Remedies Flashcards
Compensatory Damages (Contract)
Puts P in same position he would have been in had he not been harmed by D’s breach. This is an expectation interest: (1) Default is nonbreaching party gets difference between market price and contract price plus incdentals and consequentials, less expenses saved. (2) If nonbreaching buyer gets cover, buyer gets difference between replacement price and contract price. (3) If buyer accepts nonconfirming goods, buyer can recover difference between value of goods accepted and value of goods as warranted (plus incidentals and consequentials). (4) If buyer paid anything up front, and revokes acceptance, buyer can also get their money back.
Compensatory Damages (Tort)
Puts P in same position he would have been in had he not been harmed by D’s breach. This is retrospective, and includes compensation for pain and suffering and loss of enjoyment.
When are reliance damages available
P can recover expenditures related to performance of a contract, up to the contract price.
When are restitution damages available
P can recover restitution for the value of the benefit conferred on D, if P provided the services non-gratuitously and D is in total breach.
When are nominal damages appropriate?
When P established a c/a but suffered little or no loss
When are punitive damages available?
To punish D for engaging in serious misconduct w/ improper state of mind. Usually capped at compensatory damages.
When are liquidated damages appropriate?
Liquidated damages are damages (1) agreed to in advance by contract, (2) not intended as a penalty, (3) a reasonable approximation of potential loss, (4) made in the face of uncertainty about likely damages.
Is an agreement to accept an arbitrator’s decision re remedies enforceable?
Generally Yes
What are incidental damages
Incidental damages are reliance-type expenses reasonably incurred in a transaction that are recoverable without special proof.
Limitations on Damages
(1) Damages must be reasonably certain (lost profits are vulnerable to uncertainty); (2) D must have been the but-for and proximate cause of P’s loss, (3) D can avoid damages for losses that P could reasonably have avoided; (4) In contract, emotional distress damages are generally not allowed
When are consequential damages appropriate?
Consequential damages are contract damages that naturally arise from the breach and were within the contemplation of the parties at the time of contract formation or were otherwise foreseeable. They must be specifically pleaded.
Collateral Source Rule
A tort victim’s recovery is not reduced if the defendant’s tortious conduct results in a third party providing benefits to P.
Direct Benefit Rule
If P achieves savings as a direct consequence of D’s conduct, P’s recovery is offset by those savings
PI Standard
(1) Likelihood of success on the merits, (2) likelihood of irreparable harm, (3) balance of hardships favors P, (4) feasibility of enforcement
Requirements for Permanent Injunction
(1) P irreparable harm without injunction, (2) balance of equities favors P, (3) Feasibility of enforcement, (4) no equitable defenses (laches and unclean hands)
TRO Standard
Up to 14 days, allowed ex parte, if risk of irreparable harm, and harm to P outweighs harm to D.
When is Specific Performance appropriate?
(1) Contract exists, (2) All conditions precedent satisfied, (3) contract terms sufficiently certain to provide basis for order, (4) Inadequate remedy at law, (5) enforcement feasible, (6) balance of equities favors P.
When is rescission appropriate?
When a defense to contract formation exists. P must give notice to D and return benefits of contract before filing suit.
When is reformation appropriate?
Absent laches, unclean hands, and potential harm to rights of innocent third parties, reformation may be used to rectify MUTUAL MISTAKE (if possible to equitably change contract notwithstanding existence of mistake as to material fact at outset of contract) or UNILATERAL MISTAKE (if one party was aware of mistake and fraudulently induced K or did not correct mistake).
What are unclean hands
P’s engages in unethical or immoral conduct closely related to P’s claim (conduct need not harm D)
