Remedy 1-10

Question 1

What legal remedies are available for a breach of contract?

Answer 1

Expectation damages

Reliance damages

Consequential damages

Incidental damages

Restitution damages

*Punitive damages are generally NOT available.

Priority: HIGH

Question 2

What are Expectation Damages?

When are they available?

Answer 2

Damages that arise directly from the breach, and are an attempt to put the non-breaching party in the same position it would have been in but for the breach.

To recover, damages must be:

Caused by the defendant;

Foreseeable;

Certain; AND

Unavoidable.

Priority: HIGH

Question 3

What are Reliance Damages?

When are they available?

Answer 3

The expenditures made by a party in reliance of the contract and are an attempt to put the non-breaching party in the position it would have been if the contract never existed.

Available when:

Plaintiff acted in reliance on the defendant’s agreement to perform; AND

The plaintiff’s reliance was foreseeable.

Priority: HIGH

Question 4

What are Consequential Damages?

When are they recoverable?

Answer 4

Damages that arise indirectly from the breach and are awarded because of the injured party’s special circumstances.

To recover, damages MUST be:

Reasonably foreseeable at the time of contract formation;

Arise from the plaintiff’s special circumstances that the defendant knew or had reason to know of; AND

Reasonably certain(not speculative).

Priority: HIGH

Question 5

What are Incidental Damages?

Answer 5

The reasonable costs incurred as a result of a breach of contract (i.e. costs of returning non-conforming goods).

Priority: HIGH

Question 6

When is Restitutionawarded?

Answer 6

It is awarded to prevent unjust enrichment, and is available when one party confers a benefit onto another party.

Damages = based on value of benefit conferred.

Priority: HIGH

Question 7

When will Liquidated Damages be enforced?

Answer 7

If:

The amount of damages is difficult to estimate at the time the contract was formed; AND

The amount is reasonable to the actual damages suffered.

Priority: Low

Question 8

What are the damages for breach of a land sale contract?

Answer 8

Any amount paid;

The difference between the fair market value at the time of the breach and the contract price;

Expenses incurred in investigating title and preparing necessary paperwork;

Expenses incurred in preparing to occupy the land;

Possible consequential damages; AND

Interest.

Priority: Medium

Question 9

UCC Seller’s Remedies / Damages

Under the UCC, what remedies does a seller have if a buyer breaches a contract for the sale of goods?

Answer 9

Withhold delivery of the goods;

Cancel;

Recover cover damages;

Recover market damages;

Recover lost profits if the seller is a lost volume seller;

Stop delivery of the goods when he discovers buyer is insolvent;

Stop delivery of a truckload when buyer breaches; OR

Replevy identified goods.

Priority: Low

Question 10

UCC Buyer’s Damages

Cover Damages

vs.

Market Damages

vs.

Loss-In-Value Damages

Answer 10

Cover: Difference between the contract price and the price of substitute goods (used if buyer covered in good faith).

Market: Difference between the market price and contract price (used if the buyer did not cover in good faith or at all).

Loss-In-Value: Difference between the value as promised and the value of the non-conforming goods (used if the buyer keeps the non-conforming goods).

Priority: Medium