REMEDIES OUTLINE
INTRODUCTION TO REMEDIES
COMPENSATORY DAMAGES
(A) Rightful Position Principle
(B) Value as the Measure of the Rightful Position
(C) General Damages
(D) Consequential Damages
(E) Limitations on the Rightful Position Principle
(1) Avoidable Consequences
(2) Offsetting Benefits
(3) Collateral Source Doctrine
(4) Scope of Liability
(F) Compensatory Damages When Dollars Cannot Measure Value
(1) Personal Injuries & Death
INJUNCTIONS
(A) Preventive Injunctions
(1) Propensity Requirement
(2) Ripeness & Uncertain Consequences
(B) Reparative Injunctions
(C) Structural Injunctions
CHOOSING REMEDIES
(A) Choosing Between Damages & Other Relief
(1) Damages or Injunction?
(2) Damages or Specific Performance?
(3) Damages or Specific Relief?
(a) Hardship to the Defendant (Δ)
(b) Other Policy Issues: insolvency, Prior Restraints, Jury Trial, Multiplicity of Suits
(B) Preliminary or Permanent Injunctions
(1) Substantive Law of Preliminary Injunctions & Temporary Restraining Orders (TROs)
(2) Procedural Law of Preliminary Injunctions & Temporary Restraining Orders (TROs)
(3) Prospective or Retrospective Relief
(a) Suits Against Officers in their Official Capacity
DECLARATORY JUDGMENTS
RESTITUTION
(A) Preventing Unjust Enrichment
(1) Quasi-Contract & Accounting for Profits:
(a) Forcing Defendant (Δ) to Disgorge Profits
(2) Constructive Trusts
(B) Tracing Defendant’s (Δ) Benefit: Restitution & Insolvency
(C) Subrogation
(D) Indemnification
(E) Contribution
(F) Replevin & Ejectment
PUNITIVE DAMAGES
ANCILLARY REMEDIES
(A) Contempt
(1) Three Kinds of Contempt
(2) Perpetual Coercion
(3) Anticipated Injunctions
(4) Collateral Bar Rule
(5) Rights of 3rd Parties
(B) Obtaining the Remedy Awarded
(1) Drafting Injunction Decrees
(2) Execution & Garnishment
(C) Litigation Expenses
(1) Fee Shifting Statutes
(2) Attorneys’ Fees: Common Fund Cases
(3) Ethical Issues in Fee Awards
REMEDIAL DEFENSES
(A) Equitable Defenses Generally
(B) Laches
(C) Statutes of Limitation
(1) Continuing Violations
(2) Discovery Rule
(3) Fraudulent Concealment
REMEDIES IN CLASS ACTIONS: Fluid Class Remedies
INTRODUCTION TO REMEDIES
Elements Required for Π to Get Relief:
Establish a violation of a substantive right; &
Establish the basis for any remedy the party wants the court to award.
Classification of Remedies
Compensatory Damages ($$$)
Purpose:
Compensate Π for losses sustained.
Punitive Damages ($$$)
Purpose:
Designed to punish & deter wrongdoers in cases involving outrageously bad conduct.
Coercive Remedies
Purpose:
Create obligation (backed by contempt charges) to perform specific act or refrain from performing specific act
Examples:
Injunctions, Specific Performance, Equitable Replevin
Restitution
Purpose:
Disgorge Δ’s “unjust enrichment” from an intentional wrongdoing.
Measurement:
Restitution takes away Δ’s gains, rather than compensating Π’s losses.
Declaratory Relief
Purpose:
To obtain declaration of rights or legal obligations b/w parties when “justiciable controversy” is present
Ancillary Remedies
Examples:
Execution, Garnishment, Attorney’s Fees
COMPENSATORY DAMAGES
(A) Basic Principle: Restoring Π to Rightful Position
“Rightful Position” Rule: The fundamental principle of compensatory damages is to restore the injured party, as nearly as possible, to the position that he would have been in had it not been for the wrong of the other party.
United States v. Hatahley (10th Cir. 1958) ~
Facts:
US Government wrongfully sold Native Americans’ horses to glue factory. Native Americans sought compensatory damages for horses, losses caused by not having the horses, & mental pain & suffering.
Procedural Posture:
District Court:
Awarded …
$395 per horse;
$3500 per Π for pain & suffering;
½ of the value of the diminution of herds because the horses were gone.
Rationale for Award …
Unique animals with specialized training;
Market was limited to the Navajo
Rule:
The fundamental principle of damages is to restore the injured party, as nearly as possible, to the position he would have been in had it not been for the wrong of the other party.
