Damages Flashcards
Expectation:
Put the aggrieved party in the position they would have been in had both parties fulfilled the contract. This is the “alternative universe.”
Reliance
Put the aggrieved party in the position they were in before entering the contract. This “makes the bad dream go away.”
Restitution
Breaching party must return benefits directly conferred from non-breaching party. This “gives the toy back.”
Specific Performance
- No adequate remedy at law ($ damages don’t make you whole)
- Specific performance would be possible to carry out
If the breaching party can’t follow through, a judge won’t order the specific performance.
Restatement § 347 Measure of Damages in General
Injured party has a right to damages based on his expectation interest as measured by
the loss in the value to him of the other party’s performance caused by its failure or deficiency, plus
any other loss, including incidental or consequential loss, caused by the breach, less
any cost or or other loss that he has avoided by not having to perform
UCC §1-106. Remedies to be Liberally Administered
The remedies shall be liberally administered
The aggrieved party may be put in as good a position as if the other party had fully performed but neither consequential or special nor penal damages may be had except as specifically provided in this Act or by other rule of law.
Tests for determining whether a contract for mixed services and goods should be interpreted pursuant to UCC or Common Law.
- Center of Gravity
- Designation by parties
- Nature of Contract
- Dispute Centered
UCC § 2-711 (abridged). Buyer’s Option to Cover
Where the seller breaches, the buyer may either…
“cover” and have damages (§ 2-712) as to all the goods affected… or
recover damages for non-delivery (§ 2-713)
UCC § 2-712. “Cover”; Buyer’s Procurement of Substitute Goods.
After seller’s breach, buyer may “cover” by making in good faith and without unreasonable delay:
Any unreasonable purchase of or contract to purchase goods in substitution for those due from the seller.
Buyer’s recovery from seller:
[cost of cover] - [K price] + [incidental/consequential damages] - [costs/losses avoided].
Failure of B to effect cover . . . does not bar him from any other remedy.
Groves v. John Wunder Co.
Majority: Cost of Completion (Default)
Cost of remedying the defect is the proper measure of damage
Dissent: Economic Waste (Default)
Difference between mkt value post contract minus mkt value pre contract
Peevyhouse v. Garland Coal Mining Co.
Majority: Economic Waste (Immutable, effectively)
Difference between present value of farm & value it would have been if def had done its part
Dissent: Economic Waste (Default)
Cost of remedying the defect is the proper
Restatement §348(2) Paraphrased
If breach results in defective or unfinished construction and the loss in value to injured party is not proved with sufficient certainty, the injured party can claim damages on EITHER:
The diminution in market price of property; OR
The reasonable cost of completion or remedying breach SO LONG as this cost is not clearly disproportionate to the probable loss of value to him.
