Contents
DAY 1: INTRODUCTION TO THE RIGHTFUL POSITION
I. What is a REMEDY?
A. Anything a court can do for you if you win, or anything a court can do to you if you lose.
B. Remedies give meaning to the obligations imposed by the substantive law—they are the means by which substantive rights are given effect.
C. Basic types of remedies:
a. Compensatory: compensate plaintiffs for the harm through damages
b. Preventative: prevents harms before it happens through:
1. Coercive remedies: coerces a party through injunction
2. Declaratory remedies: resolves disputes about parties’ rights
c. Restitutionary: restores to P all that D gained at P’s expense
d. Punitive: intended to punish wrongdoers
e. Ancillary: aid other remedies: fees and costs
give meaning to substantive law, that is what remedies do.
D. Substitutionary and Specific Remedies
a. SUBSTITUTIONARY: P suffers harm and receives $
1. $ is substituted for P’s entitlement
2. Fact-finder’s valuation is substituted for P’s valuation
Substitutionary is giving you something else.
b. SPECIFIC: prevents the harm or undoes it rather than compensates for it
E. Legal and Equitable Remedies(arbitrary distinction sometimg
a. Legal: damages
b. Equitable: injunctions
c. Restitution is sometimes legal, sometimes equitable.
II.
● LAYCOCK says:
It’s true that economic incentives matter—some people will only obey the law is the consequences of the violation are more painful than obedience.
But the law has a normative function—there is moral force behind it, at least for most of us.
III. Hatahley v. United States (1958)
-P can only recover for what they lost, they need to prove something…use market value…not enough contention in court as to the specialness
A. Facts
a. U.S. rounded up Ps’ unique horses and made glue without giving Ps proper notice. The district court awarded damages for each horse and uniform amounts for Ps’ pain + suffering.
b. No right to trial by jury under FTCA, so bench trial. Judges have to give reasons for their decisions (juries don’t).
c. Court of Appeals sent it back to a different district judge for a more precise award of damages.
d. Ps live in a barter economy, but unique horses can be traded for other animals with a market value.
B. Why the Court of Appeals remanded—question is what to do on remand.
a. The Court of Appeals thought the judge wasn’t using market value, so the standard of putting the P in their RIGHTFUL POSITIONS wasn’t met.
b. The Court of Appeals also says the judge should not have homogenized Ps’ EMOTIONAL DISTRESS.
1. But isn’t it impossible to accurately assign a dollar amount on each Ps’ emotional distress?
2. We don’t know that the award is wrong, and an imprecise award does more justice than no award.
C. PRECISION v. EFFICIENCY.
Always P position to show, exactituted
If we have too strict
a. Goal of damages, for the most part = restore P to position he would’ve occupied but for the wrong. “P’s rightful position” =standard we have chosen for corrective justice. We need a standard because:
a. Market economies require predictable legal rules to function
b. Due Process concerns: potential litigants need notice of the rules.
b. How precisely to measure the rightful position is the core of the debate. Too little precision and P is denied due process, too much precision and some P don’t recover at all or enough (harm is unremedied and the D is undeterred).—it is about being as precise as possible….
There is a conflict between the ECONOMIC THEORY and the CORRECTIVE JUSTICE THEORY of remedies.
Do we compensate people because:
It adjusts economic incentives to potential defendants; or
It’s the right thing to do?
Do we want:
The optimal number of violations (economic theory); or
The smallest number of violations (corrective justice)?
● ECONOMIC THEORISTS say we should encourage profitable activity, even if the activity violates the law and harms others, so long as law violators pay for the damage they cause (internalize externalities). Activity that is profitable even after payment of all costs it imposes on others is EFFICIENT or ECONOMICAL. Remedies should take account for all costs put on plaintiffs it is about,
● CORRECTIVE JUSTICE THEORISTS say that people should not be made to suffer for other’s wrongdoing, and if we restore P to his rightful position, he will not suffer. More is a windfall, less leaves the wrong unremedied. It about following the law….
D. Working goal of the system is as precise a standard as we can reasonably work with and still be provable damages.
E. Not PUNISHMENT: that’s left to criminal law—the goal of civil justice system is to compensate P, not to punish the D. To do that, we need to use a separate set of rules + remedies. The trial judge was outraged at the government’s behavior, but he can’t just toss in extra money + call it “compensatory damages” (although a jury might be able to).
