Remedies

Question 1

Anticipatory repudiation: options available to a nonbreaching party

Answer 1

Upon a clear and unequivocal repudiation, and unless the other party has retracted the repudiation, the nonbreaching party may:

(1) Sue immediately for damages, unless the nonbreaching party has already completed performance; or
(2) Ignore repudiation and demand performance.

Question 2

Reliance damages

Answer 2

Reliance damages are the usual remedy upon application of promissory estoppel.

Calculated to put a party in the same economic position it would have been if the contract had never been created.

Question 3

Restitution damages

Answer 3

Restitution damages are calculated to give the plaintiff the economic benefit she conferred on the defendant.

They are permitted in cases where the nonbreaching party has partially performed a below-market-price contract.

Question 4

Liquidated damages

Answer 4

If punitive, enforceable if:

(1) The amount was reasonable at the time of contracting;
(2) Actual damages from breach would be uncertain in amount and difficult to prove.

Question 5

Specific performance

Answer 5

Presumptively not available in contracts for personal service.

Presumptively available in real estate contracts; available for UCC contracts involving unique goods, e.g., art or custom-made items.

Question 6

Right of reclamation

Answer 6

Right of reclamation is available to an unpaid seller sold on credit to a buyer when it was insolvent if:

(1) The buyer was insolvent at the time of receipt;
(2) The seller demanded return:
(a) within 10 days of receipt; or
(b) within a reasonable time if the buyer misrepresented its insolvency to the seller, in writing, within three months before the delivery; and
(3) The buyer still has the goods.

Question 7

Remedies available to a breaching party

Answer 7

Even a party who materially breaches a contract may be entitled to restitution damages.

To recover expectancy or reliance damages, a party to a non-UCC contract must not materially breach the contract.

Question 8

Punitive damages

Answer 8

Punitive damages are very rarely available in contract actions and are not typically recoverable unless the conduct constituting the breach is also a tort for which punitive damages are available.

Some statutes apply punitive damages for the purpose of punishing fraud, violation of fiduciary duty, acts of bad faith, and for deterrence.

Question 9

Restitution damages: measures

Answer 9

Restitution damages can be measured as:

• The fair market value of the benefit conferred on the breaching party; or
• The increase in the value of the breaching party’s property attributable to the nonbreaching party’s performance.

Question 10

Restitution damages: plaintiff breach

Answer 10

If the plaintiff breached the contract, his damages are generally limited to:

• the value of the benefit conferred upon the defendant,
• taking into consideration any damages suffered by the defendant.