Chapter 19 Breach of Contract and Remedies

Vocabulary flashcards covering key terms and definitions related to contract remedies from the lecture notes.

Expectation damages

The value the injured party would have received if the contract had been fully performed; cannot usually exceed the contract price.

Incidental costs

Reasonable costs incurred because of the breach, such as storage or transportation of materials; recoverable by the non-breaching party.

Consequential damages

Damages beyond the contract that are caused by the breach and are foreseeable by the breaching party.

Loss avoided

The value of resources the non-breaching party salvages or can repurpose to mitigate the breach.

Costs saved

Costs the non-breaching party saved by being excused from performance due to the breach.

Mitigation of damages

The duty of the non-breaching party to take reasonable steps to reduce damages; damages are reduced by what could have been avoided.

Reliance damages

Damages designed to put the non-breaching party in the position they were in before the contract; does not include lost profits.

Restitution damages

An equitable remedy to prevent unjust enrichment by returning the benefit conferred to the other party.

Punitive damages

Generally not recoverable in contract cases; may be awarded only if the breach also involves a tort for which punitive damages are permissible.

Nominal damages

A small sum awarded to acknowledge a meritorious claim when no significant loss is proven.

Liquidated damages

A pre-agreed amount to be paid if a breach occurs; enforceable if reasonable and not a penalty, especially when actual damages are hard to forecast.

Specific performance

An equitable remedy requiring the breaching party to perform as promised, used when monetary damages are inadequate and the subject matter is unique.

Rescission

A remedy that cancels the contract and restores the parties to their pre-contract positions; consideration is returned.

Reformation

Modification of a contract to correct mistakes or misrepresentations, so the contract reflects the true intention of the parties.

Quasi-contract

An equitable principle used when no actual contract exists to prevent unjust enrichment; allows recovery of the value of benefits conferred.

Unjust enrichment

A benefit conferred on one party that would be inequitable to retain without compensating the other party; basis for quasi-contract recovery.