Stephanie Burke

Remedies Outline Professor Sanchez MODERN LAW OF DAMAGES o Damages are legal o Substitutionary relief o Are always awarded in the form of money o Measured by Plaintiffs loss (as opposed to restitution which is measured by Defendants unjust enrichment !"#"$ award damages for unjust enrichment% Overvie &' of !inds of "ort Dama#es$

%om&ensator'( is an amount to make the P whole by compensating him for actual losses where a tort is in)ol)ed or for his lost e*pectancies if the relationship was a consensual one' o +n tort cases, the injury must be the pro*imate cause of the damages and the P is entitled to all compensatory damages pro*imately caused by the tort' +t is an amount which will restore the P to the pre-tort status (backward looking% o +n contract law, compensatory damages is an amount that will put the parties in the position they would ha)e been in had the . been performed' A term that encompasses both general and special (conse/uential% damages, but e*cludes puniti)es' 0he P is entitled to all compensatory damages foreseeable at the time the . was entered into' o General damages( (non-economic% these do not ha)e to be specially pled' 0hey naturally arise from the tort or breach of . includes such elements as pain and suffering, loss of enjoyment of life and lost earning capacity, disability and disfigurement' o Special (consequential) damages( must be specially plead to be reco)erable1 include such damages as loss of earnings (wages% and medical costs' Special damages are synonymous with conse/uential damages or indirect damages (while general damages are direct% 0o be reco)ered, special damages( &' cannot be too remote from the injury 2' there must be a causal relationship (But for% between the injury and the damages 3' they must be pro)en with a reasonable degree of certainty o "ort$ restore P to pre-tort status (backward looking%' P is entitled to all damages pro*imately caused by the tort' o %ontract$ amount to put the parties in the position they would ha)e been in had the . been performed' P is entitled to all damages foreseeable at the time the . was entered into' o Economic 4 measured by pre-tort life e*pectancy

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o Non(economic 4 Post-tort life e*pectancy 2' Nominal dama#es$ 0hese are awarded in certain cases where there is no specific harm and only the establishment of a right is in)ol)ed' 6sually, the P does not seek only nominals, but the court after finding no compensatory damages awards these' A token amount awarded for some torts (trespass to realty and con)ersion% and for some breaches of contract' o 7ertain causes of action re/uire proof of actual damages, so nominals cannot be awarded' 0hus, not awarded for fraud, negligence, or trespass to chattels because injury is part of the prima facie tort (i'e', without the injury, there is no tort%' Punitive Dama#es )e*em&lar'+( are considered non-compensatory damages' Are imposed to punish or deter and are awarded bc the D has acted in a manner which e*ceeds the normal standards of decent conduct between the indi)iduals' o Showing of actual malicious and wanton conduct re/uired i'e', must show that the D acted with malice or reckless disregard' o An award o)er and abo)e compensatory damages' o +n many states, the case for puniti)e damages must be pro)en by clear and con)incing e)idence' o 8ithout compensatory damages, there can be no puniti)e award' !o puniti)es if only nominals are awarded' o Most likely get them for intentional torts (not in ., unless and with the e*ception of bad faith%' o 7an get it under damages or restitution' o "motional Distress Damages( usually awarded in intentional torts, mostly nuisance Li,uidated Dama#es( an amount agreed upon by the parties to a ., contained in the contract and is awarded in lieu of actual damages' Disfa)ored in the law1 if a li/uidated damages clause is struck down as a penalty, the P must pro)e actual damages' o A )alid li/uidated damages clause reflects( o &' 0hat at the time the . was entered into, it was ne*t to impossible to estimate what damages would be in the e)ent of breach1 and o 2' 0he amount agreed upon is the best estimate of what those damages would be and is reasonable o !ot awarded in tort action o :irst look or second look (the amount in the clause must be reasonable at the time of the contract formation and the time of breach% -nterest( usually go)erned by statute' !ot granted on any amount of bodily harm, emotional distress, or for injury to reputation' o Pre(.ud#ment( is measured from the time the claim was due until judgment entered' !eed to be certain as to amount owed for breach of ., not in tort,

3'

9'

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because the sum is more likely known (i'e', the sum is li/uidated<certain in amount% amount owed between date cause arises and date judgment is entered by the court (amount owed must be li/uidated definite and certain% !ot entitled to pre-judgment interest in P+ suits because the amount is not known' Most common in . cases' Discounting decreases plaintiffs reco)ery =' Attorne' Fees( not a)ailable unless pro)ided by statute or .' 0here is no blanket authority for the reco)ery of attorney fees' American $ule pro)ides that each side pays for their attorney fees' "*ceptions( class action suits' Rules affectin# recover' of Dama#es$ a0 Avoida1le conse,uences rule 2 (mitigation of damages steps the injured party can take to reduce or eliminate damages way of reducing Ps reco)ery% says P cannot reco)er any special damages which he could ha)e a)oided by reasonable acts e*penditure' 0he theory behind this rule is that of economic aste and the D has the burden of pro)ing that the P should ha)e minimi>ed' +t applies to both torts and .' 10 %ollateral Source Rule 2 )onl' invo3ed 1' P+ unlike the abo)e, it may work to the detriment of the P, it may work to his benefit pro)ided that the P recei)es benefits from a source collateral (insurance% to the D in either tort or .' D cannot use this source to reduce his liability for damages, unless the collateral source came from the D himself' (to increase Ps reco)ery% c0 Li,uidated dama#es 2 contracting parties can agree on a method for determining damages in the e)ent of a breach of .' 0his is usually done where the damages are )ery difficult to determine and the amount agreed upon is a reasonable forecast of just what the damages will be' 0here are )alid unless the court decides them to be a penalty' Penalty would be where the amount agreed to is unreasonable and grossly disproportionate to the actual losses' d0 Economic Loss Rule 2 absent contract or injury to person or property, P may not reco)er in negligence for economic loss' This is a policy argument; limits liability and based upon the level of culpability (i.e., negligence is a low level of culpability) e0 Pro*imate %ause Limitation in "ort %ases 2 an injured person is entitled to be compensated for all injuries pro*imately caused e)en if those injuries could not ha)e been foreseen by the wrongdoer and e)en though the injury is increased by plaintiffs particular condition' Pro*imate cause relates only to the issue of liability, i'e', it does not act as a limit on damages' f0 %onse,uential Dama#es Limitation 2 0he rule of ?aley )' Ba*endale( the rule limits special damages in breach of . cases to those arising naturally from the breach or within the reasonable contemplation of the parties at the time the . was made'

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WA4S OF MEAS5R-NG DAMAGES$ 60 %ost to re&air (most often associate with torts) 70 Diminution of value (most often associate with torts) this is the difference between the pre-tort and post-tort )alue of the property 60 -f 1oth cost to re&air and diminution of value 1oth 'ield zero then the P is entitled to nominal dama#es 2' @uasi contract 80 Rental value (can be a measure of damages or quasi- ) 90 Lost 1usiness &rofits (often challenged as too speculative (means you lose) unless such damages can be established with reasonable certainty li!e mediation.) :0 %ontract dama#es( aims at putting the parties in the position they would have been in had the been performed. a' out of &oc3et dama#es$ b' 1enefit of the 1ar#ain( diff btw .P and the :M# of Property at the time of the breach (majority rule for breach of .% ;0 Fraud dama#es (often measured in either of two ways) a' Aut of Pocket( difference btw . price and :M# of goods b' Benefit of the Bargain( diff btw :M# and the #alue property would ha)e had the representation been true /0 %onversion dama#es$ (also known as forced sale% are almost always measured by the fair market )alue of the property at the time and place of the con)ersion' 8hen the judgment is paid, title )ests retroacti)ely in the D, court splits o)er whether P is entitled to pre-judgment interest o $estitution and damages are mutually e*clusi)e cannot get both restitution and e"pectation damages o :or rescission, ha)e to show a material breach o :or specific performance, ha)e to show an inade/uate remedy at law (usually uni/ueness land .s% o "he la of ! reco#nizes three interests$ &' Restitution <rescission Ds unjust enrichment' Bou get back what you paid 2' Reliance (out of pocket and conse/uentials% loss from relying on duty of other, not related to the other party 3' E*&ectations (damages or specific performance% #$s loss. %hat did they e"pect from the deal E*istence v0 amount of dama#es( "*istence goes to the 7AA (causation%1 Amount goes to the remedy

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"=E NA"5RE OF LEGAL DAMAGES$ GAVCUS V. POTTS (17) &'() trespass to realty and conversion (stepdaughter came into the house and too! valuable coins). *emedy) +amages. ,o physical in-ury to property proven so no direct damages. Trespass to land is t!e unaut!ori"ed p!#sical entr# into t!e land o$ anot!er actual damages not required. .ndirect and direct need to be proven. ,ominal damages allowed. Con%ersion o$ c!attels && intentional' su(stantial and unreasona(le inter$erence )it! t!e personal propert# o$ anot!er ' Do not ha)e to show actual damages' Ps option is of forced sale or return of property' o 7ommon law rule American $ule with regard to attorneys fees pays their own attorneys fees o +ndirect damages of mental distress not pro)en' o !o puniti)es w<o compensatory damages, i'e', must pro)e actual<compensatory damages to obtain puniti)es' o E*ce&tion to American Rule( Attorney fees reco)erable if prior litigation was between P and a 3rd party and prior litigation was the pro*imate result of Ds wrongful act' o 7ould also reco)er conse/uential damages which are the natural and pro*imate result of the trespass (need proof<e)idence of mental distress by either a physical or mental manifestation% o injunction is always a remedy you associate with a trespass to chattels (injunction pre)ents future harm% o "motional distress is a)ailable as special damages in a trespass to realty case o 0wo traditional measures of tort damages - 7ost to repair and diminution of )alue : Remedies Associated ith %onversion 60 $eple)in legal restitution 70 Damages 80 @uasi contract
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90 7onstructi)e trust :0 "/uitable Cien PROOF OF "=E E>-S"EN%E OF DAMAGES *U+A P,A+-AC.UT/CA0S /nc %. 1+OU*O (23) 7AA( Securities :raud( intentional ) ith ron#ful state of mind+ material misre&resentation in connection < sale of securit'? < reliance' +s claim sufficientD Plaintiff purchased stocks1 D omitted known facts in sale, and P relied' "conomic loss and loss causation sufficient to send to trial' o Damages are a substanti)e element of the 7AA' !o actual damages, no award of damages' Damages go to 7AA' Amount of damages goes to the remedy' Ance you pro)e the e*istence, law makes it easy to decide amount' o 8hene)er unjust enrichment is the 7AA, some sort of restitution will be the remedy o Damages are measured by Ps loss o Prima Facie %ase of Fraud 60 Scienter Affirmati)e lie Acti)e concealment Silence (where there is a duty to speak% 70 A Material misrepresentation of a material fact 80 $easonable $eliance 90 7ausation :0 +njury 4OUST %. 0O5GO (26) - ?orse $ace 7ase' 7AA( -ntentional -nterference ith Pros&ective Economic Advanta#e must pro)e Ereasonable probabilityF but for the Ds conduct' 7Proo$ t!at it is reasona(l# pro(a(le t!at t!e lost economic ad%antage )ould !a%e (een reali"ed (ut $or t!e *s inter$erence.8 Prima :acie 7ase for +ntentional +nterference with Prospecti)e "conomic Ad)antage( 7 Parts to an -n.ur' &' "he e*istence G goes to the 7AA 2' "he amount G this goes to the damages 7ompensatory and puniti)e damages were sought (because sought puniti)e also this is an intentional tort%' Substantial certainty or high probability of success' 7ausation was the issue in this case as opposed to the amount of the remedy'

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o Plaintiff has the burden of proof by preponderance of the e)idence standard1 this is the most often cause of ps losing' o 7ourts are stricter in what is re/uired to pro)e 7AA1 but more lenient where it comes to the amount of damages' 0hus, there must be proof sufficient to establish a probability of loss although it is usually not necessary to pro)e the amount of damages with mathematical certainly' 0he certainty re/uirement is most often contro)ersial in loss of profits cases' A claim for future damages re/uires proof that there is a better than ;H;H change that such damages will occur' Levels of %ul&a1ilit' &' +ntentional 2' $eckless, willful and wanton 3' Iross !egligence 9' !egligence ;' Strict Ciability ,.5+4 %. *O9 C,.-/CA0 CO-PA54 (:3) 7lient negligently released Dio*in, can result in horrible illness, death' P is class that li)es J works there' 7an take years after e*posure to show illness' !o member of the class is presently ill' +s fear of future illness itself an illnessD ?a)e to ha)e a physical illness for case to proceed' 7AA( personal injury (negligence% (needed to pro)e Emore likely than not you will get illness% Ne#li#ence can occur in 8 a's @ ne#li#ence resultin# in in.ur' to$ 60 Peo&le a' Personal injury b' 8rongful death c' Sur)i)al actions - 0he only remedy is some form of damages 70 Personal &ro&ert' 80 Real Pro&ert' Prima :acie 7ase for !egligence G Duty, breach, causation, injury (damages% $"M"DB( Damages, Medical monitoring (e/uitable remedy like an injunction which is to pre)ent future harm, medical monitoring is also in place to pre)ent future harm% +SS6"( o +njuries are in prima facie case (negligence% no nominal, no puniti)e

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o 0he injury was too speculati)e, therefore no reco)ery' Must be able to show that risk is more probable that not (K;HL%' !o nominals in negligence w<o actual injury' o Ance a Dr determines that a member of the class is in early stages of the illness, its e/uitable because it pre)ents further injury then remedy is medical monitoring o "ort dama#es are (ac;)ard loo;ing they put the plaintiff in the position they were in before the tort occurred o %ontract dama#es are forward loo!ing to put the parties in the position that they would ha)e been in had the contract been performed o Dissent( +njury is emotional distress' Policy reason for imposing limitations on Dows liability( le)el of culpability PROA-NG "=E AMO5N" OF DAMAGES LOS" B5S-NESS PROF-"S( proof re/uired for these damages AT</5 9+/G,T( 0elephone number problem 7AA( negligent interference with prospecti)e business relationships1 remedy sought was general and puniti)e damages' P did not pro)e lost income was caused by Ds intercept' ?ere, it was all too speculati)e, there was no proof of 3 months of lost net income o !egligence is a sort of midle)el culpability o Must pro)e injury o !ominal damages not a)ailable $e/uirement of 7ertainty( means that in order to reco)er damages, there must be sufficient proof to show that P actually suffered some damages' 6ncertainty of Amount( is not fatal' 7ourts ha)e held where the fact of damage is certain, the e*act amount therefore need not be' LOS" %APA%-"4 "O EARN ' 9AS,/5GTO5 %. A-.+/CA5 CO--U5/T4 (=>)( 7AA( personal injury (negligence stemming from a car crash%1 liability is not an issue' $emedy( damages (di)ided into special and general%( economic( lost earning capacity is special as is medical bills while pain and suffering and loss of enjoyment of life fall under general' 8as a wrestler with an outstanding record' 0here was sufficient e)idence to award lost earning capacity'

