Remedies for Unexcused Performance Flashcards
When parties are seeking specific performance or an injunction, what two things to look for?
Adequacy of remedy at law AND unclean hands
If there is any doubt as to whether specific performance is permissible, do we say yes or no?
No
What sort of goods require specific performance?
Unique goods (e.g., antiques, art, custom-made, etc)
S contracts to sell an antique desk to B. S breaches. Can B get SP if she told S that she was buying the desk for a museum although he plans to resell the desk to Conviser for a huge profit? Explain.
No. There is never SP for a misrepresentation.
Is SP available for service contracts?
No
What is a possible remedy for service contract breach?
Injunctive relief.
E contracts with BRI to lecture for BRI. Epstein breaches. Can BRI obtain a court order requiring E to lecture for BRI? Explain.
No. No SP for service contracts.
E contracts with BRI to lecture for BRI. Epstein breaches. Can BRI obtain a court order requiring E to abstain from lecturing for a competing bar prep course? Explain.
Yes. Injunctive relief ok here.
Describe reclamation.
Goods sold on credit, but buyer hasn’t paid. Seller wants the goods back.
What are the three requirements for reclamation to be effective?
Buyer must have been insolvent when he received the goods
Seller must demand return of the goods within 10 days of receipt (becomes a “reasonable time rule” if, before delivery, there had been an express representation of solvency by the buyer)
Buyer still has the goods at the time of demand.
For reclamation to be proper, the seller ordinarily must demand the return of the goods within 10 days of receipt. When does it become a “reasonable time” rule?
if, before delivery, there had been an express representation of solvency by the buyer
What must be true of the buyer’s financial situation at the time he receives the goods for reclamation to be effective?
Buyer must have been insolvent.
On Jan 15, S sells B grits on credit. The grits are delivered on Jan 22. B is insolvent on Jan 22. S learns of B’s financial difficulties and demands return of the grits on Jan 27. B still has the grits on Jan 27. Can S get the grits back by reclamation? Explain.
Yes
Buyer was insolvent when he received the goods
Seller demanded return of the goods within 10 days of receipt
Buyer still had the goods at the time of demand.
Define entrustment.
Voluntarily leaving something of yours with someone else.
O takes her watch to S Watch Sale and Service (S) for repair. S wrongfully sells O’s watch to B, a BFP. Can O recover her watch from B? Explain.
No. If you entrust your goods to one WHO SERVICES those type of goods, you are at a risk of sale to a BFP. Remedy is limited to a claim against the store.
What risk do you put yourself at by entrusting goods to a retailer/servicer in that type of good?
If you entrust your goods to one WHO SERVICES those type of goods, you are at a risk of sale to a BFP. Remedy is limited to a claim against the store.
What is the underlying policy of money damages? What is not?
Compensate the plaintiff
NOT punishing the defendant.
What should be the first sentence in an essay about money damages
Money damages are intended to compensate the plaintiff, rather than pushing the defendant.
After “Money damages are intended to compensate the plaintiff, rather than pushing the defendant,” what should the second sentence be in an essay about money damages?
Compensation is achieved by protecting the plaintiff’s EXPECTATION INTEREST.
“Money damages are intended to compensate the plaintiff, rather than pushing the defendant. Compensation is achieved by protecting the plaintiff’s EXPECTATION INTEREST.” What do you talk about next? What do you say next?
Define Expectation.
“Expectation simply means that people who contract expect that the other person will not breach. Expectation damages protect that expectation.”
How do you determine expectation damages? (formula)
Dollar value of performance without breach
LESS
Dollar value of performance with breach.
P contracts to paint O’s house for $1000, payable when P completes the work. P breaches – he does not paint. O hires another painter who charges $1,400. O sues P for beach of k. What is the measure (amount) of O’s damages that O can recover from P for P’s breach of k? Explain.
$400.
“Money damages are intended to compensate the plaintiff, rather than pushing the defendant. Compensation is achieved by protecting the plaintiff’s EXPECTATION INTEREST.”
Expectation simply means that people who contract expect that the other person will not breach. Expectation damages protect that expectation. Expectation damages are determined by taking: The dollar value of the performance without breach LESS dollar value of performance with breach.
P contracts to paint O’s house for $1000, payable when P completes the work. P anticipates making $200 profit from this k. O breaches after P has started work and used $100 of paint and labor. P sues O for breach. What is the measure of P’s damages?
