Contracts
Course Outline
Professor Mench
Spring 2004
UNIT ONE: REMEDIES
I. Expectation Interest (Expectancy)
Hawkins v. McGee (Hairy hand case)
FACTS
McGee performed an operation on Hawkins hand and promised it would be 100% perfect after the operation and healed in three to four days, but the operation was unsuccessful.
PROCEDURE
B/f jury started to hear any evidence, the defendant made a motion for a nonsuit – 2nd claim dropped (2 counts brought)
assumpsit – breach of contract
negligence – tort – this second one was thrown out. 12(b)(6) motion.
HOLDING
The purpose of awarding damages for breach of contract is to put the plaintiff in as good a position as he would have been in had the defendant kept his contract
McGee’s words indicate the giving of a warranty and with the evidence showing he solicited the opportunity to perform the operation, there is a reasonable basis for a jury to conclude that McGee spoke the words with the intention that they be taken at face value
The jury instruction was erroneous
The measure of recovery is what the defendant should have given the plaintiff
The measure of damages is the difference between the value of a perfect hand and the value of his hand in its present condition
Measure = VP/VD (value promised – value delivered)
The measure of damages is the actual loss sustained by reason of the breach, which is the loss of what the promisee would have made if the contract had been performed, less the proper deductions
This case is important is areas of jury control and instructions
The court says expectancy is the appropriate measure of damages
Claim based on negligence and assumpsit (breach of promise) but negligence was dismissed and went ahead on breach of contract
ISSUES:
Is there a contract? Two bases for possible contract
3 or 4 days prediction (judges decide not a contract)
100% perfect
Measure of damages?
Defendant argued that as a matter of law a doctor’s opinion is not a contract
Court decides that don’t have to decide based on the language alone, therefore, even though shouldn’t be held to 100% comment, because solicited patients could be held a contract
Doctor is self-interested, he wants to experiment– market-like behavior, salesman
Ther
Expectation interest: interest of a party in realizing the value of expectancy that was created by the other’s promise (Hawkins)
Reliance interest: interest in recovering losses suffered by virtue of reliance on the contract, whether or not there was a corresponding gain to the opposite party
Restitution interest: interest of a party in recovering values conferred on the other party through efforts to perform a contract, compensation or reimbursement, restoration of some specific thing
Groves v. Wunder
FACTS
Wunder paid Groves a fee to remove gravel from Groves’ property but Wunder failed to regrade the land according to the contract. Groves is giving Wunder a seven year lease in exchange for no competition and allows him to take whatever sand and gravel he wants in exchange for $105,000 and an agreement to level the soil in the land. Instead it is left rugged and uneven and only the best gravel has been removed.
HOLDING
When a construction contract is defectively performed then the measure of damages is the cost of remedying the defect
