Contracts - K Remedies

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Anonymous
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213774
Filename:
Contracts - K Remedies
Updated:
2013-04-15 23:46:26
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Remedies
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1L Contracts - K Remedies
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  1. A valid and enforceable K has been formed + one of the parties has
    committed a breach by failing to perform = a need to determine
    the appropriate remediesand damages
  2. Legal Remedy:
    an award of money damages
  3. Equitable Remedy:
    an order granting specific performance of K (not common)
  4. Principle of Remedies:
    • to make the injured party whole thru compensation for loss caused by the breach
    • *Compensate the injured *no need to punish the breacher
  5. are willful or intentional breaches distinguished from other breaches
    no
  6. are punitive damages awarded
    no
  7. if money damages are an adequate substitute for the injured party...
    specific performance will not be granted
  8. if a non-breaching party suffers no actual financial loss,
    there is no entitlement to damages beyond an award for nominal damages
  9. Which Interests are Protected? R2K §344
    Expectation; Reliance; Restitution
  10. Expectation Damages (formula) =
    P's expected position ex post - P's actual position ex post
  11. expectation damages (definition)
    what the injured party expected to receive if the K had been fully performed 

    a/k/a the benefit of the bargain
  12. which interest represents the greatest measure of recovery
    expectation b/c it includes lost profits
  13. Limitations to Expectation Damages
    Causation: the breach of the K = the cause in fact of its loss

    Loss must be foreseeable and proved with reasonable certainty

    • Party has a duty after the ∆’ breach to make all reasonable efforts to avoid
    • unnecessary damages

    A party may not recover more than the K terms would have provided
  14. Reliance Damages (formula) =
    P's status quo ante - P's actual position ex post
  15. Reliance Damages (definition)
    the injured party's loss caused by reliance on the K and seeks to put the P in as good a position as she would have been in had the K not been made
  16. Reliance damages seeks expenses incurred...
    in reliance on the K by preparing to perform or in performance
  17. Restitution Damages (formula)
    ∆'s actual position ex post - ∆'s status quo ante
  18. Restitution Damages (definition)
    P's interest in having restored to her any benefit she has conferred on the other party
  19. Purpose of Restitution Damages
    prevention of unjust enrichment
  20. When do Restitution Damages arise
    If a party has changed position in reliance on the K and has also conferred a benefit on the other party, the court may require the other party to disgorge the benefit received by returning it to the party who conferred it
  21. Restitution damages are generally smaller/bigger than expectation or reliance damages because...
    smaller - it doesn't include party's lost profit nor reliance expenditures that conferred no benefit on the other party
  22. Efficient Breach :
    the party in breach gains enough from thebreach to have a net benefit, even after compensating the injured party for its loss
  23. richard posner on efficient breach
    • “Even if the breach is deliberate, it is not necessarily blameworthy.  The promisor may
    • simply have discovered that his performance is worth more to someone else.  If so, efficiency is promoted by allowing him to break his promise, provided he makes good the promisee’s actual losses.  If he is forced to pay more than that, an efficient breach may be deterred, and the law doesn’t want to bring about such a result.”

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