$300
“Money damages are intended to compensate the plaintiff, rather than pushing the defendant. Compensation is achieved by protecting the plaintiff’s EXPECTATION INTEREST.”
Expectation simply means that people who contract expect that the other person will not breach. Expectation damages protect that expectation. Expectation damages are determined by taking: The dollar value of the performance without breach LESS dollar value of performance with breach.
S sells B an antique car for $30k. B pays the $30k, and S delivers. Although the k provided that all parts of the car were authentic and original, some were not. B keeps the car and sues for breach of k. The jury finds that at the time and place of B’s acceptance of the car, the car as delivered was only worth $20k; the jury also finds that if the car has been delivered as contracted, it would have been worth $34,000.
How much can R recover? Explain.
$14,000.
When a seller delivers goods but their condition constitutes breach, the buyer keeps the goods and is entitled to damages equally the FMV if perfect – FMV as deliver (or the cost of repair).
What are a buyer’s damages in a situation in which delivery is effectuated but the goods do not conform?
the buyer keeps the goods and is entitled to damages equally the FMV if perfect – FMV as deliver (or the cost of repair).
What are a buyer’s damages if the seller breaches and retains the goods?
market price at the time of discovery of the breach LESS K price; OR
Reasonable replacement price LESS k price
WHICHEVER IS GREATER.
S contracts to sell B carpeting for $5,000. S never delivers the carpeting (or B refuses because it was not perfect tender). At the time B learned of the breach, the market price of comparable carpet is $6,600. B buys the replacement carpet for $7,000. How much in damages is B entitled to? Explain.
B can get $2000.
The market price ($6,600) less the k price ($5,000) is $1,600.
The reasonable replacement price ($7,000) less the k price ($5,000) is $2,000.
The latter is greater, so that is the measure of his damages (when S breaches and has the goods).
What is the measure of damages when buyer breaches, but buyer keeps the goods?
Contract price.
What is the measure of damages when buyer breaches, but seller has the goods?
What is seller can’t resell?
Ordinarily, K Price LESS resale price.
If seller cannot resell, the seller can recover the k price.
E contracts to sell his 73 Caddy to COnvsier for $1,000. Conviser breaches. E then sells the Caddy to SS for $800. How much in damages for Epstein? Explain.
$200.
K Price LESS resale price.
E contracts to sell his 73 Caddy to COnvsier for $1,000. Conviser breaches. E then sells the Caddy to SS for $1,000. How much in damages for Epstein? Explain.
None.
K Price LESS resale price.
S&M Leather contracts to sell off-the-rack leathers to Conviser for $1000. Conviser breaches. S&M sells the very same items to Grey for $1000. Can S&M recover damages? Explain.
Yes. Had Conviser not breached, S&M would have sold TWO sets.
S&M Leather contracts to sell off-the-rack leathers to Conviser for $1000. Conviser breaches. S&M sells the very same items to Grey for $1000. How much in damages can S&M recover damages? Explain.
Provable lost profits. Had Conviser not breached, S&M would have sold TWO sets, so they are entitled to whatever profit they would have made on C’s leathers.
Incidental damages are always/sometime/never recoverable for the breach of k for the sale of goods.
Always.
What are incidential damages ?
Costs incurred in dealing with the breach (storing rejected goods, finding a replacement buyer for a services k)
P contracts to paint O’s house for $1000. P breaches. O spends $20 finding another painter, X, who agrees to paint for $1,400. What is the measure of O’s damages?
$400 general PLUS $20 incidental.
Provide the definition for “consequential damages”? Remember, it is unique?
Damages arising from P’s special circumstances, but ONLY on situations in which D had reason to know of these special circumstances at the time of the contract.
Consequential damages are limited to what type of situations?
Those in which D had reason to know of these special circumstances at the time of the k.
M contracts with C carrier to transport goods to another village for repair for $100. C breaches by nonperformance. M is unable to find anyone else who will transport the goods for less than $150 and pays T that must to transport. M sues C for breach? Any consequential damages? Explain.
No, We know nothing special about M. Presumably neither does C.
Consequential damages are those arising from P’s special circumstances. They are limited to situations in which D had reason to know of the special circumstances at the time of the breach.