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GENERAL DAMAGES )non(economic+ Loss of earnin# ca&acit' is distinct from loss of wages, salary or earnings, is a separate element of general damages' +mpairment of earning capacity is an item of general damages and proof may be had under general allegations of injury and damage' Proof of an actual loss of earnings or wages is not essential to reco)ery for loss of earning capacity' $eco)ery for loss or diminution of the power to earn in the future is based upon such factors as the plaintiffs age, life e*pectancy, health, habits, occupation, talents, skill, e*perience, training, and industry' What if the forced circumstances result in #reater future earnin#s? does it cancel out recover'C SPE%-AL DAMAGES )economic+ 2 0hey must be specifically plead 60 Medical Bills 2' Loss of &ast earnin#s is an item of special damages and must be specifically plead and pro)ed' o Cost earnings refers to actual track record of work o Special must be plead specifically o Ieneral do not ha)e to be plead o 8hat facts gi)e rise to a lost earning capacity in a hypo( students for instance 7an you reco)er for loss of earnings and lost earning capacityD o you may be able to reco)er under both General Dama#es Pain and suffering Cost earning capacity Coss of enjoyment of life S&ecial Dama#es Medical bills Cost earnings

C,/0*S %. U.S. 7AA( wrongful death under the :ederal 0ort 7laims Act and Ieorgias 8rongful death statute' $emedy( damages (funeral and medical e*penses are not at issue% o economic )alue on the loss associated with decedents deaths based upon their lost future income, fringe benefits and household ser)ices1 these amounts must be discounted because can be in)ested' 7ourt held that it may consider the economic losses as well as any non-economic intangible losses' 8 %auses of Action &' Personal injury 2' 8rongful death (by statute% o the plaintiffs in a wrongful death claim are the dependents of the decedent 3' Sur)i)al action (by statute% o the plaintiff is the estate of the decedent and will reco)er whate)er the decedent would ha)e reco)ered had he or she not died Dama#es Availa1le in a Wron#ful Death %ase &' Support lost earnings 2' Ser)ices care of the home( cooking, other household chores
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companionship

+n )aluing the decedents lost future income, all e*perts used the following four elements in making their calculations( )6+ Base('ear or entr' level income the decedents initial actual or projected before-ta* income )7+ -ncome #ro th rate the income growth rate reflects the fact that the baseyear income will grow o)er time as a result of inflation, producti)ity gains and progression in ones career )8+ Wor3 life e*&ectanc' the probable length of time a person would ha)e remained in the workforce, taking into account periods of )oluntary and in)oluntary employment )9+ Discount rate because income earned in the future is less )aluable than income earned today, the discount rate is used to calculate the present )alue of a decedents future income loss' +n addition to these elements, the doctors appraisals included two other elements( personal ta* offset and personal e*pense<consumption offset' 0hese elements simply reflect the fact that some portion of the decedents income would be lost to the decedents personal consumption and to income ta*es' Discountin#$ :uture economic damages are discounted to present )alue (not noneconomic% (past damages because they ha)e already accrued are not subject to discounting% (typically, discount rate is =L%' Some courts e*ercise total offset rule interest rate cancels out inflation' District 7ourt retains discretion' NON(E%ONOM-% LOSS$ an injured party may reco)er for past, present, J future noneconomic losses' 0hese losses are generally referred to as general damages, whereas economic losses are referred to as special damages' Ph'sical Pain$ P is entitled to reco)er for pain and discomfort caused by injury' !o guidelines' 0he jury must merely determine what is ade/uate compensation' Loss of En.o'ment of Life$ Many cases say it is not a separate claim from pain and suffering' Modern trend is to allow this as a separate element of damages in addition to whate)er other pain and suffering is pro)en' -m&ortant$ loss of enjoyment of life is not a separate item of damages from pain and suffering1 it is one element for calculating pain and suffering for e"am PA/5 A5* SU??.+/5G What is included in &ain and sufferin#C )com&onents+ )6+ the )ictims anguish and terror felt in the face of impending injury and death )7+ the )ictims tangible physiological pain at the time of injury and during recuperation

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)8+ the )ictims enduring loss of enjoyment of life as one who is denied the pleasures of normal personal and social acti)ities because of his permanent physical impairment )9+ the AC+ report also classifies as pain and suffering what others call the deri)ati)e damages category of consortium, Ethe immediate emotional distress and longterm loss of lo)e and companionship resulting from the injury or death of a close family memberF 0OT, 7AA negligence (personal injury action% $emedy( damages (general, PJS% o +ssue +s loss of enjoyment of life to be considered a factor in calculating PJS or is itself a separate element of reco)eryD +t is merely one factor that can be taken into consideration in calculating pain and suffering' Ane of the main reasons behind this is to prohibit double reco)ery' Iolden $ule Argument (inadmissible% would you like to be compensatedD Per Diem Argument if you had the plaintiffs injuries how much

-c*OUGA0*( 7AA( negligence (personal injury action% o $emedy( damages' -non-economic<non-pecuniary<general damages - Ps awareness is rele)ant in calculating damages for loss of enjoyment of life Plaintiff was in a persistent )egetati)e state' "*perts differed as to whether she was aware of her pain and suffering - !on-pecuniary damages should be considered together' o %o#nitive a areness is a prere/uisite to reco)ery for reco)ery for loss of enjoyment of life (e/ually with pain and suffering - if you cant feel it, you cant reco)er for it% o !eed some le)el of awareness to reco)er for pain and suffering if you cannot feel pain then you cannot reco)er o 0he majority says that loss of enjoyment of life is reco)erable as an element for pain and suffering "=E D-AERGEN%E BE"WEEN "OR" AND %ON"RA%" -N L-M-"-NG DAMAGES Foreseea1ilit' limits contract dama#es1 foreseeability is measured when . is formed (/adley v. 0a"endale) Pro*imate cause limits tort dama#es

.V+A( 7AA( negligence1 $emedy( damages 0his case deals with conse/uential damages (special, indirect, etc'% 0he rule of ?adley is that conse/uential damages will not be awarded unless the D was pit on notice of the special circumstances' 0his case is not the majority rule bc Posner

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is trying to use EforeseeabilityF in a tort case (as opposed to pro*imate cause% to limit<deny damages Posner puts the burden on the party who is in the best position to limit liability (i'e', a)oidable conse/uences% (like saying the P was contributory negligent% o 7ontract liability is strict Doctrine of Avoida1le conse,uences$ cannot reco)er damages for things he was in the best position to know and to limit the loss1 reasonable steps injured party can take to lower<limit damages (e'g', that party can insure against the loss, can inform the other party of the importance, etc'% W=ERE DO "OR" DAMAGES END 2 E%ONOM-% LOSS R5LE ST.+5 @ -AAO+/T4 +U0. 7AA( negligence J strict liability1 $emedy( damages1 ?ere, Ps lost because the court in)oked the economic loss rule Ps were employed at a hotel that burned down' 0hey brought class action against those in)ol)ed in the design and construction of the hotel to reco)er lost salary and employment benefits for the period Ps were unemployed due to the fire' 7t held that a defendant will not be liable for economic conse/uences of an unintentional negligent act' Economic Loss Rule( absent contract or injury to person or property, P may not reco)er in negligence for economic loss' This is a policy argument; limits liability and based upon the level of culpability (i.e., negligence is a low level of culpability) "conomic losses are reco)erable in negligence and in intentional torts

ABA/+. CO+P @ -/5O+/T4 +U0. 7AA( !egligence -- interference with prospecti)e economic ad)antage' $emedy( damages (economic losses% ?ere, clearly foreseeable that delay in construction would injure Ps business R5LE$ Ps interest in prospecti)e economic ad)antage may be protected against injury occasioned by negligent as well as intentional conduct (minority rule% "hus? economic losses may be reco)erable in some situations where the harm is foreseeable by a reasonable defendant +A+*/5 - 7AA( tortious conduct in contractual setting1 7ase for lost profits' 7ourt didnt allow saying that the buyer, here, could ha)e protected himself1 that the machine repair people did not ha)e a duty to the buyer (there was no pri)ity of .%, and there was no foreseeability' 1+/G,T& %OA$ ne#li#ence 2 &ersonal in.ur' $emedy( damages

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0his case raises a)oidable conse/uences doctrine R5LE$ no reco)ery for damages that could ha)e been a)oided by using means which a reasonably prudent person would ha)e used to cure the injury Doctrine of Avoida1le %onse,uences$ Duty that is imposed upon the injured party to take reasonable steps to limit their injuries, i'e', a duty to mitigate' o +f successfully in)oked then it decreases the amount of reco)ery E##shell S3ull Doctrine take your plaintiff as you find him (doesnt apply to religion% the scope is only to physical injuries Majority rule is to use the reasonable person test (not the reasonable Oeho)ahs witness% o 0he court may ask about the sincerity of your religious beliefs %ollateral Source Rule$ (i'e', separate from the D% States if an injured party recei)es some compensation for his injuries from a source wholly independent of the tortfeasor, such payment should not be deducted from the damages which the plaintiff would otherwise collect from the tortfeasor o if successfully in)oked then it increases the plaintiffs reco)ery %ollateral Source Rule )$or eCam)$ Aids the plaintiff +f successfully in)oked, it doesnt reduce Ds liability (and may result in double reco)ery% (but, it is not really double reco)ery because the P must pay his attorney and be subject to subrogation clause, where insurance gets reimbursed from what you collect in damages% Medical Malpractice 7laims can be brought in 2 7AAs (&% !egligence (2% Breach of 7ontract P5N-"-AE DAMAGES ( 0hese are damages abo)e and beyond compensatory ones' 0hey are non-compensatory damages intended to deter or punish must pro)e by clear and con)incing e)idence that D acted with e*press or implied malice' %ontract %ases$ Puniti)e damages are not awarded in breach of . cases, no matter how willful the conduct, unless an independent tort is also present Standards for &unitive dama#es Malice defined as ill-will (implied 4 outrageous% Both e*&ress and im&lied constitute actual malice "4PES OF MAL-%E 60 .Cpress$ ill will

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70 80

/mplied$ where deliberate conduct by D, although moti)ated by something other than ill will, is so outrageous that malice toward a person injured as a result of the conduct can be implied Actual$ o Puniti)e damages are ta*able o Punishment is for past acts o Deter is for future acts

%an 'ou insure a#ainst &unitive dama#esC Majority rule is that you cannot Ar#uments for<a#ainst &unitive dama#es$ P$A( deter beha)ior, no double jeopardy, 7A!( criminal law punishes, not tort law, double punishment, windfall to P, in)ites abuse, no objecti)e standard' TUTT0.( P was seriously injured when Ds )ehicle struck hers after running a red light at an e*cessi)e rate of speed' 0he ct held that it will recogni>e puniti)e damages' 0he doctrine sur)i)es b<c it continues to ser)e the useful purpose of e*pressing societys disappro)al of intolerable conduct' Mere negligence is not enough, must show wanton, malicious, reckless, or grossly negligent conduct' 0he court used two different standards of proof clear and con)incing )' preponderance' 8hat le)el of culpability is sufficient to award puniti)e damagesD 0his court says that the plaintiff must show actual malice by clear and con)incing e)idence' &' 2' 3' 9' ;' =' 5' Malice +ntent 8anton<8illful $eckless Iross !egligence !egligence Strict Ciability

1-9( fraud in the inducement' Ane of 3 torts for which you need to pro)e injury to pro)e tort' 0his rules out nominal damages' BM8 failed to disclose to consumer of new car that it had been damaged and repainted before being sold' 7t held that puniti)e damages may be properly imposed to further a states legitimate interest in punishing unlawful conduct and deterring its repetition' S70 also held that only when an award is grossly e*cessi)e is it arbitrary and in )iolation of the due process clause'

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FRA5D -N "=E -ND5%EMEN" OF A %ON"RA%" re/uires 60 Scienter means knowledge of falsity (knowledge that what you are saying is false% (either non-disclosure (which can be acti)e or passi)e% or affirmati)e misstatement% 70 Material misre&resentation of a material fact 80 Reasona1le reliance 90 -n.ur' (re/uires injury to pro)e the tort and therefore nominal damages are not a)ailable% What Standard does the %ourt set for determinin# hen an a ard of dama#es violates due &rocessC :actors to determine whether an award of damages )iolates due process 60 $eprehensibility of the injury 70 $atio of &H to & means puniti)e to compensatory (if puniti)e damages are less than &H times the compensatory it is a rebuttable presumption that the amount is constitutional% 80 7ompare the puniti)e damages to the comparable ci)il penalties o 8hat is the standard courts use to determine whether to o)errule a jury award for puniti)e damagesD whether it shocks the conscience of the court passion, prejudice, partiality o %om&are the civil &enalties ith the criminal &enalties as a way to determine whether they are e*cessi)e What is the difference 1et een tuttle and 1m C 0uttle is the common law limitations on puniti)e damages and this BM8 represents constitutional limitations on puniti)e damages -AT,/AS $ecklessness<willfulness<wanton Iross negligence o %om&are the com&ensator' dama#es to the &unitive dama#es to determine hether the' are e*cessive 2 if the' are #reater than 6D to 6 then the' are considered &resum&tivel' violative of due &rocess

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A""ORNE4 FEES 5/0S.5 %. 4or; Co. American Rule$ "ach party bears its own attorney fees E*ce&tions are$ 60 Statutor' fee shiftin# left to courts discretion and super)ision, most commonly found in ci)il rights statutes 70 Eudicial doctrines common law ct decides attorneys fees (typically the higher the fees, the lower L% a' Bad faith litigation b' 7ommon fund doctrine left to courts discretion and super)ision' A reasonable fee based upon a percentage of the fund bestowed upon the class' &' Percenta#e of the Fund$ (Majority Approach% -- reasonable percentage standard (under statutes% reflects the amount of attorney time reasonably e*pended on the litigation' 7ourts ha)e used between &NL - 9;L' 2' Lodestar method$ hours worked * reasonably hourly rate and court adjusts that figure to reflect the contingent nature of the litigation 80 %ontracts hich sti&ulate for fees to non(1reachin# &art'

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"OR" REFORM 1.ST %. TA40O+( Cegislature wanted to limit non-economic damages (pain and suffering<lost earning capacity, etc'%' 0his is a form of FLe#islative remittiturG and it encroaches on the judiciary because it is a judicial duty to cap or reduce e*cessi)e )erdicts' that the court said the law is arbitrary is e)idence that the court is using rational basis analysis -N"ROD5%"-ON "O EH5-"ABLE REMED-ES As opposed to the legal remedy of damages, e/uitable remedies are( 60 Specific and direct orders to D to perform or to remedy the harm 70 Pre)enti)e 80 Discretionary 90 :le*ible and fair because they are adapted to the particular case1 and :0 "nforced by coerci)e measures directed against the person, rather than by judgment agent the persons property ;0 !o jury when court issues e/uity 8 t'&es of -n.unctions 60 "em&orar' Restrainin# Order this one can be issued e* parte meaning that it can be issued with only one part present in court o in most states the 0$A e*pires in ; days 70 Preliminar' -n.unction (unless he says otherwise discuss the re/uirements for a preliminary injunction% a( Plaintiff must pro)e by preponderance of the e)idence the likelihood of success on the merits 1( A showing of irreparable harm meaning that the legal remedy of damages is inade/uate c( 0he balancing of the hardships d( +ssuance of the injunction will not disturb the public interest 80 Permanent -n.unction E,uita1le Remedies (just a few% 60 $eformation 70 +njunction 80 Specific performance 90 $escission "ort Remedies( injunctions Restitution<5n.ust Enrichment( 7onstructi)e trust, e/uitable lien, subrogation %ontract Remedies$ specific performance, rescission (/uasi-contract%, reformation

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Subject Matter Ourisdiction - local action rule - 0he Power

Ourisdiction )' "/uity Ourisdiction - 0he propriety Personal Ourisdiction

inade/uate legal remedy

An injunction issued by a court that lacked jurisdiction is )oid' 0he Cocal Action $ule G A court in state A lacks subject matter jurisdiction to determine issues of title or trespass to real property located in another state (state B% ' E,uita1le Eurisdiction( distinguished from power' ")en if the court has e/uity power, the court must ha)e primary jurisdiction o)er the subject matter and the parties or res' :urthermore, to grant e/uitable relief, the court must find that the legal remedies are inade/uate and generally, that the e/uitable remedy sought is the effecti)e and enforceable' E,uita1le Eurisdiction o no ade/uate remedy at law (if you can show irreparable harm then you ha)e pro)ed that there is no ade/uate remedy at law% o no jurisdiction to enjoin a criminal prosecution (see below% o Most important use is to protect ci)il liberties %onditions of E,uita1le Relief$ 0here must be no ade/uate legal remedy and certain other conditions must be satisfied' -nade,uate Remed' at La $ Some e*amples of cases where courts found an inade/uate remedy at law are when D threatened with multiple prosecutions under a clearly unconstitutional statute, insol)ency of the defendant, if the item is uni/ue, are ways of showing that there is no ade/uate remedy at law' "ort %ases$ Before an injunction, a court will balance the e/uities and consider the feasibility of enforcement of the injunction' -NE5N%"-ONS -n Rem 4 o)er the subject matter -n Personam 4 court has jurisdiction o)er the parties Caw acts in rem "/uity acts in personam o +f D does not do what e/uity re/uires, then it can be enforced by contempt

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-m&ortant$ "/uity courts issue decrees )' Caw courts issue judgments important because the ::7 only applies to judgments

this is

Local Action Rule$ deals with real property and says a court in state A cannot award damages with regard to a trespass or a title issue regarding land in state B (if a court does, then its judgment is )oid% )' transitor' TA1O+ @ Decree prohibiting foreign lawsuits( 0wo cases in two different states o)er the same subject matter' 8hen may a court in one state enjoin a foreign court proceedingD $ule( rarely and only if the foreign proceeding will be likely to result in fraud or oppression' E .t is only where it clearly appears that the prosecution of an action in a foreign state will result in a $raud' gross )rong or oppression, that a court of equity will interfere with the general right of a party to press his action in any -urisdiction in which he may see fit and in as many of them as he chooses and restrain him from the prosecution of such a suit.1 Note the difference 1et een ?ull $ait! and Credit and Comit# :ull faith and 7redit the law demands that state B enforce the action of State A 7omity state A will issue an injunction that has force and effect in state B' State B can but does not ha)e to enforce the injunction' +t will enforce the injunction of State A if it wants State A to enforce injunctions from state B' -ATA+.S. @ $oreign real estate 0he case in)ol)ed land located in +taly' And the issue is whether the court could enjoin and enforce a decree where land is located in another stateD 8hen the subject matter of a suit in a court of e/uity is within another state or country, but the parties within the jurisdiction of the court, the suit may be maintained and remedies granted which may directly affect and operate upon the person and not upon the subject matter, although the subject matter is referred to in the decree, and the D is ordered to do or refrain from certain acts toward it, and it is thus ultimately but indirectly affected by the relief granted' 0his case in)ol)ed constructi)e trust as a remedy' -c5U0T4 @ $oreign (an; accounts 0his case is about a courts contempt powers because the court ordered the D to return funds to the 6'S' and when D didnt (i'e', when he )iolated the injunction%, the court put him in prison' +njunctions are dependent upon a courts power to enforce them' +njunctions cannot reach out to another country, etc' EH5-"4 LA%!S E5R-SD-%"-ON "O ENEO-N A %R-M-NAL PROSE%5"-ON Prosecution under a )alid statute is generally not enjoinable' Prosecutions under unconstitutional or inapplicable statutes may be enjoined if irreparable injury may result'

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5O+C/SA( As a general rule, criminal prosecutions are not to be enjoined with the e*ception of restraining prosecutions under unconstitutional or )oid statutes or local ordinances' I"!"$AC $6C" G "/uity cannot /uash a criminal case A court ill enter an in.unction to en.oin a criminal &roceedin# hen$ &' A substantial right will be materially impaired (irreparable harm% 2' $emedy at law is inade/uate (unconstitutional or )oid statutes% 3' +njuncti)e relief can be applied w< practical success J w<o impossible burden on the court ACU5A @ equit# lac;s Durisdiction to enDoin a crime 7ase is a pubic nuisance case brought by the city for an injunction'

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N5-SAN%E Nuisance < P Pri)ate P 4 indi)idual

Public p 4 state or indi)idual

Per se )' in fact remedies Damages +njunction Nuisance substantial unreasonable intentional interference with the use and enjoyment of Ps real property' Private nuisances( doesnt ha)e to affect e)eryone Pu1lic Nuisances( does ha)e to affect e)eryone1 city has standing1 +njurious to health, offensi)e to the senses Nuisance &er se( imminent threat to health, safety welfare of the community1 to e)eryone easier to get an in-unction if you can prove this if a nuisance per se, court must issue the in-unction Nuisance in fact not always a nuisance and therefore there will be a 1alancin# of hardshi&s

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R-G=" "O A E5R4 "R-AL ( "est under the /th Amendment &' Cook at the 7AA and the remedy (they can be either legal or e/uitable% 2' +f both legal, the ha)e a right to jury 3' +f both e/uitable, then no right to jury trial 9' +f it is a case of mi*ed law and e/uity( refer to coa and look back in time to when the amendment was adopted to see if an analogue e*isted' +f not Q R-G=" "O E5R4 "R-AL 2 /th amendment onl' a&&lica1le in Federal %ourt 2 ho ever ith res&ect to State %ourts$ -Majority follows federal rule -Minority-e/uitable cleanup doctrine ?eltner %. 9ood( "ES" ON R-G=" "O E5R4 "R-AL$ $ight to O0( first look at statute, if no right stated go to 5th A( look at cause of action and the remedy, if both are e/uitable then no O0, if both are legal then yes' 8hen 7t does not know, looks to common law analogues i'e', back in &5NH when the 5 th amendment became law, was this 7AA e/uitable or legal' 0"S0( Cook at both the cause of action and the remedy entitled to a jury trial if both are legal then that R is

Note$ Damages and injunction are only a)ailable together if damages compensate for past harm, not future' "=REE "4PES OF -NE5N%"-AE REL-EF 60 "em&orar' Restrainin# Order (0$A%( to preser)e the status /uo' Short duration, usually &H days' 7an be granted e*-parte, but not always' !eed reasonable attempt to gi)e notice to D' 70 Preliminar' -n.unction$ if granted can last from one month to a year' Four Re,uirements for Preliminar' -n.unction &% A substantial likelihood of success on the merits1 2% A substantial threat of irreparable harm1 (legal remedy usually damages - is inade/uate% 3% Balancing of the hardships (if the ct issues the injunction will it do the P more good than it will harm the D (preponderance of the e)idence%1 9% +njunction will not disser)e public interest SStandard( Preponderance of ")idence 80 Permanent -n.unction$ Factors$ )-PFBD+ &' Are the legal remedies -nade/uateD Cand, irreparable harm (cutting tree down, u want shade1 if repeats dont want to ha)e to sue o)er and o)er again'

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2' +s there a &roperty right in)ol)edD Ald common law, not used today' +njunctions are used to protect property rights' 3' +s the injuncti)e decree feasibleD Cook to see if negati)e injunction or affirmati)e injunction1 how much super)ision is re/uired' !egati)e more feasible' Affirmati)e is harder because you must decide what D has to do and re/uires super)ision' 9' Balance the hardships in encroachments and nuisance cases ;' Any defenses (see below) DEFENSES AGA-NS" -NE5N%"-ON$ 60 Laches has the Ps inaction allowed the D to act to his detriment' Caches is an unreasonable delay in bringing an e/uity action, during which time the D has changed his situation to the e*tent that an additional and unnecessary detriment would result if suit were allowed' ")en if there is a SAC, laches may bar suit before the e*piration' Caches does not bar a legal claim' 70 5nclean hands that the P must ha)e acted honorably with respect to this transaction' 0he unclean hands defense is usually confined to Ps ine/uitable (unethical or immoral% conduct directly related to the subject of the litigation' 6nrelated ine/uitable conduct does not bar suit unless such conduct constituties a public fraud' 6nclean hands does not bar reco)ery at law, and application is discretionary' 80 Freedom of s&eech for certain kinds of injunctions the &st Amendment prohibits prior restrain and pre)ents injunctions sometimes' 7ant pre)ent printing a defamation in newspaper, but can sue them afterwards' 90 %riminal act en/uity will not enjoin a crime' "*ceptions public and pri)ate nuisance +njunctions pre)ent future harm (damages are for past, present and future% 0ypically, +njunctions are associated with torts1 specific performance with . cases

"RO v0 Preliminar' -n.unction what the differenceD 0$A is most immediate, decided with )ery little e)idence, early on, and temporary, can be e*-parte' :ollowing the 0$A, must proceed for a preliminary injunction otherwise the 0$A will dissol)e' PROM-SSOR4 ES"OPPEL &' $epresentation (promise% 2' $easonable reliance 3' +njury will result unless one party is bound by their original representation Promissor' Esto&&el$ is a doctrine which if successful is a substitute for consideration to make a promise binding E,uita1le %leanu& )Su1stituted le#al relief+ (2iebarth v. alen3e) Su1stituted Le#al Relief 4 E,uita1le %leanu& Doctrine a court of e/uity, if it had original jurisdiction when suit is filed, then it may also award a legal remedy (i'e', damages% in lieu of e/uity w<o a jury trial'

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Iist of minority position is that legal relief should be granted where e/uity jurisdiction fails' But, +n order for the doctrine to be applied in a particular case, howe)er, P must first establish his right to e/uitable relief, to which damages might then be incidental or subsidiary' o A court of e/uity that has O when suit is filed, may award damages in lieu of e/uity w<o a jury trial A le#al remed' should 1e #ranted here e,uit' fails0 o Minority opinion - +t is a way of limiting or reducing the option of a O0' o Majority - 0rend is to enlarge the right to jury trial' "=E MODERN -NE5N%"-ON$ D-S%RE"-ON AND FLE>-B-L-"4 "=E %=AN%ELLORIS D-S%RE"-ON !a)ajo Academy E"/uitable remedies are distinguished by their fle*ibility, their unlimited )ariety, their adaptability to circumstances, and the natural rules which go)ern their use' 0here is in fact no limit to their )ariety and application1 the court of e/uity has the power of de)ising its remedy and shaping it so as to fit the changing circumstances of e)ery case and the comple* relations of the partiesF 7AA( :orcible "ntry J Detainer 4 ")iction (for renters i'e', landlord tenant relationships%(statutory cause of action (li!e wrongful death 4 survival actions i.e., not !nown at common law) o Statutory o constructi)e long-term lease "EMPORAR4 A0 PERMANEN" =ARM PREL-M-NAR4 -NE5N%"-ON 8hen may a court order issue an injunction ordering a party to specifically perform a .D Breach of ! S&ecific Performance 9 Re,uirements for hen SP in a Bo! is a&&ro&riate$ 60 ! is valid 70 P has su1stantiall' &erformed under the ! and is illin# and a1le to &erform its remainin# o1li#ations (mutuality of remedies) 80 D is a1le to &erform its o1li#ations 90 P has no ade,uate remed' at la CAS0S 6!0+C ?"A$+!I A! 0?" M"$+0S then dissol)ed or made permanent

Em&lo'ment ! cannot be SP 2 &3th Amend' o 7annot force someone to work for someone o Same as sla)ery +ndentured Ser)itude

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EH5-"ABLE DEFENSES (( "WO MA>-MS OF EH5-"4$ %LEAN =ANDS AND LA%=ES %LEAN =ANDS (Ireen )' ?iggins% 0he clean hands doctrine in substance pro)ides that no person can obtain affirmati)e relief in e/uity with respect to a transaction in which he has himself been guilty of ine/uitable conduct' "o ma3e out a claim for unclean hands? must sho that the conduct as 60 Willful conduct hich is fraudulent? ille#al? or unconsciona1leJ and 70 "he o1.ectiona1le misconduct must 1ear an immediate relation )as o&&osed to a collateral matter+to the su1.ect matter of the suit and in some measure affect the e,uita1le relations su1sistin# 1et een the &arties to the liti#ation and arisin# out of the transaction o 7onduct which the court regards as ine/uitable' o !ot a binding rule, but is to be applied in the sound discretion of the court' o Willful conduct hich is fraudulent? ille#al or unconsciona1le renders hands unclean in court of e/uity' o 0he misconduct must be $"CA0"D misconduct rather than 7ACCA0"$AC misconduct arising outside the specific transaction which is the subject matter of the litigation' o 0he doctrine has a shapeless, amorphous, and open ended /uality which leads courts to state the following principles of confinement( o Misconduct cited as unclean hands must ha)e been related to the dispute plaintiff sues on or the relief the plaintiff seeks' o 6nclean hands is discretionary with the trial judge' o 7ourt on its own motion can assert unclean hands o Public policy may o)erride the unclean hands defense' o D may raise unclean hands when P seeks an injunction, specific performance, a constructi)e trust, or any other e/uitable remedy substanti)e areas and types of claims where unclean hands comes up include )iolation of a constitutional right, co)enant not to compete, /uiet title, cancellation, partition, and copyright or trademark infringement' o 6nclean hands only bars e/uitable relief (not legal remedies% LA%=ES (5tone v. %illiams (5tone .)) Laches is an e,uit' defense0 "o invo3e it 'ou need a( 6nreasonable delay 1( Prejudice to Defendant o +n contrast to SAC that pro)ides a time bar within which suit must be instituted,

