Contracts1-Remedies - CONTRACTS I Kniffin Fall 2003...

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CONTRACTS I Kniffin Fall 2003 REMEDIES I. Remedies A. 2 Goals of Contract Remedies 1. Compensation to the victim of a breach, not punishment of the party in breach 2. Expectation : Injured party should get the relief it expects, or the relief equal to what it would have gotten had the contract not been breached B. Types of Remedies 1. Punitive Damages – only when there’s a tort involved 2. Compensatory Damages i. Specific Performance -- unusual step of ordering item contracted for be delivered Requirements for awarding Specific Performance : 1. Money damages are not adequate to achieve justice in the case o Can be shown by uniqueness (i.e. a contract for a specific Rembrandt painting) or great difficulty in covering (rare coins) 2. The performance itself does not require too much supervision by the court o No blueprints to follow 3. The terms of the contract itself must be clear enough so that the court can write a clear decree/order for specific performance o Court may not know how to write a court order to “run a business sensibly and properly” 4. It must not be a situation of forcing antagonistic individuals to work together ii. Monetary Damages -- usual damages awarded by courts a. 3 Types 1) Expectation -- Puts you forward in time as if the contract had never been breached (remedy usually given by courts) U.C.C. Rule of Damage Awards Cover Formula : The difference between the contract price and the price of the cover goods (+ any consequential or incidental damages) + Consequential Damages Remote Damages; Chain-reaction Damages, that could not have been covered Requires Foreseeability + Incidental Damages Expenses connected with cover, separate from the cover itself Transportation, care and custody of goods, etc. * Courts do not compensate for intangible damages, such as worry or inconvenience. 1
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* To Cover – An injured buyer purchases substitute goods 2) Reliance - - Puts you back in time as if the contract had never been made 3) Restitution (Unjust Enrichment, Quasi-Contract) - - Buyer gets back any fee already paid: restoring an unjust benefit that the plaintiff had given to the defendant Restitution Requirements 1. A benefit was received by the defendant. 2. The benefit was at the plaintiff’s expense. 3. It would be unjust to allow the defendant to retain the benefit without making compensation (or returning it). 4. The benefit was not intended as a gift (the plaintiff expected something in exchange) * Webb v. McGowin No Restitution – We don’t know if benefit was intended as a gift * Mills v. Wyman No Restitution – Benefit was probably intended as a gift Plastic Surgery Goes Bust: Court Incorrectly Rules Reliance Damages Sullivan v. O’Connor o This Court does not give expectation damages, an unusual ruling o It treats the case as if plaintiff did not waive her claim to expectation damages o Court reasons that because the doctor was not negligent, we will not use the expectation formula -If this had been correctly ruled as________, then plaintiff would have recovered:
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Contracts1-Remedies - CONTRACTS I Kniffin Fall 2003...

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