Remedies

Question 1

When will a court usually decline to award specific performance?

Answer 1

When there is an adequate remedy at law

Question 2

When will a court consider providing specific or injunctive relief?

Answer 2

When the damages are difficult to quantify.

Question 3

When is specific performance available under UCC 2-716?

Answer 3

When the goods are unique or in other proper circumstances (such as the inability to cover)

Question 4

When is specific performance available under CISG Article 46?

Answer 4

1. The buyer can almost always demand performance, unless they have avoided the contract
2. If non-conformity is a fundamental breach, the buyer can demand substitute goods
3. The buyer can demand the seller to repair non-conforming goods unless repair would be unreasonable

Question 5

What does CISG Article 28 say about specific performance?

Answer 5

Countries only need to comply with the specific performance requirements of CISG Article 46 if they would do so under their own law.

Question 6

What is Formula A for calculating damages?

Answer 6

damages = loss in value - cost avoided + other loss - loss avoided

Question 7

How is “cost avoided” calculated?

Answer 7

cost avoided = project price - profit (including overhead) - actual variable costs incurred

Question 8

What is Formula B for calculating damages?

Answer 8

damages = profit + actual cost incurred + other loss - loss avoided

Question 9

What are “other losses”?

Answer 9

Incidental and consequential losses

Question 10

What is a fixed cost?

Answer 10

A cost that does not vary depending on the quantity of work performed (ex: salaries and building rent)

Question 11

What is a variable cost?

Answer 11

A cost that varies with the quantity of work performed (ex: materials and labor)

Question 12

What is overhead?

Answer 12

Fixed costs which are allocated to all sources of revenue

Question 13

What are incidental cost / damages?

Answer 13

Costs associated with an active effort to mitigate damages

Question 14

What are consequential costs / damages?

Answer 14

Losses involving events and circumstances external to the contract at issue, but occurring as a natural consequence of the breach

Question 15

Which consequential damages are recoverable?

Answer 15

Those that are foreseeable:
1. In the ordinary course of events surrounding the contract and its breach or
2. In special circumstances of which the breaching party had reason to know

Question 16

Which consequential damages are NOT recoverable?

Answer 16

1. Those that are not foreseeable
2. Those that could have been reasonably mitigated

Question 17

What is the principle of minimizing damages?

Answer 17

It requires reasonable mitigation of avoidable damages and precludes any award for damages that were reasonably avoidable

Question 18

What is active mitigation?

Answer 18

Taking action to avoid or decrease damages

Question 19

What is passive mitigation?

Answer 19

Not taking action to run up damages (ex: stopping work when the contract is terminated)

Question 20

What damages can a buyer recover under the common law?

Answer 20

1. The loss in value if proven with reasonable certainty
2. Reasonable cost of completing performance or repair

Question 21

If the buyer does not retain the goods, what damages are they entitled to under UCC 2-711?

Answer 21

1. Cover price: cover price - contract price + other loss - expenses saved
2. Market price: market price - contract price + other loss - expenses saved

Question 22

How are a buyer’s consequential damages limited by UCC 2-715(2)?

Answer 22

1. They must be foreseeable at the time of the contract 2. They must not have been able to be reasonably covered

Question 23

If the buyer retains the goods, what damages are they entitled to under UCC 2-714?

Answer 23

1. Reasonable loss from the ordinary course of events
2. Damages = (value at the time and place of acceptance) - (value if they had been as warranted)

Question 24

How can a buyer reduce their payment to the seller for non-conforming goods under UCC 2-717?

Answer 24

After notifying the seller of their intention to do so, the buyer can reduce their payment to the seller by the damages resulting from the breach

Question 25

What damages are recoverable under CISG Article 74 and 77?

Answer 25

1. Any foreseeable damages
2. That have been reasonably mitigated, or the breaching party can reduce damages by the amount they should have been mitigated

Question 26

What can the seller recover for goods the buyer accepts or that were damages after risk was transferred to the buyer?

UCC 2-709(1)

Answer 26

The price of the goods + incidental damages

Question 27

What can the seller recover for “identified” goods (specific to the contract) that the buyer refuses to accept?

UCC 2-709(1)

Answer 27

The contract price IF the seller is unable to resell them for a reasonable price after reasonable effort

Question 28

What can the seller recover from the original buyer in the event of a resell (due to the buyer’s breach)?

UCC 2-706(1)

Answer 28

Damages = contract price - resale price + incidental damages - expenses saved

Question 29

What are the seller’s right to incidental and consequential damages?

UCC 2-710

Answer 29

Costs incurred from dealing responsively with the breach - usually involve costs of mitigating the damages

Question 30

If a seller can’t recover the contract price or resell the goods, what damages can they recover?

UCC 2-708(1)

Answer 30

Damages = marketprice at the time and place of delivery - contract price + incidental damages - expenses saved

Question 31

Is the seller entitled to consequential damages for a breach of contract?

Answer 31

No.

Question 32

What is the requirement for certainty of damages under the common law?

Answer 32

Damages must be proven and quantified with reasonable certainty.

Question 33

What is the requirement for certainty of damages under the UCC?

Answer 33

There must be a reasonably certain basis for providing an appropriate remedy.
More liberal than the CL requirement that damages must be “proven and quantified”.

Question 34

What are the requirements for liquidated damages under both the CL and UCC?

Answer 34

They must be reasonable in terms of either:
1. Damages reasonably estimated at the time the contract was concluded
2. Damages actually incurred