answer 5

General damages, based on:

1. Pain & Suffering;
2. Emotional/Mental Distress;
3. Loss of consortium; or
4. Quality of life

Harder to quantify intangible losses. Typically have caps unlike pecuniary.

Question 6

Assessing compensatory damages for contract claims.

Answer 6

Contract claims look forwards.

Look at EXPECTATION (or reliance) damages AND CONSEQUENTIAL damages.

At minimum, put the non-breaching party in the performance position.

Question 7

What are reliance damages?

Answer 7

Reliance damages attempt to bring the Plaintiff back to the beginning. You are reimbursing the plaintiff for the loss caused by the reliance on the contract and operates by putting the plaintiff in the position as if the contract was NEVER made.

You can have Reliance or Expectation not both.

Question 8

What are expectation damages?

Answer 8

These damages attempt to put the plaintiff in the performance position.

Expectation damages look at what the P would have received (aka THE BENEFIT OF THE BARGAIN) in contract claims.
Based on:
1. Direct losses due to violation/breach; and
2. P’s position if there had been no breach and both parties fully performed.

Question 9

What are consequential damages?

Answer 9

Also known as special damages. These damages are secondary and result from D’s violation.
Based on:
1. Loss of operating revenue due to a delay in construction;
2. Harm to a company’s business reputation;
3. Loss of time; AND
4. Loss of profit

The UCC allows limiting or excluding consequential damages unless it would be unconscionable.

Question 10

What are presumed damages?

Answer 10

These are a SUBSTITUTE for ordinary compensatory damages, not a supplement for an award that fully compensates the alleged injury.

These damages are awarded when there has been an injury that is LIKELY TO HAVE OCCURRED but DIFFICULT TO ESTABLISH.

1. You proved there was a violation;
2. Harm resulted (not necessary); and
3. You cannot quantify the amount of damage.

Cannot have both presumed and compensatory damages.

Question 11

What are nominal damages?

Answer 11

A trivial sum of money (frequently one dollar) awarded to plaintiff who have established a CoA but have not shown an injury which compensatory damages can be awarded.

Similar elements of presumed damages.

Question 12

What are punitive damages?

Answer 12

These damages are designed to PUNISH THE DEFENDANT for its wrongdoing.

There must be an actual loss (such as nominal damages).

In tort cases, there needs to be intentional conduct. (typically barred in contract cases until the BoC result in a tort).

Want to go beyond the rightful position.

These are called exemplary damages in CA.

Question 13

What happens when two or more remedies are concurrently available?

Answer 13

The plaintiff must choose one and they are bound by that choice.

Question 14

What are ways of collecting money judgments?

Answer 14

1. Execution – can attach judgment to defendant’s property (aka judgment lien).
2. Turnover statutes – require defendant to turn over non-exempt property that is not otherwise easily reachable through execution.
3. Garnishment – directs 3rd party to pay directly to plaintiff.
4. Attachment – freezes defendant’s assets prior to and during the pendency of the litigation to prevent dissipation of assets needed to satisfy a potential adverse judgment.

Question 15

Limitations on compensatory damages?

Answer 15

To receive compensatory damages, the plaintiff must prove the damages are:
1. foreseeable; 2. certain; and 3. unavoidable.

Question 16

What is foreseeability?

Answer 16

Compensatory damages are foreseeable if it is reasonable for the defendant to believe or have reason to know that the harm can stem from their conduct.

General damages are foreseeable by definition. (generally has no CAP.)

Consequential damages require the plaintiff to prove foreseeability.

Contract foreseeability
1. breach is in ordinary course of events and/or;
2. the breach arose as a result of special circumstances, beyond ordinary events, that the party in breach had reason to know.

Tort foreseeability
1. apply proximate cause test … as long as harm reasonably FORESEEABLE that they will be responsible for entire extent of harm.
THIN-SKULL RULE EXCEPTION
if the plaintiff has some particular (physical) weakness or susceptibility, the extent of their harm can increase regardless of foreseeability.

Question 17

What is certainty?

Answer 17

Certainty requires plaintiff to prove:
1. it is reasonably certain or probable that it suffered a loss BUT FOR DEFENDANT’s CONDUCT; AND
2. provide the jury w/ evidence that the amount of its loss can be established with reasonable certainty.

MAJORITY RULE:
must prove that 51% or greater chance that the harm and future harm will occur, based on the conduct.

Question 18

What is unavoidable?

Answer 18

Plaintiff may not recover damages for any losses that could have reasonably been avoided AFTER the harm resulted.

Question 19

Economic Loss Factors

Answer 19

The harm is measured at the time of loss.

Courts look at the following:

1. Market Value
   – what is reasonable buyer willing to pay?
   – animal negligently killed exception == consider animal’s FMV at time of LOSS plus interest AND any other NON-SENTIMENTAL considerations such as breeding potential, training, medical expenses etc.
   (this is an exception because you are generally capped at the FMV.)
2. Replacement Costs
   – the price needed to pay to replace the loss on the market.
3. Personal Value
   – personal value ascribed to the thing (generally not allowed).
4. Repair Costs
   – amount required to repair damages or to restore loss to pre-harm condition.
5. Use Value AND
   – loss in use of the property. (period of loss must be reasonable). (focus is on what the property would have been used for).
   (this is the only measurement that can be coupled with another).
6. Diminution in Value
   – how did the harm effect the value of the item?

MRPRUDe

Question 20

Can you have multiple economic loss factors at once?

Answer 20

Each Loss Should Only Have One Measure.

The only measure you can use with another one is the USE VALUE.

FMV is the preferred measurement.

Question 21

Types of contract Consequential Damages

Answer 21

1. UCC incidental damages (these are easily recoverable pecuniary damages)
2. Liquidated damages – these are agreed to in the contract, they should be a reasonable estimate of the actual damage. IF greater than the actual damages, then the provision will hold so long as the amount was reasonable at the time the contract was entered into.

Question 22

Treble damages

Answer 22

Treble damages are a type of compensatory damage. They are based in statute and permit or require a court to triple (3x) or double (2x) the compensatory damages awarded. They can have a punitive impact by entering the offender.

Question 23

Punitive Damages Requirements.

Answer 23

1. Is there a parasitic element?
   Requirements: Can the punitive damages attach to other damages (typically compensatory – could also be nominal).
2. What is the claim?
   Can have punitive damages only in TORT claims. (some contract claims like fraud, breach duty of good faith, tortious interference w/ contract are eligible).
3. What is D’s state of mind?
   Degree of blameworthiness.Intentional = Malice (“mal intent”)Reckless = Conscious DisregardMUST BE MORE THAN MERE NEGLIGENCE.
4. Vicarious liability?
   The principal may be liable for the punitive damages if there is a vicarious liability relationship.

Question 24

Measuring Punitive Damages

Answer 24

Jury determines the initial amount. The court then reviews to see if the amount SHOCKS THE CONSCIOUS…Is it rational or based on “passion or prejudice?”

If court finds punitive damages are excessive, court will order a remittur.

Execsiveness Factors are:
1. Reprehensibility;
2. Ratio;
3. Wealth of Def;
4. Other sanctions;
5. Profits of D;
6. Other plaintiffs;
7. Litigation costs

Question 25

Punitive Damages EXCEPTIONS

Answer 25

Punitive damages not available in:
1. Actions against municipalities, union;
2. Statutory Exclusions (e.g., not allowed under the ADA);
3. 29 states do not allow for this.