Remedies (*MBE) Flashcards
Non-Monetary Remedies: Specific Performance
Specific Performance = equitable remedy available only if monetary damages are inadequate to compensate
Real Property = generally available because property is “unique”
Sale of Goods (Art. 2) = available only if goods are unique or there are “other proper circumstances” (i.e., an inability to buy substitute goods in the market)
Service Ks = NOT available! But maybe injunctive relief
Non-Monetary Damages: Unpaid Seller’s Right to Reclaim Goods (Art. 2)
General Rule = not available under Art. 2
Exception = if buyer was INSOLVENT when it received the goods AND seller makes a demand within 10 DAYS after buyer received them
- Art. 2 = seller has no right to reclaim goods from innocent TP who bought goods from buyer
Monetary Remedies: Damages
- Punitive Damages = NOT awarded in breach of K cases because purpose of K damages is to COMPENSATE not punish
- Liquidated Damages
- Expectation Damages
- Incidental Damages
- Consequential Damages (under Art. 2 = buyer only!)
- Avoidable Damages = CL mitigation rule (injured party can’t recover damages he could have avoided with reasonable effort)
Monetary Remedies: Liquidated damages
Upheld if damages were difficult to estimate at the time of the K and are a reasonable forecast of probable damages
CANNOT operate as a penalty
- e.g., $100/day for breach = flexible; damages are graduated (increasing with delay); can seem like reasonable forecast
Monetary Remedies: Expectation Damages
CL general rule = benefit of the bargain
Art. 2
- Buyer has 3 options:
(1) COVER damages if buyer covers in good faith (cover price - K price)
(2) MARKET damages if buyer doesn’t cover in good faith or at all (market price - K price)
(3) LOSS IN VALUE if buyer keeps non-conforming goods (value as promised - value delivered) - Seller has 4 options:
(1) RESALE damages if in good faith (K price - resale price)
(2) MARKET damages if does not resell in good faith or at all (K price - market price)
(3) LOST PROFIT if seller is LOST VOLUME DEALER (profit it would have made on sale)
(4) K PRICE if seller cannot resell the goods
Monetary Remedies: Incidental and Consequential Damages
Incidental = cost to injured buyer/seller of transporting/caring for goods after a breach and of arranging a substitute transaction
Consequential = BUYER’S (not for seller) damages that were reasonably foreseeable to the breaching party at the time of the K
Buyer’s Right to Replevy Identified Goods Under Art. 2
If a buyer has made at least part payment of the purchase price of goods that have been IDENTIFIED under a K, and the seller has not delivered the goods, the buyer may replevy the goods from the seller in 3 circumstances
(1) the right to replevy arises if the seller becomes insolvent within 10 days after receiving the buyer’s first payment
(2) a buyer has a right to replevy if the goods were purchased for personal, family, or household purposes. In either case, the buyer must tender any unpaid portion of the purchase price to the seller.
(3) the buyer may replevy undelivered, identified goods from the seller if the buyer is unable to secure adequate substitute goods after a reasonable effort
Construction K
If a property owner breaches a construction K BEFORE construction has started
- the builder is entitled to reliance damages AND the profits he would have derived from the contract( puts him where he would have been had the promise been performed)
- the builder is NOT entitled to the K price because the contract price includes costs that the builder has not yet incurred
If property owner breaches DURING construction
- the builder is entitled to any profit he would have derived from the contract plus any costs he has incurred to date by starting construction
- the builder is NOT entitled to the K price because the contract price includes costs that the builder has not yet incurred
