Remedies Flashcards
Limits on Remedies (ALWAYS BEGIN WITH THIS)
Damages must be causal, certain, foreseeable, unavoidable
Always duty to mitigate
Punitive Damages
Punitive damages are available to punish the defendant where their actions were particularly reprehensible (tort) or willful and wanton (k)
Punitive damages must be proportionate to compensatory damages (no more than 10x).
Contract Damages
Breach of K
Restitution
Legal restitution in the form of money will be awarded where a party has been unjustly enriched.
If money damages are not awarded, legal restitution will be available in the amount that the defendant was unjustly enriched.
Calculated based on the benefit to the breaching party.
P cannot recover both restitution and compensatory damages
Can take form of money, CT, EL
Equitable Lien (Equitable Rem)
An equitable lien is an equitable remedy that a court may order to attach to some piece of property. See tracing.
Can be stock
EL Tracing
In order for a court to attach an equitable lien on a piece of property, the plaintiff must be able to adequately trace their interest to that property.
Funds in excess of investment = tracing likely successful
Constructive Trust (Equitable Rem)
A constructive trust is an equitable remedy that a court may order over a specific piece of property.
Contract Remedies
Must be actual, foreseeable, certain (not speculative), and unavoidable.
Plaintiff has duty to mitigate damages to extent mitigation is possible.
Compensatory Damages in Contract/Expectation
CD in contract put a party in the position they would have been in if the contract had been performed or if no breach occured (Expectation)
Reliance Damages
RD puts a non-breaching party in the same position they would have been in if no contract had been formed and reimburses them for any costs that they incurred as a result of the breach
Specific Performance (Equitable Rem)
I V P F D
In order for there to be SP, there must be a breach of k. SP is an equitable remedy that the non-breaching party can seek in an attempt to enforce the contract and have the court require the breaching party to perform their promise.
(Go into governing law, valid k, breach)
To grant:
- inadequate remedy at law
- valid k
- conditions performed by P or ready to perform
- feasible for the court to order relief
- no defenses
Reformation + Grounds
Reformation is an equitable remedy that allows courts to “rewrite” a k to reflect the actual intent of the parties. Court must be satisfied that there was valid k and grounds for reformation
Also, consider validity of the modification to k
Preliminary Injunction
A preliminary injunction is an equitable remedy granted by the court to keep up the status quo until a trial on the merits of the case. It is the next step above a TRO.
Petitioner must show irreparable harm if not granted, the likelihood of success on merits, balance of the hardships, an inadequate legal remedy, posting bond, notice, and no defenses
Notice: unlike TRO, needs notice and an opportunity to be heard at the hearing
Bond: to cover any losses just in case does not win on merits
Compensatory in Contract
Compensatory damages are measured by the non-breaching party’s expectation (i.e. cost of alternate performance or benefit of the bargain)
Temporary Restraining Order
Used to maintain the status quo and for the P to prove that he will suffer immediate farm if the court does not grant an immediate injunction.
Generally given to plaintiffs that can show that irreparable harm will be caused if the restraining order isn’t given and a likelihood of success on the merits. The court will also balance the hardships. Talk about inadequate damages
The party that seeks TRO will likely need to post bond
Fed law: valid for 14 days
D needs to be aware of TRO but P needs to state why
Mention defenses
Remedies for LSK
Remedies for land sale contracts must be foreseeable, causal, certain, and unavoidable
Rescission + Grounds
Contract
Rescission is the avoidance of a k so as to put the parties in the place they were immediately before the k. A court will only grant rescission if the party has the grounds to seek it and there must not be any defenses to the granting of it.
A party may seek to rescind a contract for a variety of reasons including mutual mistake, unilateral mistake, or fraudulent misrepresentation.