F. ONE-SATISFACTION RULE: P can only recover for each item of damage once, even if he has multiple legal theories against multiple defendants. One remedy for one injury…no double recovery
These are under the set off rule—-
a. PRO TANTO: nonsettling Δs get $ for $ credit for settlement toward damages
b. PROPORTIONATE FAULT: each Δ is liable for the % of damages matching her % of fault
***Goal of COMPENSATORY DAMAGES is to restore P to her RIGHTFUL POSITION***
DAY TWO: VALUE
I. Usual measure of VALUE is market value, not replacement cost, not subjective value to the owner, not repair costs in excess of value. Market value is the strong indicator, but it is not necessarily dispositive always, but most of the time.
a. General rule is that rightful position = value of what you lost, not what it costs to replace it.—
A. Hatahley awarded replacement cost, but that was a proxy for market value in this case—the Ps lived in a barter economy, and replacement cost was set by the market value of what the horses could be bartered for.
FAIR MARKET VALUE: price set by a willing buyer and a willing seller (US v Miller) without compulsion to buy/sell in the market at the time of the wrong. P must be made whole, but D is entitled to make P whole in the least expensive way.
B. U.S. v. Fifty Acres of Land
a. Facts
i. Eminent domain case. Landfill condemned, city acquired a better site and facility, and sought the cost of the replacement facility.
ii. Takings Clause says just compensation, so the government doesn’t have to pay for a substitute landfill—only the cost of the condemned land fill.
iii. Incidental and consequential damages are never compensated under the Takings Clause.
b. Case poses the issue of market value versus replacement cost. General rule is that rightful position = value of what you lost, not what it costs to replace it.
i. But if the function of the landfill must be replaced, and the value of the old landfill is not sufficient to replace the
TUATING VALUE.
a. Value changes over time. General rule is VALUE OF PROPERTY AT THE TIME OF THE WRONG. This works for gradual changes in value like deprecation and inflation.
b. It also works for when there’s a sudden price swing in a sales contract. In such a contract, the price term and delivery-date allocate the risk. The general rule still applies.
c. CROP RULE = use the value of the crops at the date of harvest. Subsequent price increases are not considered. Application of the general rule.
B. Decatur County: P habitually held his crops for a year as speculation. Court says the risk inherent in speculation is not chargeable to the defendant.
Time at the time of harvest
1. Time of loss, but if not available, first time we can calculate.
2. If there is achange, in price, risk allocation is with the wrong-doer….
C. But some things are known to fluctuate rapidly in value, and the general rule seems arbitrary. Then courts look for other solutions. For RAPIDLY FLUCTUATING VALUES like securities, the measure is the highest value between the time of the wrong and a reasonable opportunity to replace.
In all of these the absolute last time is the reeoanble time to cover….
IV. VALUE OF TIME (not covered in class)
A. D is entitled to an offset for any expenses that P saved as a result of the loss.
B. Claims for value of time often in the form of labor costs. This is complicated when employees multitask—a court that insists on detailed proof of how time was spent will make recovery impossible for most Ps.
V. COMPETING MEASURES OF VALUE
A. Choosing between competing measures of damages should not be a matter of deciding the “rule” for this kind of case. It is often a matter of figuring out whether one measure omits an element of loss or the other measure counts some element twice.
B. Whenever damages depend on the value of a work in progress, damages based on costs already expended plus a profit should equal damages based on value minus cost of completion.
DAY THREE: RELIANCE AND EXPECTANCY
We also have restitution position, which is the D rightful position…..we take away undue benefit, it goes both ways….cuts both ways, start from the begining.
I. What is the RIGHTFUL POSITION when D promised to change P’s position?
RELIANCE: position that P would have occupied if the promise had never been made. (swhen expectancy cannot not be shown)
RST of K says that if we have an expectancy that is lower, that you would have lost money then we subtract from reliance that amount.
1. Expenses necessary to perform the contract = essential reliance
2. Other expenses = incidental reliance (e.g., gains from forgone opportunities)
B. EXPECTANCY: position that P would have occupied if promise had been performed
C. TORT v. CONTRACT