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o "est$ Caches is an e/uitable defense which asks whether the plaintiff in asserting her rights was guilt# o$ unreasona(le dela# t!at preDudiced de$endants ' o 5nreasona1le dela' fact based analysis o Pre.udice ( Decreased ability of defendants to )indicate themsel)es that results from the death of witnesses or on account of fading memories or stale e)idence' Another type operates on the principle that it would be ine/uitable in light of some change in Ds position to permit Ps claim to be enforced' o More fle*ible than SAC and re/uires an assessment of the facts of each case' +t is the reasonableness of the delay rather than the number of years that elapse which is the focus of in/uiry' o E8here P has not slept on her rights, but has been pre)ented from asserting them based, for e*ample on justified ignorance of the facts constituting a coa, personal disability, or bc of ongoing settlement negotiations, the delay is reasonable and the e/uitable defense of laches will not bar an actionF o :$A6D 0$6MP CA7?"S i'e', if you were defrauded to not bring a claim Aarious t'&es of remedies? claims and issues tri##er laches defenses$ &' Breach of trust 2' 7onstructi)e trust 3' "/uitable lien 9' 0racing ;' "/uitable redemption from mortgage foreclosure =' Ad)erse possession 5' Action to /uiet title M' $eformation of a deed N' A restricti)e co)enant &H' An option to repurchase real property &&' Specific Performance &2' Public employee contracts &3' 7laims that a contract is illusory and )oid &9' 6nconscionable or lacking mutuality

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ENFOR%EMEN" AND EFFE%" OF EH5-"ABLE DE%REES$ %ON"EMP" Due process re/uires that e/uity decrees be sufficiently specific so as to ade/uately inform the enjoined party of the re/uirements of the order' ?ow does a court of e/uity enforce its decreesD 8<o injunction cannot hold a party in contempt 7A!0"MP0 %-A-L %om&ensator' %oercive :ines (fines go to :ines and<or jail Plaintiff not to the time (these court or the state% sanctions are indeterminate in length or amount% - 0hese are also forward looking - At some point if the court is con)inced that the defendant will ne)er comply then it turns into criminal contempt - Proof must be clear and con)incing e)idence that the defendant )iolated the injunction %R-M-NAL :ines and<or jail (they are fi*ed in amount and duration% proof is beyond a reasonable doubt

%ivil %ontem&t +t is the )iolation of a decree ordering D to take action (affirmati)e decree% or prohibiting D from committing certain acts (negati)e decree% and may result in ci)il contempt' 7onfining D until he complies with the terms of the decree' Bou may not be imprisoned for nonpayment of debts' &' 7ompensatory<remedial (money damages for past acts of disobedience% 2' 7oerci)e -- T or prison -- jail per day or fi*ed in time' + holds the !eys to the -ail cell. 6oo!s to the future; indeterminate period of time. 7ay levy fine of specified amount for past refusal conditioned on +$s continued failure to obey and8or fined a certain amount for each day of non-compliance.

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%riminal A )iolation of a negati)e decree may also result in criminal contempt designed to punish D for )iolating the court order )indicate the authority of the court' Punishment for past acts' Absolute fine of specific amount paid to the 6S' +f fine is more than T;HH or jail time more than = months, then entitled to jury trial' Punishment for criminal contempt must comply with general re/uirements for criminal proceedings (right to counsel, burden of proof, jury trial, ; th amendment, cross-e*amination, etc'% jail, fines1 fi*ed past disobedience (Defenses that D can raise( court lacked subject matter jurisdiction ()oidable injunction must be obeyed and argued on appeal Aoid and Erroneous orders$ )iolation of erroneous but jurisdictionally )alid orders may result in criminal contempt' ?owe)er, where an order is )oid due to lack of subject matter jurisdiction, it cannot generally be enforced by ci)il or criminal contempt (voida1le is where the court lacked e/uitable jurisdiction% Persons Bound( only parties and their pri)ies with knowledge of the court decree are bound' !onparties acting independently are free to ignore the injunction %ivil into %riminal when does jail time pass from coerci)e to puniti)eD 8hen you know that D is not going to comply' 0he criminal contempt then kicks in and needs a determinate term' Standards for %ontem&t( criminal is cce1 ci)il is pe "o hold a &erson in civil contem&t need$ &' A clear and unambiguous order ()alid court order% 2' 7lear and con)incing proof of non-compliance (knowledge of order% 3' Party hasnt reasonably attempted to comply in reasonable manner (non-compliance with order% Penalties for violatin# a contem&t &roceedin# ( :ine, jail term, or both "o tell hat t'&e of %ivil contem&t -- +f fines go to P, then that is e)idence that it is compensatory, fines fi*ed in amount, no jail' +f the fines go to state, that is e)idence that it is criminal' 0rend is to focus on remedy1 just bc money is awarded doesnt mean that the remedy is legal1 err on side of a jury trial Direct contem&t$ recalcitrant or unseemly conduct that occurs in the courtroom' -ndirect contem&t( consists of defendants disobedience of injunctions outside the courtroom' %riminal contem&t( to punish and deter' (past acts of disobedience% 60 :ines( determinate 70 Oail( determinate 80 Procedural protections

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Oury trial Beyond reasonable doubt $ight to counsel

%ivil %ontem&t %om&ensator'$ pay plaintiff for any loss caused by the )iolation' :ines( determinate( go to plaintiff' %oercive$ to secure plaintiff the benefits awarded by the injunction' +ndeterminate( T&HHH per day which can add up o)er time' :ines Oail - D holds the keys' (+ndeterminate jail time% Retros&ective v0 &ros&ective$ o Retros&ective contempt confesses failure' D breached the injunction and the judge no longer can secure for plaintiff the conduct to which he is entitled' o Pros&ective (coerci)e% De)ised by the judge to compel defendants future conduct' What Orders Su&&ort %ontem&tC :or the court to use its ci)il contempt powers, a defendant must disobey an operati)e command capable of enforcement' 0herefore, an inDunction must descri(e in reasona(le detail and not (# re$erence t!e acts soug!t to (e restrained @ must set $ort! in speci$ic detail an unequi%ocal command. :or e*ample, language of decree did not use language which turned a contractual duty into an obligation to obey an operati)e command 8hen it merely incorporated by reference the settlement agreement, the order ignored the rule re/uire that Due Process limits the scope of an injunction (there are e*ceptions related to public nuisances (in rem injunctions on the property i'e', drug houses, house of ill repute% What is a AiolationC( A contempt order is warranted only where the mo)ing party establishes by clear and con)incing e)idence that the alleged contemnor )iolated the district courts edict 0he purpose of holding a party in ci)il contempt is to enforce compliance with an order of the court or to compensate for losses or damages' &' +s there a clear and unambiguous court order 2' +s there a clear and con)incing proof of non-compliance 3' ?as D attempted to comply in a reasonably diligent manner "he Puzzle of %riminal %ontem&t$ %oercive %ontem&t (97% of (merica :. 0agwell) :or serious criminal contempt in)ol)ing imprisonment of more than = months, constitutional protections include the right to jury trial, proof beyond a reasonable doubt, etc'
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8hether a contempt is ci)il or criminal turns on the character and purpose of the sanction in)ol)ed' A fi*ed sentence of imprisonment is puniti)e and criminal if it is imposed retrospecti)ely for a completed act of disobedience' A flat, unconditional fine is criminal if the contemnor has no subse/uent opportunity to reduce of a)oid the fine through compliance o %riminal contem&t - is a crime in the ordinary sense and criminal penalties may not be imposed on someone who has not been afforded the protections that the 7onstitution re/uires of such criminal proceedings' o Serious criminal contem&t ( in)ol)ing imprisonment of more than = months include protection of right to Oury 0rial' o %ivil contem&t sanctions - or those penalties designed to compel future compliance with a court order, are considered to be coerci)e and a)oidable through obedience, and thus may be imposed in an ordinary ci)il proceeding upon notice and an opportunity to be heard' !either a jury trial nor proof beyond a reasonable doubt is re/uired' o Paradi#matic coercive civil contem&t$ confining a contemnor until he complies with an affirmati)e command' 7an purge, carries the key' o %riminal loo3s to the &ast<coercive civil deters future violations0 o +f court is not sure what type of contempt it is, err on the side of criminal, procedural protection' Add, this gi)es a O0 to an e/uitable issue' o *istinguis! compensator# ci%il $rom criminal & 9!o gets t!e mone#E o .f to plaintiff, civil, o .f to government, criminal.

%onfinement? %ontem&t? and %ash Mone'$ A1ilit' to %om&l' (7oss v. 5uperior &ourt, 'rti3 *eal #roperty) o Willful failure to com&l' is no defense - 0here is no constitutional impediment to imposition of contempt sanctions on a parent for )iolation of a judicial child support order when the parents financial inability to comply with the order is the result of the parents illful failure to seek and accept a)ailable employment that is commensurate with his or her skills and ability' o -tIs not involuntar' servitude( A court order that a parent support a child, compliance with which may re/uire that the parent seek and accept employment does not bind the parent to any particular employer or form of employment or otherwise affect the freedom of the parent' o -na1ilit' to comply with a child support order is an affirmative defense' 0he alleged contemnor must pro)e inability to comply by P"' "he %ollateral Bar Rule( an injunction issued by a court with jurisdiction must be obeyed by the parties until it is re)ersed by orderly proceedings e)en though the order may be unconstitutionally defecti)e or in)alid (i'e', obey then appeal%' E*ce&tion( where compliance would cause irreparable injury'

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.C Parte Pur%is o Cabor strike, an injunction is issued on re/uest of employer to force employees back to work, public employer, the injunction is )iolated (continued to picket and )iolence%' o What is the collateral 1ar ruleC - 8hen the injunction was issued, and D was not in agreement, could obey and modify or appeal' 0o raise the unconstitutional argument in the contempt proceeding should ha)e been raised in the injunction proceeding that makes it collateral' o "*ception to the collateral bar rule - 7an be raised when the injunction is transparently unconstitutional )oid upon its face' o 8hats the &st Amendment argumentD - Speech )' conduct' 0his is more about conduct, so the presumption is that it is not transparently unconstitutional' 0he state has a legitimate concern in pre)enting public disorder and )iolence and promoting the free passage of traffic' Who Must O1e'C (;" #arte +avis) 7an a non-party to the original injunction proceeding act in acti)e concert or participation with Uthe original party that was enjoinedV, when the non-party subse/uently becomes the grantee to the original partys grantorD E %hile a person not named as a party is not ordinarily bound by the terms of in-unction decree and therefore cannot be punished for violating its terms, he is in active concert or participation with the name party if he participated in the original proceeding and was a real party in interest when the decree is rendered.1 0his is so that Edefendants may not nullify a decree by carrying out prohibited acts through aiders and abettors, although they were not parties to the original proceeding'F Structural -n.unctions$ aimed at the go)ernment1 the go)' is the D' A judicial mandate that protects a persons constitutional rights' 6sually aimed at controlling institutions' o Structural +njunction( injunction o)er a bureaucracy, to cure a constitutional )iolation' -n.unction Reform (Taylor v. 9nited 5tates) o Any prospecti)e relief must be ended unless there are findings of continuing )iolations of federal law' o +ssue( 8hen can 7ongress change the lawD o Sources of law( constitutional, statutory, common law' 7ongress cannot change constitutional law'

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%=AP"ER -A$ 5NE5S" ENR-%=MEN" 2 RES"-"5"-ON "he su1stantive 1asis of restitution is unDust enric!ment0 D must ha)e a benefit that it is unjust for him to retain' 0hat means, it is always measured by Ds unjust enrichment' o 0here is no reco)ery for benefits )oluntarily conferred upon another' o 0he purpose of restitution is to return the status /uo by compelling D to return specific property or by awarding the injured party a sum of money e/ui)alent to the )alue of Ds benefit' o 6njust "nrichment is the 7AAWwhen cannot find a tort or .' 6sually no relationship bw the P and the D' and may be found e)en when both parties are innocent'
5n.ust Enrichment<Restitution

Le#al Su1stitutionar' )al a's mone'+ ( ,uasi 3

E,uita1le ( constructive trust ( e,uita1le lien -n s&ecie ( su1ro#ation ( re&levin )&ersonal+ ( accountin# for &rofit - e.ectment )real+

,uantum counts ( Huantum meruit ( Huantum vale1at

common counts ( mone' had and received )&ersonal &ro&0+ KKKKK ( mone' ( #oods sold and delivered )&ersonal &ro&0+ &ro& not KK ( use and occu&ation )realt'+

5n.ust Enrichment Rule( Ane party should not be entitled to benefit at the e*pense of another b<c of an innocent mistake or unintentional error' D must ha)e recei)ed a benefitWwhich may be regarded by the D as neutral or e)en detrimental, and must be unjust' Aolunteer< Donor (Iood Samaritan or Iift% - P loses b<c DXs enrichment is not considered unjust' 6sually cannot reco)er if a )olunteer<donor, but there are a few circumstances where Ds enrichment is considered unjust' +'e', the burden may be on the D to either deny or payWsilence wont sa)e him' Also, when the D clearly opposes the action leading to the EenrichmentF, but the P does it anyway' D does not )oluntarily accept a benefit which it would be ine/uitable for him to retain' +nstead, P E)olunteeredF (officious intermeddler% to do so and cannot collect' Restitution at la 2 Huasi(%ontract$ the legal remedy of restitution in money arose from the common law action of assumpsit' 0he assumpsit action was a proper remedy

