Contracts II Intro to Remedies &Expectation Damages

Remedies

Legal means of enforcing a right or compensating for the violation of a right when a party fails to perform a contract.

Expectation Damages

Damages meant to place the injured party in the position they would have been in had the contract been performed.

Money Damages

Compensation awarded to a party in a lawsuit based on the financial loss incurred.

Benefit of the Bargain Damages

Another name for expectation damages; aims to provide the financial equivalent of the promised performance.

Reliance Damages

Compensation for expenses incurred in reliance on a contract, focused on losses suffered due to reliance on promises.

Restitution

Recovering the money value of a benefit conferred upon the breaching party to discourage unjust enrichment.

Liquidated Damages

A predetermined amount agreed upon by parties at the formation of a contract to be paid in case of a breach.

Punitive Damages

Damages aimed at punishing a breaching party and deterring similar conduct in the future.

Equitable Remedies

Non-monetary remedies provided by courts, such as specific performance, rescission, or reformation.

General Damages

Damages that directly arise from a breach, reflecting the lost value to the injured party.

Incidental Damages

Costs incurred by the injured party to mitigate losses resulting from a breach.

Consequential Damages

Indirect damages that arise from a breach, based on additional foreseeable losses.

Costs Avoided

Savings realized by the injured party due to the breach, which can offset damages owed.

Lost Profits

Potential earnings that a party may have reasonably expected to earn had the contract been fulfilled.

Mitigation of Damages

The obligation of the injured party to make reasonable efforts to reduce their losses after a breach.

Foreseeability

A principle in contract law that limits recovery of damages to those that were foreseeable at the time of contract formation.

Specific Performance

A court order requiring a breaching party to fulfill their contractual obligations rather than paying damages.

Reformation

The legal remedy that allows a contract to be rewritten to reflect the true intentions of the parties.

Rescission

The cancellation of a contract, with the goal of returning the parties to their pre-contractual positions.

Analytic Framework

Expectation Damages = General Damages + Incidental damages + Consequential Damages - any losses avoided by the non-breaching party- Limitations on recovery.

General/ Direct Damages

Financial losses that result directly from a breach of contract.

Market Value

The price at which a property would sell in an open market under normal conditions.