Chapter 18

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Chapter 18
2012-05-29 21:52:32
Chapter 18

Chapter 18
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  1. Compensatory Damages (4 elements)
    Contract damages placing the NBP in as good an economic position as he would have been in if the BP had performed. Formula: (1)Loss of Value - (2)Costs Avoided + (3)Incidental Damages + (4)Consequential Damages (these are iffy)
  2. Loss of Value
    • Difference between Market Value & Contract Price
    • * MV - K Price for Buyer Award
    • * K Price - MV for Seller Award
  3. Costs Avoided
    Costs the NBP avoids by not having performed the K
  4. Incidental Damages
    Arise directly out of a breach
  5. Consequential Damages
    Normally considered lost profits to NBP. Hard to prove and very iffy since court doesn't want to punish BP.
  6. Limits on Recovery of Consequential Damages
    • * Foreseeability of Damages - NBP must prove that the BP had actual reason to know at the time the contract was made that the NBP would suffer this type of loss if a breach occured
    • * Certainty of Damages - NBP must prove the amount of this type of loss w/ reasonable certainty.
    • * Mitigation of Damages - NBP must prove that this type of loss could have been avoided by reasonable effort on the part of the NBP.
  7. Other Types of Damages
    • Reliance Damages - Place NBP in as good a position as they would have been if contract had NOT been made.
    • Restitution - Recovery of benefits the NBP conferred to BP
    • Nominal Damages - a small sum awarded where a contract has been breached but the loss is negligible or unproved.
    • Punitive Damages - Generally not recoverable fo K's
    • Liquidated Damages - damages agreed to in advance by the parties to a contract; will only be enforced if the amount is reasonable.
  8. Two Situations where NBP May Seek Restitution
    • 1.) Voidable K's - a party avoids a contract may get restitution for any benefit conferred to the other party
    • 2.) Statute of Frauds - if K is unenforceable b/c of the SOF, a party may recover the benefits conferred on the other party in reliance on the contract
  9. Remidies in Equity (3)
    • Available only where there is no adequate remedy at law (e.g. money won't suffice)
    • *Specific Performance, Injunction, Reformation
  10. Specific Performance
    Court decree ordering BP to render promised performance.
  11. Injunction
    Court order prohibiting BP from doing a specific act. Can't require BP to do something, only to NOT do something. (e.g. can't force singer to sing at place A but can make them not sing at place B if it would breach contract with place A)
  12. Reformation
    Court order correcting a written contract to conform with the original intent of the contracting parties.