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Question 1

What are the two things to worry about for damages for construction contracts?

Answer 1

The contractor’s recovery and the owner’s recovery

Question 2

What can contractors recover in construction contracts for damages?

Answer 2

Profit plus costs:

• complete performance: agreed contract price
• no work done: profit that would’ve been made from the contract (difference between contract price and cost of performance)
• work delayed by breach: rental value of his equipment plus increased overhead costs

Question 3

What does an owner get in damages on a construction contract?

Answer 3

Cost of completion + diminution value (if you defectively performed: cost of remedying the defect)

Question 4

The Coho pipe case gave what damages and why?

Answer 4

The owner got the difference between the value of the house according to the plan, and the value as constructed, because courts like to avoid economic waste

Question 5

What are the times that a court might give the cost of replacement to the owner in a construction contract when something has been done not according to plan?

Answer 5

• if there was intrinsic value in the item specified

- willful breach

Question 6

If a contractor abandons a project before completion, what damages can the owner get?

Answer 6

The reasonable cost of completion plus anything suffered from the delay (like rental value during the delay)

Question 7

If your land was torn up by stripmining, and there’s an argument about returning the land, what damages will the owner likely get?

Answer 7

Probably not the cost to return the land to the way it should’ve been, but instead the difference in the land’s value between before the stripmining and after

Question 8

If an employee is wrongfully discharged, what are the damages?

Answer 8

Salary he would’ve gotten for the rest of the term minus what he has already earned or will earn from finding similar employment until the term ends

Question 9

What is involved in the burden of mitigation for an employee that is wrongfully discharged?

Answer 9

He must mitigate, but needn’t:

• take a job of lesser rank or salary, or
• one that is totally different, or
• an unreasonable distance from his current job, or
• that requires him to live away from his spouse

If he does take one of those jobs, those earnings are subtracted

Question 10

If an employee wrongfully terminated his employment, what are the damages that can be given to employer?

Answer 10

Difference between the market value of the services and the contract rate (additional costs to get a substitute employee)

Question 11

If a plaintiff went into business to mitigate his damages after being wrongfully terminated, since his earning capacity is low in the early stages of a business, what is his recovery?

Answer 11

The value of his services in the building of the business

Question 12

Is money spent to mitigate damages recoverable?

Answer 12

Yes

Question 13

Under the UCC, if the seller repudiates, what are the different kinds of damages a buyer can get?

Answer 13

• total breach
• warranty/fraud
• consequential and incidental damages

Question 14

What damages can a UCC buyer get for total breach?

Answer 14

Difference between the market price of the goods at the time buyer learned of the breach, and the contract price (with incidental and consequential damages added and the expenses saved deducted)

Question 15

What are the stipulations in order to cover under the UCC?

Answer 15

• must make a GOOD FAITH purchase of substituted goods
• with NO reasonable DELAY (if buyer can’t find the exact item, he can get a reasonable substitute of higher quality and cost)

Question 16

If the buyer doesn’t cover under the UCC, and just wants the market price minus the contract price, what are the different views about the timing of the market price?

Answer 16

• Majority: market price when delivery should have been made

- UCC: market price at the time the buyer learned of the breach (because sometimes this is much later)

Question 17

If there has been a breach of warranty or fraud under the UCC, what are the buyer’s damages?

Answer 17

Difference between the market value of the goods tendered at the time of acceptance and the value they would have had if they had been as warranted

Question 18

Under the UCC, remedies for material misrepresentation or fraud are the same as what?

Answer 18

Breach (difference between amount paid and value of goods if they had been as represented)