Holding:
“The Π’s were entitled to the market value(or replacement cost) of their horses and burros at the time of the taking, plus the use valueof the animals during the interim between the taking and the time they, acting prudently, could have replaced the animals.”
Ä “Open-Market” Rule:
Market value is considered region-wide
Therefore, the specialized training of the Navajo horses was to be ignored.
Ä “Prudent Replacement” Rule:
The use value of the loss due to the Π’s lack of horses is to be measured for the time between the time of the taking & the time of prudent replacement.
This rule illustrates the Π’s duty to mitigate.
Policy Reasons for “Rightful Position” Rule:
Corrective Justice
Force law violators to take account of the harm they inflict
Economic Theory:
Ä Victims should be compensated because this helps produce the right level of enforcement activity, and because potential victims knew they would not be compensated, they would take excessive safety precautions of their own to avoid being injured.
(B) Value as the Measure of the Rightful Position
Methods of Locating the Π’s Rightful Position:
Replacement in Kind
Repairing the Item
Market Value of Pre-Loss Item
United States v. 50 Acres of Land (USSC 1984) ~
Rule: When market value of condemned property is ascertainable, replacement in kind is not required.
Ä Deviation from the market value measure has been required only when …
Market value is not ascertainable (i.e., too difficult to find); or
Its application would result in a manifest injustice to the owner or the public.
Rationale:
MV rule reduces the risk that Π gains a windfall.
MV rule creates an “objective standard that disregards subjective values which are only of significance to an individual owner.”
Proving Market Value:
Price quotations in active market for the same/similar property; Estimates of experts; Estimate of owners
O’Brien Bros. v. Helen B. Moran (2d Cir. 1947) ~
Facts: Π’s barge was sunk in a collision with a US Navy vessel. US Navy was 80% responsible. The collision occurred during WWII when barges could not be purchased. The barge cost $43,000 to repair, but (after 12 years of depreciation) was now worth only $16,000.
Holding: US Navy was held liable for 80% of $16,000 & not 80% of total repair costs ($43,000) because it made no sense to spend $43,000 to repair a barge worth only $16,000.
Taken together, 50 Acres & the Helen B Moran illustrate the fundamental principle that the Π is entitled to be
Rule:
Where special damage naturally & proximately resulted to Π from the sale of the land & termination of the lease & such damage was in contemplation of the parties at the time of the contract, special damages are appropriate.
Ä Special Damage = Extra Expense & Damage if Reasonably Foreseeable
Uniform Commercial Code:
§2-715(2)ð Consequential damages are provided if “at the time of contracting [the seller] had reason to know”
§2-708(2)ð Seller is entitled to lost profits if reasonably foreseeable.
Meinrath v. Singer (S.D.N.Y. 1980) ~
Facts:
Π sued Δ for money entitled to Π under the contract & for consequential damages resulting from business ventures which floundered without the cash Π needed.
Holding:
“We hold that as a matter of law, Π’s consequential loss is too remote from the main injury to be compensable & too speculative to be ascertainable; Π is barred from recovering such damages.”
Texaco v. Pennzoil (Texas 1987) ~
Rule:
One who is liable to another for interference with a contract is liable for damages for:
Pecuniary loss of benefits of the contract; &
Consequential losses for which the interference is a legal cause. ~ §774A of Rest. of Torts.
Hadley v. Baxendale (Eng. 1854) ~
Rule: Π entitled to recover for consequences of breach that were w/in contemplation of the parties when they made contract.
(E) Limitations on the Rightful Position Principle
(1) Avoidable Consequences
Avoidable Consequences:
What?
Majorityð Treats avoidable consequences doctrine as an affirmative defense.
Minorityð Treats avoidable consequences doctrine as an element of damage calculation.
Example?
Rockingham County v. Luten Bridge Co. (4th Cir. 1929) ~
Holding: Because Π could have plausibly avoided all consequences of the county’s cancellation of the contract to build the bridge, Π was limited in damages to expenses (and opportunity cost) spent before notice of cancellation.
Analytical Questions:
(1) What was the harm?
(2) Could Π have avoided some of the injury?
(3) If Π & Δ were equally situated to avoid the harm, who will be required to act?
SJ Groves & Sons Co. v. Warner Co. (3d Cir. 1978) ~
Facts:
Π filed a breach of contract, claiming extensive losses because of Δ’s failure to deliver adequate supplies at scheduled times:
Δ, in bad faith, deliberately over-committed ability to manufacture & deliver enough concrete to Π.
Δ provided an inadequate number of trucks to service Π’s project.
Δ followed a policy of providing delivery at only 75% of the ordered rate.
Rule:
Uniform Commercial Code:
