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LAW 122 (614)
Chapter 12

Chapter 12 Notes

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Ryerson University
Law and Business
LAW 122
Kernaghan Webb

Chapter 12: Contractual Remedies One or more remedies may be available if a contract is breached. Refer to Figure 12.1 pg 258. D AMAGES In the vast majority of cases, the remedy for a breach of contract is damages. o Damages: is an award of money that is intended to cure a wrongful event, such as a breach of contract. The nature of the remedy needs to be stressed. Expect in rare cases, the plaintiff is not entitled to receive the exact thing that it expected to get under the agreement. Only entitled to monetary value of that thing. E.g. if I agree to sell my car to you, but later break my promise after you have paid the price, you are probably not entitled to get the car itself, but are entitled to the monetary value of that car. There are several reasons why courts usually award only monetary damages for a breach of contract. i. The courts of law historically did not have the power to compel a defendant to do anything other than pay money. ii. Contracts traditionally were seen as commercial arrangements bt business people. Today $$ is the only thing that matters in the business world. iii. Especially in the business world, it would often be inconvenient to award something other than monetary damages. Expectation Damages There are many different measures of relief, or ways in which the courts can calculate the amount of money that the plaintiff is entitled to recover from the defendant. The most common measure of relief in contract law is expectation damages. o Expectation Damages: represent the monetary value of the benefit that the plaintiff expected to receive under the contract. Are forward-looking bc they are intended to place the plaintiff in the position that it expected to be in after the contract was properly performed. Consider the difference bt compensatory damages; which are backward-looking (chpt3) and expectation damages: Backward-looking damages are easily justified. They allow the plaintiff to recover the value of something. E.g. favourable reputation or a broken leg, that it previously enjoyed, but lost as a result of the defendants wrongful act. Forward-looking damages go further allows the plaintiff to recover the value of something that is never previously enjoyed, but merely expected to receive under the contract with the defendant. Expectation damages therefore provide an assurance that if a promise is not actually fulfilled, the innocent party will at least be able to recover the monetary value of the promise. Refer to Figure 12.2 Calculations of Expectation Damages pg. 259 E.g. suppose you agree to pay $5,000 for a computer that is really worth $7,000. You expect to make a profit of $2,000. However, if the vendor breaches the contract by refusing to deliver the computer, and if you have not yet paid the price you are 1 of 7 www.notesolution.com
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