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Contracts
St. Louis University School of Law
Baxter, Teri Dobbins

CONTRACTS
 
contract – set of promises the law will enforce
 
ENFORCE
 
Try to protect the expectation, not in punishing the breaching party
Protect by money damage awards
Give promisee what they expect under the contract, but no more
 
United States Naval Institute v. Charter Communications, Inc. pp. 2-5
 
Charter had a K with Naval to ship the book in October. Charter breaches K and ships book in September – caused Naval to sell less copies than it would have sold. Naval cannot ascertain exactly what it lost or what decline in sales was because of Charter’s breach.
“purpose of damages for breach of K is to compensate the injured party for the loss caused by the breach… generally,  actual loss, not Δ profit – purpose not to punish, to put party that did no breach where they would have been if no K had been formed
 
R2d 356 – “objective… is compensatory, not punitive”
 
legal advice – should charter breach to make more $$$?
reputation – future K – damages? – fees – awards – ?? = instead, try to modify the K
 
Sullivan v. O’Conner pp 8-14
 
Δ surgeon promise  entertainer that 2 operations will improve her appearance, after a third, she was disfigured, pained, other damages/ expenses. sues for breach of K and negligence. no Negligence, affirmed – was entitled to damages awarded by trial ct. but not expectation – too excessive – doctors would practice “defensive medicine”
 
1.      Expectancy – default measure of damages
                                                                                i.            Presumed, standard measure of damages
                                                                               ii.            Put plaintiff where they expected to be – prettier nose
                                                                             iii.            value of what Δ promised to make 
2.      Reliance – value of paid out and loss suffered
                                                                                i.            Put plaintiff back where they were if the K was never made
                                                                               ii.            Anything they lost in reliance upon the agreement
                                                                             iii.            what  lost by engaging in the K – appropriate
3.      Restitution – non-breeching party gets back anything they paid to breeching party
Is usuall

f it is sought by the promisor in exchange for his promise and is given by the promisee in exchange for that promise.
(3) The performance may consist of
      (a) an act other than a promise, or
      (b) a forbearance, or
      (c) the creation, modification, or destruction of a legal relation.
(4) The performance or return promise may be given to the promisor or to some other person. It may be given by the promisee or by some other person.
 
RULE: “For a promise to be enforceable, it must be supported by a return promise or performance that was sought by the promisor in exchange for his or her promise and was given by the promisee in exchange for that promise”
 
Restatement (Second) of Contracts § 79
 
If the requirement of consideration is met, there is no additional requirement of
(a) a gain, advantage, or benefit to the promisor or a loss, disadvantage, or detriment to the promisee; or
(b) equivalence in the values exchanged; or
(c) “mutuality of obligation.”