Term
| Rest. §347. Measure of Damages Generally |
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Definition
Expectation interest measured by: (1)loss in value TO P of the performance caused by breach or deficiency
(2) PLUS *special, foreseeable losses flowing from breach
(3) LESS any savings occasioned by the breach |
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Term
| Rest. §348(2). Alternatives to Loss in Value of Performance |
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Definition
(2) Breach results in defective or unfinished construction, and loss of value cannot be proven with reasonable certainty, he may recover
(a) diminution in MP caused by breach
(b) OR reasonable cost of completing performance or remedying defects SO LONG AS cost is not clearly disproportionate to probable loss in value to him.
**Ugly fountain- is value to P the MP or the performance itself? What motivated the K? What would reasonably prudent actor do with damages- take the money and run, or get the job done? |
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Term
| Rest. §349. Damages Based on Reliance Interest |
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Definition
| As alternative to expectancy, injured party can get damages based on reliance, including expenditures made in preparation for performance or in performance, LESS any savings occasioned by breach that breaching party proves w/ reasonably certainty. |
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Term
| Rest. §350. Avoidability as a Limitation on Damages |
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Definition
(1) Except as stated in (2), cannot recover damages that the aggrieved party could have avoided without undue risk, burden, or humiliation.
(2) Aggrieved party can still collect damages if they made REASONABLE but UNSUCCESSFUL efforts to cover
*Duty to mitigate, cover. |
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Term
| Rest. §351. Unforeseeability and Related Limitations on Damages |
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Definition
(1) Aggrieved party cannot recover for damages that breaching party did not have reason to foresee. Hadley v Baxendale.
(2) Losses are foreseeable if they follow from the breach in the ordinary course of events, or in special circumstances if breaching party had REASON TO KNOW (i.e., if Hadley had TOLD D how badly they needed the shaft on time)
(3) Court can limit recovery for lost profits to the extent required by justice to avoid disproportionate compensation |
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Term
| Rest. §352. Uncertainty as a Limitation on Damages |
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Definition
| Damages must be proven to a degree of reasonable certainty. |
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Term
| Rest. §353. Loss Due to Emotional Disturbance |
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Definition
| No recovery for emotional harm UNLESS unless the breach caused bodily harm or the K is of a kind where serious emotional disturbance was a particularly likely result from breach. (marriage, counseling, etc.) |
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Term
| Rest. §356. Liquidated Damages |
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Definition
| Damages for breach by either party may be liquidated in K but only if amount is reasonable in the light of the anticipated or actual loss caused by breach AND difficulty of proving loss. A term fixing UNREASONABLY large liquidated damages is unenforceable on grounds of public policy as a penalty. |
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Term
| Rest. §360. Factors Affecting Adequacy of Damages |
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Definition
| To determine if damages are adequate, court considers the difficulty of proving with reasonable certainty, procuring suitable substitute performance w/ money damages, and likelihood that damages couldn't be collected |
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Term
| Rest. §71. Requirement of Exchange; Types of Exchange |
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Definition
(1) to be consideration, performance or return promise must be bargained for
(2) must be sought by the promisor in exchange for his promise.
(3) Performance may be (a) an act (b) a forbearance (c) or creation, modification, or destruction of a legal relation
(4) Consideration may be given TO 3rd party; consideration may be given BY 3rd party. |
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Term
| Rest. §81. Consideration as Motive or Inducing Cause |
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Definition
(1) fact that what is sought does not induce promise does not prevent it from being consideration
(2) fact that promise itself does not induce promisee to comply does not prevent compliance from being consideration. |
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Term
| Rest. §86. Promise for Benefit Received (Promissory Restitution |
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Definition
(1) promise made in recognition of past consideration is binding to the extent necessary to prevent injustice
(2) A promise is not binding under subsection (1)
(a) if the promisee conferred the benefit as a gift or for other reasons the promisor had not been unjustly enriched; or
(b) to the extent that its value is disproportionate to the benefit |
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Term
| Rest. §90. Promise Reasonably Inducing Action or Forbearance (Promissory Estoppel) |
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Definition
(1) Promise which the promisor should reasonably expect to induce action or forbearance of the promisee or a third person and which DOES induce is binding if necessary to prevent injustice. Remedy may be limited as justice requires.
(2) A charitable subscription or a marriage settlement is binding without proof that promise induced action or forbearance. |
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Term
| Rest. §139. Enforcement by Virtue of Action in Reliance (overcoming Statute of Frauds) |
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Definition
(1) Promise which the promisor should reasonably expect to induce action or forbearance and which DOES induce is binding, NOTWITHSTANDING Statute of Frauds, if necessary to prevent injustice. Remedy limited as justice requires.
(2) In determining whether necessary, courts consider:
(a) availability or adequacy of other remedies (particularly cancellation and restitution)
(b) definite and substantial character of action or forbearance
(c) extent to which action or forbearance (or other clear and convincing evidence) corroborates evidence of promise
(d) reasonableness of action or forbearance
(e) foreseeability of action or forbearance |
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Term
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Definition
(1) offer is binding as an option K if
(a) in writing, signed by the offeror, recites a purported consideration, and proposes an exchange on fair terms within a reasonable time; or
(b) made irrevocable by statute.
(2) offer which the offeror should reasonably expect to induce substantial action or forbearance BEFORE acceptance and which DOES induce such action or forbearance is binding as an option K to the extent necessary to avoid injustice (bids and construction Ks) |
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Term
| Rest. §20. Effect of Misunderstanding |
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Definition
(1) No mutual assent if parties attach materially different meanings to term of K, and:
(a) neither party knows or has reason to know meaning attached by other; or
(b) each party knows or has reason to know meaning attached by other.
(2) K enforced in accordance with the meaning attached to them by one of the parties if
(a) that party does not know of any different meaning attached by the other, and the other knows the meaning attached by the first party; or
(b) that party has no reason to know of any different meaning attached by the other, and the other has reason to know the meaning attached by the first party. |
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Term
| Rest. §63. Time When Acceptance Takes Effect (Mailbox Rule) |
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Definition
Unless the offer provides otherwise:
(a) an acceptance made in a manner and by a medium invited by an offer is valid on DISPATCH
(b) an acceptance under an option K is not operative until received by the offeror |
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Term
| Rest. §45. Option Contract Created by Part Performance or Tender |
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Definition
(1) Offer for unilateral K, an option K is created when offeree tenders or begins the invited performance or tenders a beginning of it.
(2) Offeror's duty of performance is conditional on completion or tender of the invited performance in accordance with the terms of the offer. |
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Term
| Rest. §32. Invitation of Promise or Performance |
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Definition
| In case of doubt an offer is interpreted as inviting the offeree to accept either by promising to perform what the offer requests or by rendering the performance, as the offeree chooses. |
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Term
| Rest. §62. Effect of Performance by Offeree Where Offer Invites Either Performance or Promise |
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Definition
(1) Where offer invites offeree to choose between acceptance by promise and acceptance by performance, the tender or beginning of the invited performance or a tender of a beginning of it is an acceptance by performance.
(2) Such an acceptance operates as a promise to render COMPLETE performance. |
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Term
| Rest. §36. Methods of Termination of the Power of Acceptance |
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Definition
(1) Power of acceptance may be terminated by
a. Rejection or a counter-offer by the offeree
b. Lapse of time
c. Revocation by the offeror
d. Death or incapacity of the offeror or offeree
(2) Offeree’s power of acceptance is terminated by the nonoccurrence of any condition of acceptance under terms of offer. |
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