Contracts Outline

CONTRACTS OUTLINE
 
CHAPTER I. BASIS FOR ENFORCING PROMISES
 
REMEDIES-
 
Assumptions made by courts in enforcing promises:
                                                               i.      Compensation: Law is concerned mainly with the relief of promises to redress breach and not with the punishment of promisors to compel performance.
                                                             ii.      Expectation principle: The relief granted to the aggrieved promisee should generally protect the promisee’s expectation by attempting to put the promise in the position in which it would have been had the promise been performed.
                                                          iii.      Substitution principal-The appropriate form of relief is substitutional, in the form of a judgment awarding money damages to be paid to the aggrieved promisee, rather than specific, in the form of a court order directing the promisor to perform its promise. This relief is based on something other than mere compensation.
                                                           iv.       Specific Performance- When money is not an adequate remedy, the court will order the defendant to perform. Courts rarely use specific performance (Restatement says that performance should not be awarded when damages would be adequate to protect the expectation interest of the injured party). Land dispute cases often call for specific performance.
 
U.S. Naval Institute v. Charter Communications-
                                                               i.      Naval, the assignee of the author’s copyright in Red October, entered into a licensing agreement with Berkley in September 1984. The agreement granted Berkley the exclusive license to publish a paperback edition of the book “not sooner than October 1985.” Berkley shipped copies of the paperback early, which ultimately led to sales of the paperback copy in retail stores.
                                                             ii.      Issue: Did the trial court correctly calculate and reward Naval sufficient damages?
1.      Court ruled that trial court should have only used profits that resulted from sales to customers that otherwise would have bought the hardback book.
2.      Court correctly awarded actual damages by basing it on previous month’s sales.