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for implied in fact ., as well as implied in law . that are not .s at all (i'e', as no promises or agreements% but rather instances of unjust enrichment, where the law imposes an obligation' Huantum Meruit )le#al? su1stitutionar'+$ EAs much as he deser)es or as much as ser)ices are worthF' 0wo classic types of contracts to discuss /uantum meruit are employment contracts and ser)ice<contract out contracts' @uantum Meruit is a bit ambiguous b<c it can be either an implied in law (fiction created by the court% or implied in fact (real contract, determined by conduct of the parties% contract' $"( if measured by Ps loss then implied in fact1 if measured by Ds unjust enrichment then implied in law' =o 6' 70 to Measure Dama#es$ Reasona1le FMAWobjecti)e measure of either<both P J Ds loss<benefit Reasona1le value of 1enefit to D )im&lied in la +0 Reasona1le value of services rendered$ P may reco)er for those e*penditures made in reliance on Ds representations and that the P otherwise would not ha)e made (e)en if D got no benefit%' +f D is wrongdoer, P should at least be placed in as good as a position as he originally was in, e)en though D must pay more than he benefited' 7ourts ha)e often implied an obligation to pay based upon the theory that performance at anothers re/uest may itself constitute a benefit' (0his is )ery similar to measuring promissory estoppelWmeasuring the Ds unjust enrichment by assessing the Ps cost of reliance'% Restitution in E,uit'$ a0 %onstructive trust( a constructi)e trust imposes a duty on D to transfer property to P' +t is imposed by law without regard to intentions of the parties and unlike an e*press trust( 60 D has legal title to the property1 70 $etention would result in unjust enrichment1 and 80 $emedy at law is inade/uate SP may benefit from a constructi)e trust in that it permits P to claim specific property, gi)ing P priority o)er other creditors of D' S"ffect of sale to bona fide purchaser( transfer of property to a B:P cuts off Ps right to a constructi)e trust o)er the property, but does not cut off Ps rights to proceeds arising from the transfer cuts off e/uity' %onstructive trust )e,uita1le+- 0he original property is gone' 8hen property is ac/uired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial interest, e/uity con)erts him into a trustee and the court orders the D to con)ey title' (+f the still has the property, then apply reple)in' +f the property increases in )alue, the is entitled to the proceeds'% ?ighest priority in the law (higher then homestead% DoesnIt have to 1e misconduct 1' the 0 -f one &art' &a's consideration and the other doesnIt? the &a'in# &art' trum&s
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o 0he bona fide purchaser of property would take free of the constructi)e trust, but the gratuitous donee does not (e)en if totally innocent% o Some courts are more lenient re tracing' 10 E,uita1le lien$ an e/uitable lien is a charge on property to secure a debt or other obligations, and gi)es the holder of the lien the right to sell the property to satisfy the debt' Re,uirement$ an e/uitable lien may be imposed where there is an unjust benefit traceable to property owned by D' %om&areL%onstructive trust( P often has the option of a constructi)e trust or e/uitable lien remedy' ?owe)er, where money is misappropriated to impro)e land already owned by D, and e/uitable lien is the only a)ailable remedy' Lien enforcement( a lien is enforced by foreclosure and sale, but a lien is cut off by prior sale to a B:P' c0 Su1ro#ation$ subrogation applies when one person non-officially discharges an obligation for which another is primarily liable and which the latter out to pay' $esult( P is subrogated to the position of the creditor and is entitled to any security interest or priority the creditor may ha)e had' d0 Accountin# for Profits$ "/uitable restitution is based on disgorgement of illgotten gains and thus may result in an accounting for profits that P in good conscience should ha)e recei)ed' +t is measured by the defendants unjust enrichment <istler %. Stoddard( 0he doctrine of 6" is an e/uitable one, pro)iding that one party should not be allowed to benefit at the e*pense of another because of an innocent mistake or unintentional error' o Before being held liable for restitution, D must ha)e recei)ed a benefit' o Ds enrichment by itself will not trigger restitution' +t must be unjust' o @uasi 7ontract( Cike damages, always T' But hard to tell the difference' Oust because its money doesnt mean its @7, because e/uitable remedies can be T also' <ossian %. American 5ational /nsurance Compan# Pro tanto( up to the contract price' o -s HM limited 1' the ! &riceC !ot limited if Plaintiff is a non-breaching party o +s Cimited if Plaintiff is the breaching party' @uasi contract implied in law does not suppose any intent between the parties but imposes an obligation upon a party who has recei)ed a benefit' Cook at Ds 6" and determine what D owes P' <naus %. *ennler o An im&lied %ontract is one which reason and justice dictate, and is founded on the e/uitable doctrine of 6njust "nrichment'
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o Recover' under an 5n.ust Enrichment theor' re,uires a sho in# that the defendant has voluntaril' acce&ted a 1enefit hich it ould 1e ine,uita1le for him to retain ithout &a'ment since the la im&lies a &romise to &a' com&ensation hen value of services are 3no in#l' acce&ted0 o Aoluntar' acce&tance onl' +f a benefit is conferred in the face of opposition and disinterest, it falls in the category of a gratuitously conferred benefit for which /uasi-contractual relief is not a)ailable'F -m&ortant$ has to be a )oluntary acceptanceY o A person who officiously confers a benefit upon another is not entitled to restitution therefore' o #olunteer<officious intermeddler( 4 loser' 8hat could the P ha)e done hereD An injunction because of an impending nuisance1 an easement by necessity1

" o !inds of -m&lied %ontracts$ (must differentiate between these two on the e"am) 60 +mplied-in-law (@uasi-. is a synonym% a fiction created by the court to pre)ent unjust enrichment 70 +mplied-in-fact based upon conduct of parties S@uantum Merit can be either an implied in law or implied in fact . Measurin# the DefendantIs Benefit$ Services Camp(ell % Tennessee Valle# Aut!orit# +s the measure of reco)ery to be determined by the amount of money that would be necessary to ac/uire on the open market the goods or ser)ices from which the benefit is deri)ed, or is the measure of reco)ery how much the benefit has been worth to the person upon whom it was conferredD !ormally arises in construction and person ser)ice cases' i'e', ser)ices performed (that is what /uantum merit is% o +mplied in fact( damages are measured by using the . agreed upon for reco)ery o +mplied in law( damages are measured by using either( &' $easonable<fair market )alue of ser)ices performedS 2' reasonable )alue of the benefit to D 3' Eupper limitF amount agreed upon by the parties in the unenforceable . (this is the one that is preferable% ?aras! %. S#;es *atatronics' /nc) o plaintiff may reco)er for those e*penditures he made in reliance on Ds representations that he otherwise would not ha)e made (i'e', he may reco)er his reliance interest% while this is odd, this is a way of measuring damages for un-ust enrichment o 0he basic aim of restitution is to place the P in the same economic position as he enjoyed prior to contracting
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o 0he P reco)ers the reasonable )alue of his performance whether or not the D in any economic sense benefited from the performance (here, D had no benefit that is why that is important% o +f what the P has done is part of the agreed e*change, it is deemed to be recei)ed by the D .ar!art %. 9illiam 0o) Co. 7an a party who e*pends funds and performs ser)ices at the re/uest of another, under the reasonable belief that the re/uesting party will compensate him for such ser)ices, reco)er in @M although the e*penditures and ser)ices do not directly benefit property owned by the re/uesting party' o Sometimes Ds 6" can be measured by Ps reliance interest i'e', here they used the promissory estoppel remedy' o But its just another fiction, its a better argument to say that D should reco)er under promissory estoppel' 8hat you must show for promissory estoppel( &' $epresentation 2' $easonable reliance on the representation 3' injury "hree interest in a ! 60 E*&ectation 70 Reliance 80 Resitutionar' interests Dama#es 2 e*pectation interests S&ecific &erformance 2 e*pectation interests Recission 2 consistent with restitution (put party in pre-.% Reliance -nterest 2 +n preparation to perform P not directly benefiting the other party out of pocket e*penses incurred by the

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EH5-"ABLE RES"-"5"-ON "he %onstructive "rust (5imonds v. 5imonds) 8hen property has been ac/uired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial interest, e/uity con)erts him into a trustee'F A constructi)e trust arises when a person holding title to property is subject to an e/uitable duty to con)ey it to another on the ground that he would be unjustly enriched if her were permitted to retain it' (7AA unjust enrichment remedy( constructi)e trust' o A fiction created by the court to pre)ent unjust enrichment and is measured by Ds unjust enrichment' o -m&ortant$ A D must ha)e obtained title o)er property which the P is seeking' o also need tracing (i'e' trace the Ps property into the new property o if D still has Ps property then remedy is ade/uate then dont need a constructi)e trust if D has sold the Ps property to a third person, P cannot get property back from a bonafide purchaser' o Dont need a breach of a fiduciary duty1 dont need wrongdoing of D (can be imposed o)er an innocent party% o Ii)ing consideration trumps gratuitous donees (i'e', here there was a di)orce settlement re/uiring the ? to maintain life insurance for the first wife1 by failing to do so and then ha)ing the 2d wife be the only named beneficiary, the 2d wife is a gratuitous donee o 7annot impose a constructi)e trust against a B:P "racin# 7onstructi)e 0rust )' "/uitable Cien %onstructive trust ori#inated in trust la ? i0e0? 1reach of a fiduciar' dut'0 0hree types of .s<trusts( 60 "*press 7ontract - "*press trust 70 +mplied in fact . - $esulting trust 80 +mplied in law . - 7onstructi)e trust !o breach of fiduciary duty is re/uired today to impose a constructi)e trust' E,uita1le Lien is limited 1' amount ta3en from P and doesnIt re,uire that the ne &ro&ert' 1e ac,uired 1' the PIs &ro&ert' +f property appreciates in )alue, use constructi)e trust1 if it depreciates use e/uitable lien 7onstructi)e 0rust is one of the highest priorities under the law, e)en o)er homestead e*emption' o "racin#( $e/uires P show that Ps property came into the hands of D and D took the property and e*changed it for other property' o E,uita1le lien$ any time you can impose a constructi)e trust in the alternati)e you can impose an e/uitable lien, but the re)erse is not true' o D embe>>les ;H M buys blackacre with T today blackacre worth T&HH,HHH' 7an P ask for 7onstructi)e0rust, "/uitable Cien, and for how muchD 70 for
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T&HH,HHH, "C for T;H,HHH as long as you can trace the money into the new property, no matter how much the property is worth, you get it' o +f the property appreciates, use a constructi)e trust' +f it depreciates, use an e/uitable lien' o Possi1le e*am H$ Rate the remedies$ hich is the 1est? 7d 1est? etc0 Are remedies cumulati)e or in the alternati)eD

Legal Damages Replevin

Remedies for Conversion Equitable quasi k Constr. Trust equitable lien

4$orced sale -in specie -wai)e tort -B:P cuts off e/uity -fm) at time J Zdetention damages J sue place of con)ersion (for loss of use% in assumpsit -tracing (D has e*changed Z pre-judgment or sold property and no (loss of use% longer has it interest Z conse/uentials Z possibly puniti)es

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Stephanie Burke

Definition of %onversion( +ntentional substantial unreasonable interference with the property rights of another' (!ominal damages are possible<tort )ersion of threat<trespass is the smaller )ersion of tort% Essentiall' su&&orts five remedies )these are all ForG 2 that is 'ou choose hich remed'$ 60 Dama#es- forced sale (see above for measure of damages) 2. Huasi contract- either 6' 7ommon courts or 7' @uantum meruit wai)ing tort Z sue in assumpsit 80 Re&levin - Z detention damages (getting the personal property back% 90 %onstructive "rust D e*changed Ps property for new property :0 E,uita1le Lien o 0he first three are used when the person still has the property' o 0he last two are not a)ailable to B:Ps because they ha)e e/uitable title and that cuts off the possibility of e/uitable remedies' o 7onstructi)e trust is one of the highest priorities in the law and is most secured (in terms of actually seeing your money% discuss this if ha)e to rank remedies Dama#es$ Ienerally measured at the )alue of the property at the time and place of the con)ersion' ?owe)er, the court may take into account subse/uent fluctuations in the )alue of the con)erted goods (i'e', measure )alue at time of judgment%' 8hen Stocks are in a fact pattern, consider e*ception to general rule' NO"E$ +f multiple Ds, once judgment is paid, title )ests retroacti)ely in defendant who pays judgment' 0herefore, forced sale (judgment for damage payments% by one con)erter relie)es the other defendants of tort liability' Re&levin( (Cegal, in specie, restitutionary relief for 7AA of con)ersion% D takes Ps property and so changes it that it no longer resembles the Ps original property' May reco)er the specific personal property that has been wrongfully taken<detained and detention damages (detention for loss of use% - $eple)in is not a)ailable when the original con)erter doesnt ha)e the property - 8hen you wai)e the tort and sue in assumpsit, you sue for the appreciation and reple)in to get the appreciated goods in specie' - Must pro)ide a person w< notice and opportunity to be heard before (pre sei>ure of the property% statutory reple)in may be enacted' Detention Dama#es$ )loss of use+ 60 $ental )alue often measured by this 70 Pro-rated portion of a lease 80 Cost re)enue from not using 90 A)ertime wages from not ha)ing the property :0 7ost of using a spare thing

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Ascession( Defense to reple)in' +f properly in)oked, cuts off Ps right to reple)inW property is so different in form that P not entitled to it anymore J )alue has appreciated' (?owe)er, other remedies are still a)ailable% Anly innocent con)erter can in)oke ascession' E,uita1le re&levin G not much difference between e/uitable and legal reple)in' Anly a)ailable where damages would be inade/uate (uni/ue% Similar to injunction (no legal remedy and uni/ue property% !o jury trial "jectment does to real property as reple)in does to chattels' E.ectment( (legal, in specie, restitutionary relief% does to real property what reple)in does chattels' "jectment Z mesne profits )' :orcible "ntry J Detainer (seeking re-possession1 claiming one is in lawful possession%' $epossession' %onversion vs0 "res&ass - 7on)ersion 4 major interference - 0respass 4 minor interference 6sually choose between trespass and con)ersion' Dont ha)e to show injury for con)ersion, unlike trespass to chattel Anly the legal remedies of con)ersion are a)ailable when the still has the property' 8hen the pays the judgment, the title )est retroacti)ely and good title passes to the subse/uent purchaser' 7ourt may allow the property back and the money made' 8hen the property is changed too much, the B:P is still liable for the :M# of the property when recei)ed, but doesnXt ha)e to gi)e it back' E,uita1le Lien- 0he ma*imum reco)erable is the )alue when it was taken' 0herefore, if the property appreciates, use constructi)e trust, and use e/uitable lien when it depreciates' $arely do the courts make you pro)e the legal remedy is inade/uate for these two remedies' $"( constructi)e trust as a slight ad)antage bc a secured creditor' Rental value- 7an either be the Xs loss (damages% or Xs unjust enrichment (/uasi k%' ?as to be continuous use and occupation'

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[[[[[[[[[ %ha&ter : 2 PROPER"4 -N"ERES"S %hoosin# the Remed' 1aram %. ?rugia Payment by one con)erter (in a multiple D case% relie)es the other Ds' ?ere, it was a forced sale' 0itle )ests retroacti)ely to the date of the con)ersion therefore P can not sue anymore Ds' 8hat if doc sued in /uasi contractD 8ai)e the court and sue in assumpsit' 7ould ha)e gotten more money use when Ds 6" e*ceeds Ps loss' $eple)in( 70( no because if D still has Ps original property, there can be no constructi)e trust' 9elc! %. <osa;# %onversion v "res&ass to %hattels M Both are intentional torts o %onversion is a major interference - 6nder con)ersion damages is usually in the form of a forced sale' :M# at time and place of con)ersion, plus loss of use' o "res&ass to chattels is minor interference (therefore, by definition, you get the chattel back<con)ersion damages, you dont get the chattel back% Ieneral rule for measuring trespass to chattels damages( diminution of )alue' 0wo ways of measuring diminution of )alue( &% )alue at time and place of con)ersion )alue still left upon return1 and 2% DD o When is it 1etter to use ,uasi contractD Always money, measured by Ds unjust enrichment1 @7 is better when Ds 6" e*ceeds Ps loss' !ot the case here' Tra!an %. ?irst 5ational 1an; o$ +uston Good faith is no defense to the tort of conversion0 Different ways<times to measure damages( o Date of con)ersion o Date of judgment o Somewhere between the two highest )alue reached between the two dates o ?ighest )alue within a reasonable time after P disco)ers the con)ersion -m&ortant$ 0his case in)ol)ed stock which fluctuates in )alue if you see stock in an e*am, then discuss that the measure of damages could )ary as set forth abo)e' Al a's loo3 at hether it as a illful or innocent converter 2 if willful, there is an argument for using the higher amount

