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Contracts
University of Florida School of Law
Dawson, George L.

OUTLINE
 
REMEDIES
 
DAMAGES GENERAL p.61-66; 71-78
·         Expectancy – put in position would have been in had the contract been completed; “benefit of the bargain”; Profit
·         Reliance – put the promise back in the position in which the promise would have been in had the promise not been made; what you put out to start performing the K
·         Restitution – can look like reliance; get back any benefit (Market Value) given to the other party; does not take into account the lost profit
·         Do not put the non-breaching party in a Better position
·         Hawkins v. McGee p.61 (D, doctor, guaranteed to make the hand 100% perfect after a skin graft; the surgery did not produce a 100% perfect hand and P is suing D for damages including damages for pain and suffering)
o       Harry Hand
o       Expectancy
§         Have                                  Expect
§         Big scar                             scar
§         Longer stay                       2 day stay
§         Worth 1.98                        worth 10
§         More pain and suffering   pain and suffering
§                                                   Pay for operation
o       Have + 1500 = Expect
 
·         P. 70                    Book ($15 mkt)
A————————–àB
                         ß————————
                     notes – 3 to make; 1 mkt value; $10
 
If B performed and then A breach:
Restitution = 11 (10 + 1 mkt value) look at what A got
Reliance = 13 (expenses in performing)
Expectancy = 15 (b/c already gave up 13 and profit was 2)
 
If B didn’t perform yet except copy notes and give to A and A breach:
Restitution = 1
Reliance = 3
Expectancy = 5 (3 make and 2 ahead he would have been)
 
If B did nothing and A breach:
Restitution = 0
Reliance = 0
Expectancy = 2
 
·         Expectancy = amount expected to be paid – amount saved b/c of breach or amount spent + expected profit
·         J.O. Hooker & Sons v. Roberts Cabinet Co. p.71 (Renovation of a house; Hooker enter into subcontract agreement with Cabinet Co.; Except for damages for the storage of the cabinets, damages awarded put D in as good a position as he would have been)
o       Sometimes ambiguous goods v. services
o       Lost profits – there is no concrete % – not clearly law – just 2 opinions
o       Damages = lost profit + expenses incurred that are unable to be mitigated
·         UCC – sale of goods only
·         Common Law – not goods – Restatement (not binding, guideline)
 
DAMAGES: THE UCC p.79-86
 
·         Tongish v. Thomasp.79 (seeds)
o       Proper measure of damage is the difference in market value and contract price
o       When two statutes apply and they are inconsistent, the more specific statue wins
o       G.R. – the purpose and intent of the legislature govern
o       Coop (seed purchaser who delivers to Bambino) wants§2-713; code says he can cover under 712 or 713
o       Tongish only wants to pay .55 – the true expectancy
o       Coop wants to use the marked price (713) when deciding expectancy
o       Coop has Bambino contract; ultimately doesn’t matter, but D makes a bid deal about
 
DAMAGES: FORSEEABILITY p.86-90; 97-101
 
·         Three limitations on Expectancy Damages
o       1) Remoteness of foreseeabiltiy of harm – Hadley
o       2) Uncertainty of harm; can’t for sure say what profits would be – Dempsey
o       3) Avoidability of Harm – Rockingham
·         Expectancy cap on Reliance
·         Employment contract – mitigation required
·         Hadley v. Baxendalep. 86 (Sent broken part of mill and carrier got it there late)
o       P’s are only entitled to recover the measure of damages both parties may reasonably foresee as a result of the breach
o       Here lost profits not reasonably foreseeable b/c no special contract made; no understanding of a special c

performance
·         Angelia Television Ltd. V. Reedp. 118 An unusual case! (P made arrangements in advance of taping and before signing D to do a movie; claim was for wasted expenditures not lost profits – b/c too hard to calculate; TV could recover all – even costs before signing Reed; Reed appeals; appeal dismissed)
o       Damages are not recoverable for loss beyond an amount that the evidence permits to be established with reasonable certainty
o       Can claim expenditures before signing if can be proven that it could reasonably be in the contemplation of the parties as likely to be wasted if the K was broken
o       Reed must have known that expenditures had already been incurred on director’s fees and the like
·         How distinguish Dempsey and Reed?
o       Dempsey – only one heavyweight boxer
o       Reed – is said no they could have found another actor, but he quit so late they had not time to find a replacement
·         Mistletoe Express Service v. Locke p. 120 (Original D; Original P) (For original P) (K provided that Locke would perform pickup and delivery services for Mistletoe; Locke made investments and expenditures so can perform the K; lost profits for K b/c of theses expenditures/investments)
o       As long as reasonable will get Reliance
o       Generally won’t get Reliance for expenses before the K is formed
o       Can you have reliance in excess of expectancy if it will put you in better position? Is there an expectancy cap? Yes
If D had proven the lost profits that amount would have decreased the