Usually followed by Restitution
Incidental Damages
If party incurred any costs as a result of the breach
Equity will not… (defenses)
…reward those who have unclean hands
….enforce a k where the terms are unconscionable
Grounds for reformation
Mutual mistake or unilateral mistake
Defense: SOF
The SOF requires that a k for the sale of land or anything above $500 be in writing
Defense: Parole Evidence Rule
The PER states that a fully integrated agreement cannot be contradicted by outside evidence and a partially integrated agreement can only be supplemented by extrinsic evidence
Agreement is integrated if the parties manifest intent that it be the final description of the agreement’s terms
Exceptions: collateral agreement doctrine, fraud
Defense: Mirror Image Rule
The MIR states that an acceptance memorialized in a k must mirror the terms of the offer or else it is a rejection and a counter offer
Waiver or Remedies
A customer cannot waive their complete right to recourse or remedy in a k for goods and parts that are deemed unconscionable will not be enforced in a court of law
Nominal Damages
Nominal damages are a small amount of monetary relief that is given to the plaintiff when they have proven liability on a tort, but the amount of actual damages is minimal
Seek to relinquish a wrong that was done to the plaintiff and are more likely to be awarded for intentional torts when not much harm is proven
Permanent Injunction
A permanent injunction may be issued for many reasons as a preliminary injunction. A court will balance the hardships and determine if the permanent injunction should be granted in equity. The plaintiff must post a bond to cover any losses to the defendant if the injunction is invalidly granted
Defense: Unclean Hands
The court will not aid suitors that come to court with unclean hands
Defense: Laches
Laches seek to bar a plaintiff for recovery if they wait too long to bring suit and it causes undue prejudice
Cover
A party may seek cover for a good when the other party has breached
Mutual Mistake
A MM occurs when both parties are mistaken as to an essential element of the k. A k may be voided by the adversely affected party if:
- it existed at the time of the k formation
- it relates to a basic assumption of the k
- it causes a material impact on the transaction, and
- the adversely affected party did not assume the risk of the mistake
Unilateral Mistake
A UM occurs when one of the parties is mistaken as to an essential element of the k and the mistake party may seek to void the k if:
- he did not bear the risk of the mistake
- either enforcement would be unconscionable OR the non-mistaken party caused the mistake, had a duty to disclose or failed to disclose, and knew or should have known that the other party was mistaken, and
- must be an absence of serious prejudice to the other party if rescission granted
Fraudulent Misrepresentation
FM requires:
- a false assertion of fact made knowingly, or recklessly without knowledge of its truth
- with intent to mislead the other party
- that induced assent to the k and
- justifiable reliance
Promissory Estoppel
PE is an equitable defense that will be granted if reliance upon a promise was reasonably foreseeable, there was actual inducement or forbearance, and detrimental reliance such that injustice can be avoided only by enforcement of the promise.
Compensatory in Tort: Fraud
In most jurisdictions, the measure of recovery for fraud is the “benefit of the bargain” (i.e., the difference between the actual value received and the value that would have been received if the misrepresentation were true). Instead of basing the “loss of bargain” measure on the value of what the buyer received, the buyer can base his recovery on an amount equal to the cost of conforming the property to what he was promised. Some jurisdictions limit the plaintiff’s recovery to his out-of-pocket losses, (i.e., the difference between the amount that the buyer paid and the market value of what he received). A few jurisdictions allow the plaintiff to elect which measure to use.
Expectation in K
Land Sales K
Expectation damages put the plaintiff in the place she would have been in had the breach not occurred.
In a land sales contract, when the seller breaches, the buyer receives the difference between the contract price and the market value as of the date of the breach.
Consequential in K
In a breach of contract action, consequential damages are reasonably foreseeable losses to a nonbreaching party that go beyond expectation damages, such as loss of profits. Consequential damages are damages that arise out of special circumstances unique to the parties to the contract, rather than arising necessarily from the transaction itself.
Restitution - Unjust Enrichment
To recover in restitution based on unjust enrichment, a plaintiff must have conferred a benefit on the defendant. The benefit must have yielded a measurable increase in the defendant’s wealth. The defendant’s retention of the benefit must be unjust. Often, the defendant’s retention of the benefit is unjust because the defendant has wrongfully acquired the benefit through theft, fraud, duress, or undue influence.