%AL%5LA"-NG DAMAGES Measured by Ps loss rather than Ds unjust enrichment

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Wa's to measure 7ost to repair $ental )alue Diminution of )alue Cost business profits General Dama#es$ Diminished Aalue v0 %ost to Re&air 7ourts usually think of general damages as damages measured by market )alue' 0hey usually re/uire a reason to depart from )alue measure o Diminished Aalue - A dominant general damages measure for property is diminished )alue' o %ost to Re&air - An alternati)e ,e)lett %. 1arge 1ertie !egligent Damage to personal property( Measured by( 60 %ost to re&air less speculati)e than diminished )alue, limited by pre tort fair market )alue' $easonable cost of repairing plus allowance for depri)ation of use so long as the repair e*penses do not e*ceed the ships just )alue at the time of casualty' 70 Diminished value (diminution in )alue% subtract post-)alue from pre-tort )alue 80 Rental value 90 Lost 1usiness &rofits -m&ortant$ ?ow do you choose between diminution in )alue and cost to repair Depends, howe)er, generally, the party can choose as long as it doesnt e*ceed pre-tort )alue (unless e*ception below applies% (the party in the best position to minimi>e loss should be the one with the burden of minimi>ing it as a theory to argue in an e*am%' +f Defendant was willful in his conduct, that could be a factor in a court allowing a higher le)el of damages' 7ost to repair is more objecti)e and therefore more reliable and could be argued as a reason for using that measure1 Ar Ii)e P the option to choose between two as long as it is reasonable1 use the higher whene)er the Ds conduct is willful Personal Reason e*ce&tion (Orndor$$ %. C!ristiana Communit# 1uilders) o Personal Reason e*ce&tion ( if a building such as homestead is used for a purpose personal to the owner, the damages ordinarily include an amount for repairs, e)en though this might be greater than the entire )alue of the building' "his is an e*ce&tion on the ceilin# on cost to re&air 2 i0e0? that 'ou canIt #et cost to re&air if it ould e*ceed the &re(tort value0 o All that is re/uired is some personal use by them and a bona fide desire to repair or restore o Personal e*ception justifies higher award of damages - +ts important for owners to ha)e the property in the way that they want it' 0here are e)en cases where Ds actions increase the )alue of Ps property' 7ourts say this is irrele)ant, e)en if it is economically wasteful to put the property back to its original condition'
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8hen diminution in )alue and cost to repair yield nothing, can go for Eloss of useF<Fopportunity costF $ental )alue can be a measure of damages or a measure of unjust enrichment

Lost 5se ( uwait (irways &orp. v. 'gden (llied (viation 5ervices) Cost use is a measure of damages (cost to repair 4 general damages% 0his case is about conse/uential damages, howe)er, because the damages that were being awarded were as a conse/uence of the Ds action but were not actually losses that were suffered' o Five a's to measure loss of use$ FO&&ortunit' costG 60 $ental fee' 70 A portion of the lease, i'e', = days' 80 Cost profits minus e*penses sa)ed' 90 +ncreased e*penses, wear and tear, o)ertime, etc' :0 Depreciation( depreciation o)er = days of a =H year life airplane' o 8hether proof of actual pecuniary loss is re/uired in order to reco)er for loss of use of a damaged chattel, and whether the reasonable cost of securing a replacement for the damaged chattel may be reco)ered e)en if no substitute is actually rented' o EApportunity costF lost opportunity i'e', you lose the potential for use -is the argument used by the court to allow the reco)ery of conse/uential damages despite the fact that the airline, here, suffered no real monetary loss' Dama#es for Dum&in# (+on v. Tro-an &onstruction &ompany) $eal Property cause of action 0respass to realty "he list of &ossi1le remedies for someone elseIs dum&in# on land includes$ damages, an injunction and restitution or a combination of them' Apply cost to repair and dimunition of )alue $ental )alue is objecti)e measure that straddles the fence of clients loss or defendants unjust enrichment' Measure of damages A!D restitution Rule$ the detriment caused by the wrongful occupation of real property (e*cept in certain cases of willful holding o)er wherein the damages are higher% is deemed to be the )alue of the use of the property for the time of such occupation ( rental value%' !o e*ception in cases where the P did not intend to use the land or to rent it out co that the court can do no other than apply that measure, namely, the E)alue of the use'F 0hat the owners did not intend to make any use of the land themsel)es does not depri)e them of their proper award'

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$ental )alue is a way of measuring damages (and can also be a measure of /uasicontract because it is an objecti)e measure% (defendants sa)ings can also be a measure%

0respass to realty is an intentional tort because where you are is )oluntary e)en if you didnt intend to be on someone elses property' $emedies( 6egal ;quitable "jectment (restitutionary% J mesne profits @uiet title (if in possession% (if not in possession% Non(&ecuniar' Dama#es (0ond v. (./. 0elo &orp) Sentimental value v0 actual value of #oods ' - Ioods with primary )alue in sentiment' /$ t!e %alue t!e o(Dect !as is primaril# sentimental %alue' t!en can use t!is measure Ethe reasona(le s&ecial value of such articles to their o ner ta3in# into consideration the feelin#s of the o ner for such &ro&ert''F Actual worth or )alue of the articles to the owner for use in the condition in which they were at the time they were destroyed, e*cluding any fanciful or sentimental considerations' Such property is not susceptible of supply and reproduction in kind' Su1.ective v0 o1.ective standards o Abjecti)e court states that it will use the EreasonableF )alue' o Subjecti)e special )alue to the owner of the goods o 7ourts are reluctant to award damages for sentimental )alue too speculati)e -- Fraud - "asy to fake ?ere, the property was destroyed, therefore not repairable and cannot use diminution in )alue Limitin# dama#es$ Economic Loss (.n *e &hicago <lood 6itigation) Economic loss rule - no reco)ery in negligence cases for economic loss absent pri)ity of contract, or damage to person or property' o +f defendants were held liable for e)ery economic effect of their negligence, they would face )irtually uninsurable risks far out of proportion to their culpability, and far greater than is necessary to encourage potential tort defendants to e*ercise care in their endea)ors' o Moorman e*ceptions( &' 8here P sustained damage from a sudden or dangerous occurrence1 2' But for damages to be reco)erable in tort, the sudden, dangerous, or calamitous occurrence must still result in person injury or property damage' 3' 8here Ps damages are pro*imately caused by Ds intentional, false representation (:$A6D% i'e', can reco)er economic loss in fraud cases1 9' 8here Ps damages are pro*imately cause by a negligent misrepresentation by D in business of supplying info for guidance of others in their business transactions'
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Economic Loss is Recovera1le then in$ 60 8hen there is a . that pro)ides for it 70 +ntentional torts like fraud 80 +njury to person or property 90 8here Ps damages are pro*imately caused by a negligent misrepresentation of a D in the business of supplying information Statutor' Re&levin (<uentes v. 5hevin) :SA 5M'H&( Any person whose goods or chattels are wrongfully detained by any other person may ha)e a writ of reple)in to reco)er them' 0here is no re/uirement that the applicant make a con)incing showing before the sei>ure that the goods are, in fact, Ewrongfully detained'F $ather, :lorida law automatically relies on the bare assertion of the party seeking the writ that he is entitled to one and allows a court clerk to issue the writ summarily' :ile complaint and a security bond' !o pre-sei>ure hearing' !o 7ompliance with Due Process - Pre.ud#ment Re&levin pro)isions work a depri)ation of property without Due Process of law insofar as they deny the right to a prior opportunity to be heard before chattels are taken from their possessor' +eple%in is an action to recover specific personal property that has been wrongfully ta!en or detained, with an incidental right to damages caused by reason of such detention' o Detention damages is also a synonym for loss of use o Self-help is unlawful in landlord tenant - Candlord must follow stats, does not include changing the locks, its a summary proceeding (happens almost immediately, limited in scope%' o 7hanging of locks 4K con)ersion of all her property in the apartment' 0here can be no detention damages awarded where the D did not pre)ent the P from coming and using the property Measuring compensation for loss of use, i'e', detention, can be rental )alue

E,uita1le Re&levin (&harles 5im!in 4 5ons v. 7assiah) V.+4 +A+. A court of e/uity may compel the deli)ery of a specific chattel wrongfully withheld' Anly reco)erable where damages would be inade/uate (i'e', items are uni,ue and cannot be replaced by purchase on the open market%' +n e*am, we are talking about legal reple)in, not e/uitable' Recoverin# And Protectin# Real Pro&ert' Protectin# Real Pro&ert' ( ruvan v. =>->> %oodlands (venue &orp) 7AA( trespass to realty' $emedy here was damages and was measured by rental )alue' "res&ass to Realt'$ Physical intrusion, unauthori>ed, into the property of another' !ominal damages are a)ailable'
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5se and Occu&anc' was also mentioned in this case which is a /uasi-. remedy' 0hink use and occupation for real property (as opposed to goods sold and deli)ered1 money had an recei)ed which are used for personalty%' Use must (e continuous to use t!is remed#' Always associated with /uasi-. and realty' 8ant to use this remedy when Ds unjust enrichment e*ceeds Ps loss' Prescri&tive easement$ functional e/ui)alent of title after using something for so long in an ad)erse possession sort of way1 interest in real property'

?enton %. Fua(og Countr# Clu( 7AA( nuisance and trespass to realty (in)asion of golf balls% this is the golf case where the balls were landing on their property and hitting the house and stuff' $emedy( +njunction (stop the balls% and damages Private Nuisance is a real property tort1 use and enjoyment of the Ds property that interferes with the use and enjoyment of Ps property neighbors in a fact pattern raises this on an e*am /mportant Definition$ +ntentional and substantial and unreasonable interference with the plaintiffs use and enjoyment of the property' 8hat remedies are associated with 0respass to $ealty 60 Dama#es compensation for replacing glass, loss in rental value of the property while in-ury is occurring 70 -n.unction abate the nuisance is what the court would say 80 Huasi(! S7ompensatory damages are a)ailable for past injury such as damage to property and mental anguish due to nuisance' +njunction is a)ailable to stop continuing nuisance or trespass' Damages are an inade/uate remedy for a continuing trespass' "res&ass to Realt'$ measure of dama#es &' Dim in )alue 2' 7ost to repair 3' $ental )alue 9' Cost business profits (maybe% Salso associate injunctions with trespass to realty Huasi(! can 1e measured 1'$ &' Market )alue of Ds unjust enrichment 2' Subjecti)e measure of Ds benefit 3' $ental )alue 9' $eliance interest +n con)ersion, fair market )alue may not be an accurate measure where property fluctuates rapidly in )alue (stocks% :orced sale is a synonym for con)ersion $eple)in is in specie because you get the actual return of the property (always think of reple)in Z detention damages%'

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Doctrine of Accession$ 8hene)er you think of reple)in think of doctrine of accession' D con)erts property and then changes property so substantially that it is )irtually a different property (i'e', D takes apart bike, takes it apart and uses the parts to make an in)ention% in)oked by D to cut off right to reple)in and it is in)oked by Ds being an innocent con)erter'%1 generally the changing of form must be an enhancement of )alue' (contrast, innocent purchaser that cuts of right to e/uitable remedies%

Damages and @uasi-. are substitutionary $eple)in and @uasi-. are legal restitution H5AS-(! 2 %OMMON %O5N"S Money had and recei)ed (if the D had sold the Ps property, then use this common count% Ioods sold and deli)ered (if D still has the Ps property, then use this common count% 6se and occupation (real property% MONE"AR4 RE%OAER4 "RANS%END-NG %OMPENSA"-ON Willfulness (?rays /arbor &ounty v. 0ay &ity 6umber, &o) 7AA( con)ersion (innocent%1 remedy( damages measured by( &' +f ori#inal con)ersion was innocent, stum&a#e value (at time and place of con)ersion% (stumpage )alue means trees being in place% doesnt matter if subse/uent con)erters were in bad faith 2' +f original con)ersion was willful, then by enhanced value (at time and place of Ds con)ersion% this puniti)e measure of damages is a)ailable where a trespass or con)ersion is willful or in bad faith' "re1le v0 &unitive dama#es$ treble damages are those granted that gi)e 3* general damages (or you could say compensatory damages%1 puniti)es are to punish and deter' 7an reco)er treble e)en against an innocent purchaser which tells you that the point of these damages is not to punish and deter, but instead are compensatory' Restitution ('lwell v. ,ye 4 ,issen &o) 7on)ersion of an egg washing machine' 0his case is an e*ample of E ne#ative un.ust enrichmentF negati)e unjust enrichment is how much the D sa)ed by his con)ersion and another a' to measure ,uasi(!' (this is similar to a reple)in Z detention damages% amount D sa)ed by his conduct' MEAS5R-NG 5NE5S" ENR-%=MEN" 60 Cost rental )alue 70 Cost business profits an accounting for profits 80 $eple)in( return object and sue for detention damages' 90 Ds actual benefit
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:0 :M# of Ps ser)ices ;0 $eliance 7onstructi)e 0rust - 8hat is the clue to discussing constructi)e trust( when defendant takes the plaintiffs property and sells it' Also clue for discussion money had and recei)ed' Sc!losser %. 9el; && 7AA( con)ersion' 6se unjust enrichment when you ha)e neither a tort nor a contract, then that is time to use unjust enrichment' $ightfully taken, wrongfully detained was the basis for this court using unjust enrichment as the coa' 7ommon count was goods sold and deli)ered' 8hat was the Ds unjust enrichment where she ne)er )iewed<used the tapesD Private Nuisance (Per Se )' +n :act (Pig in the Parlor% %onversion (( %onstructive "rust -0racing against successi)e transferees -Iood :aith +mpro)ements -$estitution -"jectment Z Mesne Profits "res&ass to Realt' -Accounting for Profits 4 e/uitable restitution -8ai)ing the tort Z suing in assumsit When does it matter if the conversion as innocent of &' Stumpage )alue )' enhancement in )alue 2' Puniti)e<treble damages 3' Doctrine of accession 9' P can choose the measure if the con)ersion was willful ilful

