remedies Flashcards
money damages
compensate P for economic loss NOT To punish - NO PUNITIVE DAMAGES
GENERAL RULE - loss expectation
expectation interest - put back in same position as if K had been performed OF WHATEVER WAS PROMISED.
looking for AFTER THE FACT expectations
Reliance Interest
put plaintiff is same economic position as if K had never happened
P k’s to paint O’s house for $1000 payable in advance. O pays 1000. P does not paint the house. O hires another painter who charges 1400. What are O’s expectation damages?
1400 - puts O in the same position she would have been in had the job been completed. EXPECTATION INTEREST.
P k’s to paint O’s house for 1000 payable when P completes work. P anticipates making 200 profit from the K, O breaches and P has started work and used up 50 of paint. Expectation damages?
- Expected to gain 200 and 50 paint was used – but they give you what you should have had the K been completed.
reliance = change in position…
between the start and the end of the deal?
restitution interest
put D in same economic position as if K had never happened (UNJUST ENRICHMENT). take it away.
P k’s to paint O’s house for $1000 payable in advance. O pays 1000. P does not paint the house. O hires another painter who charges 1400. What are restitution damages?
TAKE AWAY 1000 in restitution damages.
when is reliance and restitution different?
Reliance = P’s spending (maybe she spent on other things that DIDN’t go to D for payment)
Restitution = takes away D’s unjust gain (maybe he only got X and P spent on other things. Take away ONLY what D unjustly received)
P k’s to paint O’s house for 1000 payable when P completes work. P anticipates making 200 profit from the K, O breaches and P has started work and used up 50 of paint. Restitution Damages?
FAIR MARKET VALUE OF THE WORK DONE. Wasted paint doesn’t matter, look at the D’s enrichment.
Art 2 damages
refelcts general K law damage philosophy of Expectation remedy
- who breached
- who has goods
4 possible Art. 2 fact patterns.
- Seller Breach, Buyer keeps the goods
Damages = (Fair Market value had good been delivered perfectly) - (FMV that the goods were actually delivered in)
- Seller Breach, seller keeps the goods
buyer gets the market price at the time of discovery of the breach MINUS the contract price.
ex. B k’s to buy carpet from S for $5000. S n ever delivers, at time of breach carpet worth $6600 for comparable carpeting. B can recover $1600.
- Buyer breach, buyer has the goods
Seller keeps the K price.
ex. S sells carpet to B for K price of $800. Buyer received and does not pay. B owes $800. Doesn’t matter what the market value of it is at the time delivered.
- Buyer breach, seller has the goods
K price minus market price at time of delivery
OR
K price minus resale price
OR
provable lost profits.
4A example: C k’s to sell car to BG for $1000. BG breached. sells to EV for $800. damages?
1000 - 800 = 200 puts in the same position he though he’d be in.
Must be in good faith and commercially reasonable.
4B example: C k’s to sell car to BG for $1000. BG breached. sells to EV for $1000. damages?
ZERO. NO DAMAGES.
4B. S leathers K’s to sell leathers to D for 1000. ASsume that it’s inventory that’s regular inventory. D breached. S sells the very same items to J for 1000. Can S recover any damages from D?
If so, how much? What if S’s profit margin is 20% of the sales price?
YES (lost volume seller rule - different from just one item being sold)
how much? WTF.
20%? 20% x K price = 200.
incidental damages (General)
costs incurred in dealing with the breach ALWAYS recoverable
cost of finding replacement deal
ex. S makes K with O, but breaches. O has to spend money to advertise for 20. S owes that 20 to O as incidental damages.
NO FORESEEABILITY - any reasonable person will know it.
Foreseeable consequential (Special) damages
MUST BE FORESEEABLE - but special to P’s circumstances, recoverable ONLY if D had reason to know at time of K formation that it would happen.
Look for P telling D about special circumstances at the time K is formed.
avoidable damages
no recovery for damages that could have been avoided without undue burden on the P. Burden of pleading and proof on D.
D must prove that you sat on your ass and no self-help.
this is DEFENSE
certainty limitation
judgment call whether its a reasonable to think damages would actually occur
ex: P is a new business…not proven that P would make any money.
liquidation damages (penalty clause)
look for K clause fixing amount of damages – issue will be validity, concern is whether it’s too high.
look for
- damages were difficult to know at time of K (new store?)
- provision is reasonable to know (judgment)
anytime liquidated damages at BIG lump sum - say it’s invalid and incongruent to damages.
limitation of remedies
look for K provision limiting amount that can be recovered.
S sells widgets to K. K provides that if widgets are defective, B’s recovery is limited to return of amount paid.
VALID.
