lecture notes ch. 18

lecture notes ch. 18 - Chapter 18 Title:BusLawSeal.eps...

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Chapter 18 Breach of Contract and Remedies C HAPTER O UTLINE I. Damages Damages are designed to compensate the injured party for the loss of the contract or give the  injured party the benefit of the contract—that is, an innocent party is to be placed in the  position he or she would have been in if the contract had been fully performed. A DDITIONAL B ACKGROUND
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Restatement (Second) of Contracts, Section 347 The following is the section of the  Restatement (Second) of Contracts that relates to and is  cited in this part of the text— Restatement (Second) of Contracts, Section 347 . § 347. Measure of Damages in General Subject to the limitations stated in §§ 350-53, the injured party has a right to damages based on his ex- pectation interest as measured by (a) the loss in the value to him of the other party’s performance caused by its failure or deficiency, plus   (b) any other loss, including incidental or consequential loss, caused by the breach, less (c) any cost or other loss that he has avoided by not having to perform. A DDITIONAL B ACKGROUND The Famous Case of the “Hairy Hand” To illustrate the principle that nonbreaching parties are to put in the position that they would have  been in had their contracts been fully performed, professors have long introduced students to   the famous case of the “hairy hand.”  The case concerns an unsuccessful operation on a boy’s scarred  hand.  Damages assessed against the doctor were based on the difference between the value to the boy of  the hand that the doctor had promised and the value of the hand in its condition after the operation.
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Sometimes forgotten in a dry discussion of the underlying principle is the boy whose hand was  operated on. The boy, George Hawkins, suffered an electrical burn when he was 11 years old. The re- sulting scar was small and did not significantly affect the use of the hand.  A doctor persuaded George to  undergo surgery, emphasizing the social problems that the scarred hand might create.  The operation  was performed shortly after George’s eighteenth birthday. The skin graft was taken from George’s chest.  There was infection and considerable bleeding. George was hospitalized for three months. The graft  covered the thumb and two fingers and soon was matted with hair. Movement of the hand was greatly  restricted.   The   jury   awarded   George   $3,000   (approximately   $24,000   in   today’s   dollars).   After   the  Supreme Court of New Hampshire ordered a new trial, the case was settled for $1,400 ($11,200 in  today’s dollars). George’s father took him to specialists in Montreal to see if the appearance of the hand  could be improved, but was advised that nothing could be done.
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This note was uploaded on 09/05/2011 for the course LAW 3000 taught by Professor Ms.zarac.sette during the Spring '11 term at Hawaii Pacific.

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lecture notes ch. 18 - Chapter 18 Title:BusLawSeal.eps...

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