-attson %. Commercial Credit 1usiness 0oans' /nc 7AA( con)ersion1 the remedy is( Bona Fide Purchaser - +f they purchased in good faith without knowledge that the money they recei)ed was proceeds from stolen property, they would be like cuts off tracing and cuts off the rights to a constructi)e trust "racin# doctrine operates against innocent transferees who recei)e no legal title and transferees who are not bona fide purchasers and recei)e legal but not e/uitable title' +f either type of transferee e*changes the ac/uired property for other property, or recei)es income from the ac/uired property, tracing may apply' Basically, follow the property (or money% Should al a's consider tracin# ith e,uita1le restitution of constructive trust? e,uita1le lien? and accountin# for &rofits0 0here is no theoretical limit on the number of transactions or changes in form through which the claimant will be allowed to trace'
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Aames %. 1aile# -- Plaintiff mistakenly impro)es someone elses land, D had no notice' "*cept to the e*tent that the rule is changed by statute, a person who in the mista!en belief that he or a third person on whose account he acts is the owner, has caused improvements to be made upon the land of another, is not thereby entitled to restitution from the owner for the value of such improvements. +efendant must sue the #laintiff to clear the title. ;-ectment is remedy, plus mesne profits' EBou made money off the impro)ement you made by mistake to my land'F Betterment statutes( protect the in)estment of a person who impro)es land which he later disco)ers is not his own' Mesne &rofits( Awner of property impro)ed because you ha)e not only impro)ed the property, but also deri)ed benefits from it' o 0o the e*tent that the land has been increased in )alue whene)er( & the true owner obtains a judgment in an e/uitable proceeding 2 the true owner commences an action of trespass or other action for mesne profits' 0ied to ejectment' Mesne profits are attached to ejectment as detention damages are attached to reple)in' Absent negligence, bad faith, or ac/uiescence by owner, cannot get relief When 'ou see that someone has mista3enl' constructed im&rovements on someone elseIs &ro&ert' (( Always likely to be talking about restitution Note$ Fraud in -nducement +f lies are made in inducing another to enter into a contract that is clue to discuss fraud in inducement of . and this is an intentional tort (can then associate with puniti)e damages% puniti)e damages are rarely awarded in a breach of . case' Breach of warranty (under 677% .d)ards %. 0eeBs AdmBr "res&ass to Realt' unauthori>ed physical in)asion of anothers land trespass to realty was coa1 remedy was 5n.ust enrichment ( Ste&s 60 Are damages an optionD 70 8hat other remedyD +njunctionD 80 Both can be reco)eredD !ot double unless damages includes future harm, permanent damages, they are past, present and future' 90 Alternati)e to damages or injunction( restitution( start with /uasi contract( . implied in law, wai)e tort and sue in assumpsit' :0 $eal property( use and occu&ation0 +t re/uires, strictly speaking, that use and occupation must be continuous, not intermittent, here it might be seen as intermittent' ;0 8hat about ejectment and mesne profitsD +ts legal, and its in specie (want the same thing back%, and its restitutionary' "jectment for real property )' reple)in for personal property'
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Accountin# for Profits$ B<c Ds trespass was willful P argued that accounting for profits should use the gross profits rather than net profits measure (this is a rental value measure)' ?owe)er, bc D was only unjustly enriched to the e*tent of net profits, the court uses that measure' -nnocent v0 illful ( "*plain innocent trespass( presumably you intend to be where you, whether willful or not' Mesne &rofits( +t is well settled that in an action to reco)er mesne profits, the plaintiff must show in the best way he can what those profits are, and there are two modes of doing so, to either of which he may resort he may either pro)e the profits actually recei)ed, or the annual rental )alue of the land' 0he latter is the mode usually adopted' 8here there is occupation of a farm or land used only for agricultural purposes, and the income and profits are of necessity the produce of the soil, the owner may ha)e an account of the proceeds of the crops and other products sold or raised thereon, deducting the e*pense of culti)ation' Restitution( /uasi contract( common counts( only use and occupation can be applied to real property( only applies if continuous( but still apply /uasi contract( Ance the minerals is se)ered, it becomes personal property' (con)ersion% !o longer use and occupation' Huasi contract$ Measured 1' defendantIs un.ust enrichment ( different a's$ Rental value Fair mar3et value Benefit conferred Su1.ect value in the hands of the D Reliance interest Assum&sit ( An action e* contractu as distinguished from an action e* delicto' ?ence, in order to sustain the action, it is necessary for P to establishD

BALAN%-NG "=E =ARDS=-PS (,arrison %. /ndiana Auto S!redders) Pu1lic v0 Private Nuisance - 7ould it be public nuisanceD Ireater the number of people affected, more likely to be public' +n a public nuisance P is typically the go)ernment, although could be pri)ate' What distin#uishes a &u1lic from a &rivate nuisance According to Sanche>, a lot of people are effect in public (though this can also be in a pri)ate nuisance%1 the go)ernment or city typically represents the public in a public nuisance case (a pri)ate citi>en can represent in a public nuisance case if he can show that his injury is different in kind from the way the public is generally effected by it otherwise, lack standing to bring a public nuisance' ($emember the gang case where Iangs are a type of public nuisance' Cegal remedy inade/uate<criminal prosecution in gang case was inade/uate'%
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Private Nuisance an intentional tort? su1stantial unreasona1le use and en.o'ment of oneIs &ro&ert' that interferes ith the use and en.o'ment of another oneIs &ro&ert'' 0hink about damages and<or injunction and puniti)e damages (bc it is an intentional tort% cce Z actual malice for puniti)e damages' Nuisance$ intentional substantial unreasonable use by D of his or her property which interferes with Ps use and enjoyment of his or her property' o Per se( at all times and under all circumstances, plus threat of imminent harm to neighbors' +mminent and dangerous harm (like an emergency% -mminent threat to &u1lic health and safet'? says 5anche3' 7alling it per se affects the analysis for an injunction i'e', you do not ha)e to balance the hardships and the court must issue the injunction upon a finding of a nuisance per se' o Effect on remedies( "asier to pro)e (cause of action%1 injunction( process( is legal remedy ade/uate calling it per se probably gets o)er this1 threat of imminent harm, yes, balancing the hardships( nuisance per se will impact this by saying there is no balancing of the hardships' o Nuisance in fact( something in the wrong place, isnt always a nuisance just where it is located makes it a nuisance' !uisances primarily because of the circumstances or the location and surrounding of the acti)ities, rather than the nature of the acti)ities themsel)es' #ery often this type will present the offensi)e acti)ities of an otherwise lawful business, acti)ities that are being conducted in such a manner so as to become a nuisance' Pi# in the &arlor analogy it is a nuisance because of where it is (i'e', a pig in a barnyard would not be a nuisance% o 7annot ha)e permanent injunction and permanent damages because it would be double reco)ery b<c of the future harm element they are correcting and compensating for' o Proof of imminent harm is e)idence that legal remedy is inade/uate (damages would be the legal remedy% o ?ere, damages awarded in pri)ate nonpermanent nuisance as loss of use (rental )alue% which yields >ero in this case' This is not always the case, i.e., rental value, there are more remedies available for private nuisance. Remedies$ Measured by( o Diminution in )alue of property caused by the nuisance (pre tort )' post tort% o Cost business profits (not here% o Puniti)es (think about it with an intentional tort-must show clear and con)incing e)idence of actual malice%' -n.unction$ May just say abate the nuisance' o Balance the hardships "n)ironmental )s' "conomics

(1oomer %. Atlantic Cement Co.) t!is is a pri%ate nuisance case Where there is NO favora1le environmental &ur&ose? .ust 1alancin# economic interests0

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8hat measure of permanent damages( compensation for total economic loss to property( Suppose you are neighbor( you get settlement, then sell, can that party sueD !A' Damages paid are past, present, and future' Pre)ent double reco)ery - Bou need to separate the dust from other incon)eniences' Emotional Distress - can be taken into account in calculating damages in a nuisance case, which goes to use and enjoyment of property' -nverse condemnation( not taking the property, but reducing its )alue' Eminent domain( 0he Io)ernment uses your property for a public use and compensate you for the fair market )alue of the property they took'

WA4S "O PROAE LEGAL REMED4 -NADEH5A"E 60 -rre&ara1le harm Multi&licit' of la suits -nsolvenc' of defendant (Goulding %. Coo;) Where dama#es ouldnIt 1e a #ood remed' for Plaintiff 1ecause he doesnIt ant mone' +njunction "jectment plus mesne profits may work' Easements of necessit' can only be granted in )ery limited circumstances of reasonable or absolute necessity' +f a court were to deny an injunction against trespass on the premise that some wider rule of easements of necessity obtains, we would not hesitate to o)erturn that e*ercise of discretion' Good Faith -m&rover M Someone who by mistakes makes impro)ements on anothers property' +n this case, the guy did it intentionally so this doctrine is not applicable' %ER%LA$ %larit' or %haos (1oeing Compan# %. Aetna) violation of federal statute (&;*&6() providing for response costs; this case centered around whether insurance co. had to reimburse business for response costs based upon whether they are considered damages or restitution ' Res&onse %osts$ cleanup of waste sites Cabels apply to cost of cleanup in the to*ic waste areaD o $estitution or o Damages' (0hey are mutually e*clusi)e%' 6ltimately court decides that damages included cost of cleanup so its co)ered by the policies' +f calling restitution e/uitable and damages legal is not a strong argument to say cost of cleanup is restitution, what is the best argument for calling cost of cleanup restitutionD

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%ha&ter ; ( SALES AGREEMEN"S o 0he remedies for torts are larger than breach of . o 0he SAC is longer for contracts then torts' $ecession put parties in position they were in before .1 unra)els the contract Specific perform J damages put parties in position as if . had been performed 7an get nominal damages for breach of .1 no puniti)es, but can get prejudgment interest (so long as damages are li/uidated%

"hree ma.or 1reach of ! remedies$ SS+f there is a breach of . /uestion on the e*am, all three remedies should be discussed' 60 Rescission !ot an option unless breach is material 7an only get rescission from a fraud in the inducement of a contract, which is a tort' Ioal of rescission( put parties in pre-contract position1 relate restitution( each must get back what they ha)e put into the contract, like getting back a down payment or returning the good' 7onse/uentials - +n addition to rescission, you are also entitled to conse/uentials, based on the $"C+A!7" interest( e*penses paid in preparation for the . which do not necessarily benefit the other party Cimited by foreseeability, general rule at time . is entered into' 70 S&ecific &erformance "/uitable remedy Ioal of SP( put party in position would ha)e been had . been performed( plus conse/uentials such as delay damages, or may be measured as lost profits' Must pro)e legal remedy is inade/uate 80 Dama#es Cegal (damages are money e/ui)' of spec' performance% Always in form of money Aut of pocket (rare1 restitution plus conse/uential% )' benefit of bargain (majority1 fm) plus contract price plus conse/uential% Discuss damages first, and then Specific Performance because you must show legal remedy is inade/uate before getting e/uitable remedy' CenteC ,omes %. 1oag Note$ signing or performing of . specify in e*am when saying the parties e*ecuted a contract' Elements of S&ecific Performance S&ecific &erformance Process$ 60 -s there an ade,uate le#al remed'C

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Sub-issue( is it personal or real propertyD 8hyD 6ni/ueness is a way or pro)ing that a legal remedy is inade/uate' o $eal Property - uni/ue, so Specific Performance' o Personal Property - still ha)e to pro)e that damages is inade/uate' 0he buyer wants real property' 8hat does the seller wantD 0he full purchase price MA!"B1 70 Mutualit' of remediesC 7an both get the same remedyD Old Rule - +f !A - 0hen the rule is not satisfied, so under 7ommon Caw since both cannot get same remedy, it is not a)ailable to either one of them' Ne Rule - 0oday its based on M5"5AL-"4 OF OBL-GA"-ON ( Ane party can get Specific Performance e)en if the other cannot' Must be Discussed 0he Ald $ule Applies, !ew rule s a trend, discuss both under specific performance' Li,uidated Dama#es - 7an be seen as punishment if they are in e*cess of what the actual loss is' $ule of thumb for acceptable li/uidated damages is about &HL' E,uita1le %onversion - Ance contract for $eal Property is signed, title is split into legal and e/uitable title' 0he buyer after the signing has e/uitable title to land and legal title to money, the seller has the opposite1 complete title does not transfer until the deal is performed' !A0"( 0he uni/ueness prere/uisite is taken less seriously in Specific Performance for land than for goods' At common law, sale of property was uni/ue and could get specific performance (by calling the property here /uasi-realty, then specific performance was not automatically grantable% -n ! cases? al a's as3$ 8ho is the breaching partyD 8ho is the plaintiffD (at common law, a breaching party cannot sue1 now, the trend is it doesnt matter% B54ERIS DAMAGES FOR SELLERIS BREA%= "i&$ :raud in inducement if the issue is around the making, i'e', the misrepresentation takes place before the . is formed, talk about fraud in inducement1 if the issue is around a breach of an already e*isting ., then do breach of . analysis' FRA5D -N "=E -ND5%EMEN" (( .lements 60 Scienter knowledge of the falsity

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70 Material misrepresentation (goes to how big of a lie it was% of a material fact (goes to how important that fact was% 80 $easonable reliance 90 +njury (!o injury, no tort' But not actual malice, that related to puniti)es% Plaintiff has t o o&tions if Defrauded Disaffirmance( $escission Z $estitution Z 7onse/uentials (based on pro*imate cause% and Possibly puniti)es' Affirmance$ .eep . and get damages( sounds like SP plus damages' 0wo ways( o 6se same terms as breach of ., but the ways of measuring are different( Out of Poc3et ( difference between . price and fm)1 (minority% Benefit Of the Bar#ain - difference between fair market )alue and )alue if as represented (majority%Scannot reco)er nominal damages bc need injury Remedies for fraud in the inducement$ o can disaffirm and get recission (:raud in inducement is only tort for which recission is a remedy% recission each must give bac! what they got in the transaction o 7an affirm and get damages either( &- out of pocket diff' Btw fm) J . price 2- benefit of the bargain (ma-ority rule and will generally yield the higher amount% diff btw fm) J )alue as represented BREA%= OF ! (( Remedies &- out of pocket return down payment 2- benefit of the bargain diff btw fm) J . price at the date of breach (majority% o 8hat is the difference between specific performance and damages( one is legal and the other is e/uitable E*&ectanc' Dama#es v0 Recission(Restitution (/orton v. '$*our!e) Measurin# the cost of im&rovements$ o 7ost o Additional )alue o +ncrease rental income possibilities

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$emedy( SP1 its not an option because there is a lien on the property that cannot be remo)ed so, therefore, only damages are a)ailable( Benefit Af 0he Bargain 6sed the minority approach -- when the breach was in bad faith( +'"' they used out-of poc!et because the breach was not in bad faith' +n the absence of bad faith the damages reco)erable for breach by the )endor of an e*ecutory . to con)ey title to real estate are the &urchase mone' &aid 1' the &urchaser to#ether ith interest and the e*&enses of investi#atin# title ' Doctrine of good faith impro)er impro)e anothers land by mistake (usually arises in boundary line issues, but could ha)e mentioned it here and would get credit on e*am for it%

Measurin# the Bu'erIs E*&ectanc' %ilson v. /ays breach of oral . after part performance 7AA( breach of .1 remedy is damages' Because the goal is to put the party in the place he would ha)e been in had the . been performed, the court awarded a benefit of the bargain measure' TeCpar .nerg# %. -urp!# Oil' USA' /nc. 7AA( breach of .1 remedy1 damages' 0he measure of damages for non-deli)ery or repudiation by the seller is the difference between the market price at the time when the buyer learned of the breach and the . price' 9ol$ %. Co!en breach of land sale .' three possible remedies are( &' Specific performance 2' Damages 3' $escission Note$ 8hen you see a breach of . case, think of damages, rescission, specific performance as remedies' Damages J Specific Performance put the parties in position had the . been performed<e*pectation interest (rescission is to restore pre-. status<to unra)el the deal% Doctrine of Economic Waste( applies only to instances of una)oidable harm that the builder had reason to foresee and it applies to commercial buildings, not residential dwellings' Moreo)er, here the builders breach was willful' 8illfulness can e*pand and effect a remedy' Cimitations on damages in breach of .' "his is ron#0 Fla0 Su&reme %t 2 a&&lies e,uall' to 1oth commercial and residential Olo$$son %. Coomer anticipatory repudiation of a sales .' 0he non-breaching party can %over$ to pro)ide substitute source for goods' A form of mitigation of damages or can wait performance for a Ecommercially reasonable time'F Breach of Warrant'

