Week 9 - AEM 3200 WEEK 9 Remedies for Breach of Contract...

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I. Remedies for Breach of Contract A. Calculation of damages A. 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. B. Special Circumstances for Damages i. Is there a duty to mitigate? 1. Under UCC you have a duty to take reasonable steps to reduce your damages. Sometimes parties do not have an obligation to mitigate damages 2. In NY, landlords do not have to mitigate damages. 3. Who has burden of proof? A. Depends on jurisdiction and case but usually breaching party has duty to prove mitigation. B. See Parker v. 20th Century Fox, Case 20-4 - where offer of different acting job didn't constitute an equivalent performance so no duty to mitigate. ii. Is there a liquidated damages clause? 1. Parties agree in advance as to what damages will be 2. When are they enforceable? i. When reasonable. ii. When actual amount of potential damages hard to predict when contract formed. 3. When is such a clause a good idea? A. In the process of negotiating a contract it may make sense to figure out- damages ahead of time if those damages are hard to project. 4. See also JMD Holding Corp. where the court must determine whether the clause IS a valid liquidated damages provision or an unenforceable penalty. iii. Note UCC 2-718 which may shape the nature/enforceability of such a clause. C. Rescission and restitution 1. Terminate the contract (rescission) and return parties to their original position (restitution). 2. Party can also recover damages if s/he can prove them - these remedies are not necessarily mutually exclusive. D. Specific performance 1. Court will order performance. 2. Only granted where money damages are inadequate - specific performance is often seen in cases disputing real estate. 3. But see Van Wagner Advertising v. S&M Enterprises. - A billboard has been leased on a busy road in NYC but this lease is reneged. The huge billboard is located at a spot where traffic usually gets backed up during rush hour. Plaintiff argues that the correct remedy is specific performance (assuming a breach of contract has been found). Court says specific performance
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should only apply when money damages are not adequate. In this case, specific performance would not be appropriate because it is possible to find out what the economic loss would be for
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This note was uploaded on 03/03/2009 for the course AEM 3200 taught by Professor Grossman,d. during the Fall '07 term at Cornell University (Engineering School).

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Week 9 - AEM 3200 WEEK 9 Remedies for Breach of Contract...

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