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Unformatted text preview: Week 9 lecture 1 Monday, October 22, 2007. Remedies for Breach of Contract A. Damages 1. Nominal Damages token or symbolic damages. 2. Compensatory damages basic damages that result from breach of contract. a. Compensate you for loss of the bargain. b. Measure these damages based on the type of contract involved. Example : Apples are bought at one price but not fully delivered. The market price increases and you must now pay a higher price. The differences in prices are the compensatory damages. 3. Consequential damages damages that you realize as a consequence of the breach of the contract. Compensatory damages are calculated by taking the difference between the contract price and what the customer would pay somewhere else. Additional consequential damages incur [for example] from profits that were lost as a result of the breach of contract. What are the conditions for recovery? a. Must have been contemplated by both seller and customer when contract formed. b. Must be reasonably foreseeable. c. See Schonfeld v. Hillard , Case 18-3, and text at 318 Plaintiff who tries to open a TV network alleges that if the contract in question had been fulfilled, there would have been profits, which are now otherwise lost. Court must weight the facts and decide if the consequential damages will be awarded or whether they are too speculative. 4. Punitive or exemplary damages. a. Punitive damages are used to punish a defendant. i. Must have some intentional or willful misconduct. ii. Usually very fact based. iii. Not typical in contract disputes, and usually involved fraud. b. See Merritt v. Craig, Case 18-1, text at 314 The jury believed a seller of a house lied about the conditions of water damages in the house. Punitive damages applied to punish the defendant. 5. Incidental damages a. Damages not huge in amount but accompany the process of fixing breach of contract [like transportation or storage costs]. 6. Note UCC has specific provisions to follow when determining what damages are appropriate. B. Calculation of Damages. 1. People who provide goods or services are presumed to have an unlimited supply of those goods or services and are therefore under general obligation to provide all goods for which they are contractually bound. C. Special Circumstances for Damages 1. Is there a duty to mitigate ? a. Under UCC you have a duty to take reasonable steps to reduce your damages. Sometimes parties do not have an obligation to mitigate damages. b. In NY, landlords do not have to mitigate damages. 1 c. Who has burden of proof? i. Depends on jurisdiction and case. 2. Is there a liquidated damages clause ? a. Parties agree in advance as to what damages will be....
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This note was uploaded on 02/21/2008 for the course AEM 3200 taught by Professor Grossman,d. during the Fall '07 term at Cornell University (Engineering School).
- Fall '07
- The Land