Duty to Mitigate

Duty to Mitigate - I. Duty to Mitigate a. Minimizes damages...

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I. Duty to Mitigate a. Minimizes damages after breach i. Ex: Buyer, Seller must limit damages arising from contract breach b. Who is responsible? Buyer/Seller? i. The party(s) that has the greatest control over the costs should be the party(s) responsible ii. Example: 1. Printer orders highly specialized materials 2. Invests in Reliance by preparing shop 3. Asset non-deliverable c. Performance Excuses Reasons to Excuse (allow w/o penalty) i. Impossibility 1. Physically impossible to fulfill contract a. Printer Example: Manufacturer has a fire, physically cannot deliver the equipment b. If no risk assignment in contract, look for who can best control risks. Who can best control the risk of fire in their factory? The manufacturer. i. Manufacturer must behave efficiently to protect against the risk of fire. c. What if Manufacturer was in New Orleans? i. Seller still cannot deliver, must breach ii. Cannot control hurricane destroying city iii. Who can most easily insure against this risk? Depends
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This note was uploaded on 10/19/2008 for the course ECON 4450 taught by Professor Turnbull during the Spring '08 term at Georgia State.

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Duty to Mitigate - I. Duty to Mitigate a. Minimizes damages...

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