Remedies

Question 1

What is the general remedy for breach of contract?

Answer 1

expectation damages: aggrieved party will be entitled to the amount that will restore him to the position he would have been in had the K been fully performed

Question 2

In what situations may the aggrieved party to a contract not be able to recover the full amount of expectation damages?

Answer 2

(1) expectation damages can’t be calculated w/ reasonable certainty
(2) damages are unforeseeable
(3) where damages can be mitigated

Question 3

What are reliance damages?

Answer 3

Designed to restore the aggrieved party to the position he was in prior to the K

Question 4

What are restitutionary damages?

Answer 4

The value of benefits conferred upon the other party in the transaction

Question 5

How is restitution calculated?

Answer 5

It’s by the court’s discretion and as justice requires by either:

(1) reasonable value or cost of benefits conferred; OR
(2) the extent to which the other party’s property has increased in value b/c of the performance rendered

Question 6

What is the limitation on restitution?

Answer 6

They are available if the aggrieved party has partially performed by NOT if the party has fully performed

Question 7

When are liquidated damages provisions enforceable?

Answer 7

if court finds it to be valid liquidated damages clause designed to compensate for breach

Question 8

When are liquidated damages provisions NOT enforceable?

Answer 8

if court finds it constitutes a penalty designed to punish a breach

Question 9

What is the liquidated damages test?

Answer 9

Two primary prongs, either can uphold the clause:

(1) was the clause reasonable at the time of contracting in relation to ANTICIPATED harm
(2) was the clause reasonable in relation to the harm and losses that ACTUALLY occurred due to the breach?

Question 10

For a seller recovering monetary damages after the buyer has breached, what can the seller recover if they have resold the goods?

Answer 10

Damages are the difference b/w K price and resale price

Question 11

For a seller recovering monetary damages after the buyer has breached, what can the seller recover if they have NOT resold the goods?

Answer 11

Damages are the difference b/w the K price and market price

Question 12

What is a lost volume seller and what can they recover?

Answer 12

Supply of goods exceeds the demand. Can get the profit they would have made on the sale

Question 13

For a buyer recovering monetary damages after the seller has breached, what can the buyer recover if they have COVERED the goods?

Answer 13

Difference b/w K price and cover price

Question 14

For a buyer recovering monetary damages after the seller has breached, what can the buyer recover if they have NOT COVERED the goods?

Answer 14

Difference b/w K price and market price

Question 15

Wha are the damages for a buyer recovering monetary damages when the buyer receives and accepts nonconforming goods from the seller?

Answer 15

Buyer is entitled to recover the difference between value of the goods contracted for AND value of the goods received

Question 16

What are incidental damages?

Answer 16

Available to buyer or seller. The expenses incurred in either seller dealing with the goods after buyer’s breach (e.g., storing them) or buyer arranging for cover (e.g., transportation costs)

Question 17

What are consequential damages?

Answer 17

damages that were reasonably foreseeable to the seller at the time the contract was entered into

Question 18

Under the UCC, who can get consequential damages?

Answer 18

the BUYER

Question 19

When is specific performance available?

Answer 19

when the monetary award is inadequate. usually two situations:

(1) unique objects
(2) real property

Question 20

What equitable remedies are available?

Answer 20

(1) specific performance

(2) negative injunctions

Question 21

When is specific performance not available?

Answer 21

(1) personal services (b/c that would be involuntary servitude)
(2) long-term relationships

Question 22

What is a negative injunction?

Answer 22

Orders prohibiting party from doing something

Question 23

In terms of negative injunctions, what is mid-term relief?

Answer 23

When an employee is under K for a specific period of time and breaches by departing before the end of that period, a negative injunction will be available, even absent a K prohibition, to prevent competing if employee’s services are UNIQUE or EXTRAORDINARY (pro athletes and entertainers)

Question 24

In terms of negative injunctions, what is post-employment relief (covenant not to compete)?

Answer 24

K provision that prohibits post employment competition

Question 25

What 3 factors determine the validity of a covenant not to compete in an employment K?

Answer 25

(1) significant business justification
(2) scope must be reasonable in duration and geographical reach
(3) is there an express provision

Question 26

When is restitution available absent a breach of contract?

Answer 26

benefits conferred under a FAILED contract (b/c of incapacity, fraud, duress, etc.)

Question 27

What is unjust enrichment?

Answer 27

A party that confers benefits on another may recover their value where it is unjust for the recipient to retain the benefits without paying, even absent any express or implied-in-fact K. Two recurring situations where recovery has been held appropriate:

(1) Medical services provided by a medical professional; and
(2) Benefits conferred by mistake to one who availed himself of the benefits at issue