Chapter 12: Contractual Remedies
entitled to receive $2,000. And if you paid the entire price ($5,000) before the breach,
you will be entitled to $7,000 cash. In either event, you are entitled to enjoy the
In some situations, however, the exercise is much more difficult. We will consider five issues:
i. Difficulty of Calculation:
oExpectation damages are usually available even if they are very difficult to calculate.
E.g. In one famous case, the defendant breached a contract by depriving the plaintiff
of an opportunity to win a beauty contest. While the plaintiff’s actual chance of
winning the contest was highly speculative, the court awarded expectation damages
based on its best guess as to how she would have fared in the competition.
oIn contrast, if the calculation of the plaintiff’s loss is not merely difficult, but entirely
speculative, a court will not award damages – court of law not a place for wild
ii. Cost of Cure or Loss of Value:
oSometimes it is difficult to decide exactly what the plaintiff expected to receive
from the defendant – there may be a question as to whether the plaintiff expected
to receive a service or the value of the end-product of that service.
oE.g. Case Brief 12.1: Plaintiff rented a piece of land to the defendant for
$105,000. The defendant operated a sand and gravel mine, but is required to
level the land at the end of the least. However, the defendant left huge craters on
the property – cost $60,000 to fill the holes, but the land only worth $12,000 if
leveled. The plaintiff claimed expectation damages should be measured by cost of
cure ($60,000 to fix the land), but defendant said it should be measured by loss of
value ($12,000). The court agreed with the plaintiff – thus awarded him $60,000.
oHowever, judges usually refuse to award damages on a “cost of cure” basis if the
difference b/t the cost of cure and the benefits of the cure is reasonably large. –
Swimming Pool E.g. pg 261-262.
iii. Intangible Loss:
oExpectation damages are difficult to calculate when the plaintiff suffers an intangible
loss as a result of the defendant’s breach.
oIntangible Loss: is a loss that does not have any apparent economic value. E.g. the
anger, frustration, or disappointment that may occur when a promise is broken.
oHistorically, the courts refuse to award damages for intangible losses – the courts did
not traditionally feel comfortable assigning dollar figures to personal emotions.
oRecently, the courts have started to recognize that “peace of mind” is one of the
things that a person may expect to receive under a contract.
→Damages may be available if, contrary to the plaintiff’s expectation, the
defendant performed the contract in a way that caused distress.
→E.g. Awarded expectation damages for a ruined holiday
→However, the courts refuse to award damages for the humiliation or dejection
they may feel as a result of being unfairly fired from a job.
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