Contracts1 - I II CHAPTER I: BASES FOR ENFORCING PROMISES...

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I CHAPTER I: BASES FOR ENFORCING PROMISES II The Meaning of “Enforce” A. Contract : a promise, or a set of promises, for the breach of which the law gives a remedy, or the performance of which the law somehow recognizes as a duty B. Objectives of Contact Enforcement 1. Relief of promises to redress breach and not punishment of promisors to compel performance 2. Relief granted to the aggrieved promisee should generally protect the promisee’s expectation by attempting to put the party in the position they would have been if the K had been carried out. C. Types of Enforcement 1. Specific Performance : Where money would not be an adequate remedy. (i) a court order, under contempt of court contract must be carried out as stated---or jail time. (ii) Exceptional cases only 2. Expectation Damages: as if the K had been carried out. (i) DAMAGES = GAINS PREVENTED – COSTS AVOIDED a. Gains prevented: market value of what the D promised to do. b. Costs avoided: what the plaintiff would have paid if the K was carried out (ii) When gains prevented becomes speculative expectation damages is not an effective remedy. 3. Reliance Damages: put the P in his previous position (i) “out of pocket” remedy (ii) damages reimburse the P for his act of reliance 4. Restitution Damages: reimburse P for money that went into the D’s pockets (i) “unjust enrichment” remedy (ii) most limited remedy of the three 5. Nominal Damages: declaration of the P’s rights (i) P proves a breach of K but fails to prove damages 6. VALUE TO P: Expectation Reliance Restitution D. Punitive Damages?: punitive damages are a means for deterrence, public policy wants to encourage K formation. K breach is not a moral wrong, sometimes promotes efficiency 1. Exception: where a tort is present III Consideration as a Basis for Enforcement A. Fundamentals of Consideration 1. Consideration: the price the promisee paid for the promise 2. History (i) Covenant: enforce K’s under seal. a. No bargain required b. Rationale: Evidentiary: providing trustworthy evidence of the existence and terms of the contract in the event of controversy Cautionay: bringing home to the parties the significance of their acts (ii) Debt: enforce unsealed promises repay a sum of money 1
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a. Rationale: the promisor’s obligation was considered to rest upon receipt of a benefit from the promisee b. inspired the concept that there must be a benefit to the promisor (iii) Assumpsit: cases in which the promisee sought to recover damages for physical injury to person or property on the basis of a consensual undertaking. a. Rationale: remedy misfeasance—the promisor, having undertaken ( assumpsit) to do something, had done it in a manner inconsistent with that undertaking to the detriment of the promisee b. Extended to nonfeasance: provide a remedy when the promisee incurred a detriment in reliance on the promise c. inspired the concept that there must be a detriment to the promisee (iv) Bargain: enforce exchanges of promises
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This note was uploaded on 02/15/2008 for the course LAW 1090 taught by Professor Gegan during the Fall '03 term at St. Johns Duplicate.

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Contracts1 - I II CHAPTER I: BASES FOR ENFORCING PROMISES...

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