M contracts with C carrier to transport goods to another village for repair for $100. C breaches by nonperformance. M is unable to find anyone else who will transport the goods for less than $150 and pays T that must to transport. M sues C for breach? What is the amount of M’s recoverable damages? Explain.
$50 in ordinary damages.
No consequential damages because we know nothing special about M. Presumably neither does C.
Consequential damages are those arising from P’s special circumstances. They are limited to situations in which D had reason to know of the special circumstances at the time of the breach.
M contracts with C carrier to transport goods to another village for repair for $100. C breaches by nonperformance. M is unable to find anyone else who will transport the goods for less than $150 and pays T that must to transport.
C’s breach resulted in a 5-day delay and M lost $1,000 in profits from the closure of M’s Mill. M sues C for breach. Any consequential damages? If no, why not? If yes, how much recoverable? Explain on all fronts.
Yes, we know about M’s special circumstances – her mill was forced to close.
HOWEVER, they are not recoverable because D was not aware of the special circumstances.
M contracts with C carrier to transport a broken shaft to another village for repair for $100. M tells C before the k that the mill was closed because of the broken shaft and would remain closes until the shaft was repaired and returned.
C breaches by nonperformance. M is unable to find anyone else who will transport the goods for less than $150 and pays T that must to transport.
C’s breach resulted in a 5-day delay and M lost $1,000 in profits from the closure of M’s Mill. M sues C for breach.
What is the measure of M’s Damages?
$50 general + $1000 consequential.
Consequential here because M has special circumstances and C knew of them.
When we have ordinary damages, what two other types of damages can we add? What two types do we subtract?
Add: Incidental and consequential
Subtract: avoidable damages (damages that could have been avoided w/o undue burden on the plaintiff) and damages that cannot be established with reasonable certainty.
What are avoidable damages?
Those damages which could have been avoided without undue burden on the plaintiff.
P contracts to paint O’s house for $1,000. P anticipates that she will makes $200 profit from painting. O breaches after P has incurred $100 of costs for paint and labor. Notwithstanding O’s breach, P finished painting and incurs an additional $700 in costs. How much can P recover? Explain
$300. Ordinary damages (Dollar value of performance without breach LESS Dollar value of performance with breach).
Her avoidable damages ($700) don’t count.
P contracts to work for L law firm from 9/1/15 to 8/31/16 for $100k. On August 29, 2015, L breaches. P sues L for breach.
L pleads and proves that later, on 8/30/15, a comparable law firm in the same city offered P a comparable job for the same period, paying her $99k. How much can P recover from L? Explain.
$1000.
Cannot turn own other, comparable opportunities to maintain damages. This is a form of avoidable damages.
Damages that cannot be established with reasonable certainty are most likely to appear in what type of fact patterns?
Services k and a plaintiff engaged in a new business or a new business activity.
Epstein, who has never promoted anything, contracts with Kinky Friedman for a Texas Jewboys reunion concert in Piggot, AK. Kinky breaches weeks before the concert. Should Epstein be able to recover damages protecting his expectation interest? Explain.
No.
There is no way to tell with certainty what the damages should be here. This is Kinky Friend in a Podunk little town. No way to tell how many people will show up.
Epstein, who has never promoted anything, contracts with Kinky Friedman for a Texas Jewboys reunion concert in Piggot, AK.
Epstein has spent $2k arranging for and promoting the concert.
Kinky breaches weeks before the concert. Should Epstein be able to recover the $2000? Explain.
Yes. Reliance damages
Liquidated damages are most likely to come up in a fact pattern involving what?
A k with a provision fixing damages.
A liquidated damages provisions will be considered invalid if it can be construed as a what?
Penalty
For a liquidated damages provisions to be valid, it must be a _______ ______ of damages.
Reasonable forecast
B contracts to build a store for O. Contract fixes damages for delay at $10k. What sort of damages?
Liquidated.
B contracts to build a store for O. Contract fixes damages for delay at $10k. Is the provision valid?
Probably not, as it does not seem like a reasonable forecast.
Anytime there is a services k AND fixed delay damages, the set amount is probably not a reasonable forecast. Why not?
A true reasonable forecast will provide a range of damages that is dependent on the facts.
When there is an argument raised about avoidable damages, who carries the burden of pleading? The burden of proof?
Defendant x 2
