Limitations on K Recovery

Question 1

Mitigation

Answer 1

A plaintiff who has suffered an injury or loss should take reasonable action, where possible, to minimize the loss suffered. The failure of a plaintiff to take protective steps after suffering an injury or loss can reduce the amount of the plaintiff’s recovery.

Question 2

Exclusive Remedy

Answer 2

Contract can specify an exclusive remedy. Inclusion of certain remedies implies exclusion of others. Even if an exclusive remedy turns out to be inadequate (“fails of its purpose”), you cannot substitute alternative remedy absent a showing of unconscionability (Kearney & Trecker). Remember, courts are often reluctant to alter the terms of a valid contract. That said, however, that there is a split in the jurisdictions on substitution of remedies when an express remedy fails. Many jurisdictions will not allow an aggrieved party to be without any remedy at all, and will return to a survey of common law or UCC remedies.

Question 3

Excluding Remedy

Answer 3

Contract can expressly exclude a remedy such as prohibiting consequential damages (Kearney & Trecker) if the parties knowingly bargained for such a provision.
→ Example: Provision in contract states that remedy is limited to repair and replacement of parts and expressly excludes consequential damages. Court will enforce R&R provision, even when such remedy fails its purpose. Court will also enforce prohibition against consequential damages.