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General Dama#es$ difference btw )alue of goods recei)ed and )alue as warranted %onse,uential dama#es$ &% &rimar' &rofits are the diff btw what the buyer would ha)e earned from reselling the goods in /uestion had there been no breach and what was earned after the breach occured 2% secondar' &rofits any profits you would ha)e made in addition to the sale of the primary goods (i'e', buyers of mini mart goods not coming in to buy because they no longer are buying their gas in a certain place% 3% loss of #ood ill &rofits this is damages reco)erable if within the contemplation of the parties when the . was entered into the contract and only relates to future sales' Reason to 3no test( which re/uires that if a seller knows of a buyers general or particular re/uirements and needs, that seller is liable for the resulting conse/uential damages whether or not that seller contemplated or agreed to such damages' 0his is the issue of whether the damages were reasonably foreseeable at the time the agreement was entered into' Measure of dama#es for 1reach of arrant'( the measure of damages for breach of warranty (similar to fraud in inducement damages and generally, tort damages% is the difference at the time and place of acceptance between the value of the goods accepted and the value they would have had if that had been as warranted, unless special circumstances show pro"imate damages of a different amount. Reliance Recover' %art3man v. /ightower #roductions, 6td.( Breach of . case and negligence (most malpractice cases are analy>ed as negligence cases% Reliance -nterest( amounts e*pended in preparation and performance of a . ( a synonym is out of pocket measure of damages that dont benefit the other party (as opposed to restitution interest which is like a down payment%' 0hus, where the breach has pre)ented an anticipated gain and made proof of loss difficult to ascertain, the injured party has a right to damages based upon his reliance interest, including e*penditures made in preparation for performance, or in performance, less any loss that the party in breach can pro)e with reasonable certainty the injured party would ha)e suffered had the . been performed' -m&ortant$ 8hile ordinarily lost profits due to breach of . are reco)erable, when loss business profits are too speculati)e, that is your hint to think about reliance interest reco)ery' SellerIs Remedies Dama#es? Dama#es ((brams v. 7otter) the remedies available were specific performance, damages or rescission (5ote to get rescission, have to prove a material breach)

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Loss of Bar#ain Dama#es( 0he e*cess of the contract price o)er the )alue of the real property to the seller at the date of breach' o EDespite the rule that damages are measured by comparing the cash )alue of the contract to the cash fair market )alue at the time of the breach, if the land increases in )alue before trial and the seller resells the property for more than the contract price, the seller no longer has any loss of bargain damages' S'non'ms for Reliance interest out of pocket or conse/uential damages, restitution Miti#ation - 7ourts ha)e insisted that the seller EmitigateF damages by diligently and promptly seeking to resell the property'F o +f seller resells the property at a loss, the resale price is e)idence of the market )alue at the time of breach' Pre(.ud#ment interest - 7ompensates plaintiff for loss of use of money from date of breach to date of -udgment' o More likely to reco)er pre-judgment interest in . case' +n the case abo)e, howe)er, it was disallowed because the amount owed was not known or li/uidated at the time of breach (because if damages are unfi*ed at the date of breach they are unfi*ed at the time of suit so PO+ cannot be calculated from the date of the breach%' %onse,uential dama#es 60 +nterest on net proceeds is associated with Specific Performance, i'e', only reco)erable when you seek specific performance' 70 $esale e*penses occasioned by the breach(

Manufacturin# cases$ ho

dama#es are measured$ 60 Difference 1t the ! &rice and mar3et &rice at time of the 1reach ) hich is a 1enefit of the 1ar#ain measure of 1reach of !+ 70 Difference 1t cost of manufacturin# and the ! &rice 80 Or Nominal dama#es? onl' Manufactured Goods - :or a breach of contract for the sale of personal chattels, yet to be manufactured, the )endor is entitled to reco)er the difference between the selling price and the market )alue at the time and place of deli)ery' 0he court treats the mfr as if retailer, no deduction for e*penses sa)ed' S&ecific Performance argument( no uni/ue product and damages are ade/uate' Whenever Seller is manufacturer of &roduct - 7ost sa)ed if the product is not manufactured' Shouldnt this be subtracted from the reco)eryD Seller says no, + want the lost product' Buyer says, but you ne)er e)en manufactured this' +t would be a windfall' RESALE OF GOODS B4 SELLER (( -c-illan %. -euser -aterial and .quipment Co. @ 1reac! o$ <G remedies damages t!is case adds t!e resale issue ((elo)) Aptions are open to the non breaching seller( 60 $escission
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70 Specific Performance 80 Damages R5LE$ 8here the resale is made in #ood faith and in a commerciall' reasona1le manner the seller may reco)er the difference between the resale price and the contract price together with any incidental damages allowed under the pro)isions of article 2-5&H but less e*penses sa)ed in conse/uence of buyers breach' (the diff btw contract price and the fm) at time of breach was used in this case because the seller did not resell in a commercially reasonable manner% Reasona1le time depends upon the nature of the goods, the conditions of the market and the other circumstances of the case' Resale in #eneral ( 0his rule is based on the &rinci&le of avoida1le conse,uences' 0he defaulting buyer should be credited with the price actually obtained or obtainable for these goods by a new sale' o 0he seller is not accountable to the buyer for any profit made on resale' Sprague %. Sumitoto ?orestr# Compan#' 0td. must give notice of intention to resell under the 9&& to give the breach party opportunity to remedy breach this is an element of the seller right to invo!e resale remedies 5%% distin#uishes incidental dama#es from conse,uential dama#es$ 3no this difference for e*am &ur&oses o -ncidental dama#es are normally incurred when a buyer (or seller% repudiates the . and wrongfully rejects the goods, causing the other to incur such e*penses as transporting, storing, or reselling the goods' o %onse,uential dama#es do not arise within the scope of the immediate buyer-seller transaction but rather stem from losses incurred by the nonbreaching party in its dealings, often with third parties, which were a pro*imate result of the breach' No %onse,uential Dama#es for Seller under the 50%0%0 Puzzle of the SellerIs Profits(*.;. +avis &hemical &orporation v. +iasonics) here, the breaching party is the plaintiff (at common law, couldn$t do this) Lost Aolume Seller 2 sold as much as it &roduced therefore lost a &rofit from the ori#inal sale i0e0? 'ou can sell as much as 'ou can ma3e0 Breaching party is bringing the claim, asking for restitution of its down payment' .P - $P yields H, no damages, i'e', because the seller sold the goods' +f the seller would ha)e made the sale represented by the resale whether or not the breach occurred, damages measured by the difference between the . price and market price cannot put the lost )olume seller in as good a position as it would ha)e been in had the buyer performed 0he resale would ha)e been made whether the buyer breached or not, so + should still be allowed to reco)er my lost profit' Seller must convince court$ 60 "he' are a Lost Aolume Seller 70 "he' ould have made the sale
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Stephanie Burke

80 -t

ould have 1een economicall' &rofita1le to do so0

BREA%= OF ! REA-EW $escission re/uires a material breach, e'g', 7onstruction contract NHL performed is a material breach this constitutes substantial performance (rescission is not an option for a buyer after substantial performance by the contractor% @uantum Meruit is associated with rescission getting out of a . ( limited by rate8price@) Losin# ! 2 here full &erformance e*ceeds the ! &rice Li,uidated Dama#es %lauses(,ohe v. *oblyn +evelopment &orp.) Li,uidated dama#es$ is an amount fi*ing damages' :or a li/uidated damage clause to be )alid, it must be the following two re/uirements( &% At the time the . is formed, it is )irtually impossible to estimate the amount of damages in the e)ent of breach1 and 2% the amount of actual damages bears a reasonable relationship to the amount in the li/uidated damages clause' +t must be reasonable o A term fi*ing unreasonably large li/uidated damages is unenforceable on grounds of public policy as a penalty'F i'e', it )astly e*ceeds actual damages' o 0he law disfa)ors li/uidated damage clauses' 0he law fa)ors that the breaching party pay e*actly the amount of damages that the P suffered o +f the clause is struck from the . (as in)alid%, then the P must pro)e actual damages' o An estimate of damages which was reasonable when made may sometimes turn out to be a gross e*aggeration' o When is validit' )reasona1leness+ of a li,uidated ! measuredC - 8hen 7ontract is signed, i'e', when the . was entered into' ?owe)er, the modern rule is toward assessing reasonableness either at the time of . formation or at the time of the breach the modern trend, may e)en be the majority rule at this point' Because an estimate of damages which was reasonable when made may sometimes turn out to be a gross e*aggeration' More recent cases display a willingness to take this factor into account and to refuse enforcement of the forfeiture if it would result in a large windfall to the )endor in fact' o Benefits to the seller that are attributable to a rising market subse/uent to breach rightfully accrue to the seller' o A seller who has suffered no harm cannot retain a deposit e)en in the face of a li/uidated damages clause' o Ci/' Damages clauses tend to fa)or sellers of property SellerIs Restitution (%ellston &oal v. <ran!lin #aper &o.)Aseller sought rescission and restitution in quantum meruit
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Buyer honors . while getting better part of the deal, then breaches when it goes the other way' $emedy is rescission' E8hen full performance of a . has been pre)ented by the wrongful act of the D, the P has the right either to sue for damages, or he may disregard the ., and sue as upon a /uantum meruit for what he has performedF 0he real test in all cases of a Ps right to reco)er as upon a /uantum meruit for part performance of a ., wrongfully terminated by the D, depends upon the consideration whether the D is thereby enriched at the loss and e*pense of the P' $escission is the best remedy in a breach of . when full performance e*ceeds the . Q here, it was not a losing .'

-ssue$ +s @M limited by the . price when P is the non-breaching partyD !o' 0hus, the court here did not use the . price too limit @M' U.S. %. Algeron 1lair' /nc. Ieneral contractor breaches after subcontractor partially performs (2H percent% and Subcontractor would ha)e lost money had it completed the .' +f I7 had not breached, and S7 fully performed, it would ha)e been a losing contract $emedy( $escission -- restitution in the form of @M' BThe impact of quantum meruit is to allow a promisee to recover the value of services he gave to the + irrespective of whether he would have lost money on the and been unable to recover in a suit on the . T!e measure o$ reco%er# $or F- is t!e reasona(le %alue o$ t!e per$ormanceG and reco%er# is undiminis!ed (# an# loss )!ic! )ould !a%e (een incurred (# complete per$ormance. %hile the price may be evidence of reasonable value of the services, it does not measure the value of the performance or limit recovery. *ather, the standard for measuring the reasonable value of the services rendered is the amount for which such services could have been purchased from one in the #$s position at the time and place the services were rendered.1 "R5S" LAW "*press( can be written and oral +mplied( can be in fact (resulting trust% or in law (constructi)e trust% (also called @uasi-.% A constructi)e trust can be imposed o)er money, real property and personal property (just not people% Because it arises by operation of law, rather than being dependent upon the intention of the parties, Statute o$ $rauds is not a de$ense to a constructi%e trust (only to an e*press one or one implied in fact% !o longer need to establish a fiduciary relationship

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S&ecific Performance Revisted (1ander %. Grossman) breach of to purchase a rare sports car issue) specific performance of a for the sale of unique goods with a fluctuating price (similar to stock case, earlier% specific performance may be decreed where the goods are uni/ue or in other proper circumstances P re/uested Monetary Specific Performance in the form of a judgment appro*imately &H times greater than the breach of . damages awarded by the jury' 0he car was sold prior to the commencement of the litigation for a price T&M;HHH abo)e the T9HHHH . price, and P re/uested that he be granted SP in the form of a constructi)e trust impressed upon the proceeds of the sale, plus interest from the date of the sale' Strictly speaking not SP case because hes not getting the car, hes getting money, so its more like damages' ' MEAS5RE OF DAMAGES$ -f e,uita1le mone' dama#es are to 1e a arded 0 0 0 that a ard must 1e 1ased u&on value at the time of trial? rather than on an earlier valuation0G Point is to put the claiming party in the same position he would ha)e been in had the . been performed' +t is specific performance because he has the money to buy that car today (otherwise, this case doesnt really look like specific performance%

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%ha&ter / 2 EMPLO4MEN" AGREEMEN"S )%ON"RA%"S+ Rescission? dama#es? s&ecific &erformance )and dama#es are the &rimar' remed'+ for 1reach of em&lo'ment !s %anIt force &eo&le to or3 a#ainst their ill )68 th Amendment+ Ieneral 7C rule employment agreements are A0 8+CC1 therefore, either party can terminate without legal liability' !ot e)ery employment agreement creates a fiduciary duty or an agency relationship' !egati)e injunctions (orders that say you cant work for some one else, e'g'% and co)enants not to compete( under SP because in a way its the only remedy besides reinstatement that is close to SP' !ominal damages is a possibility for breach of .' Measure of damages( cost to replace, lost profits, li/uidated damages, nominal, etc' !o cause needed to fire an at-will employee, 7ause is needed if there is a contract $escission in employment conte*ts employees must be paid periodically (by statute% therefore there is not much to be gained i'e', rescission does )irtually nothing for either party rarely used Specific Performance think automatically of the &3 th amendment which forbids in)oluntary ser)itude1 cant force someone to continue to work Duty to mitigate damages( for an employer, to hire someone else

FOR EMPLO4MEN" %ON"RA%"S? AS! 8ho is the breaching party employer or employeeD (remedies are different depending upon who breached% $are for employer to sue1 more common for employee to sue employers who fire them' +e%ie)$ For %ontracts? dama#es can 1e measured 1' &' Difference between . rate and fm) at time of breach 2' !ominals 3' Cost business profits 9' $estitution Em&lo'erIs Remedies Em&lo'erIs Dama#es(*oth v. 5pec!) What remedies are availa1le to the non(1reachin# em&lo'erC 7ost of obtaining e/ui)alent ser)ices in the marketplace =o are dama#es measuredC 0he best way to measure this is by how much the breaching employee is making elsewhere this sounds like restitution because it is measured by the Ds unjust enrichment (this is similar to rental )alue in that the measure being usedDD%

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S&ecific Performance ( is not an option, court will not order employee to go back to work ()iolates constitution &3th Amendment in)oluntary ser)itude Black Cetter Caw%' Rescission ( is an option, although not an attracti)e one' All you need is a material breach, and this breach is material' !ot attracti)e because employee was paid and ser)ed competently, so there is nothing for employer to get out of it' Dama#es ( 8hat is measure of damages in breach of employment . by employeeD o %ost to re&lace - 8hat did it cost employer to replace breaching employeeD o Lost &rofits 7an be too speculati)e' o Restitution - Based on how much the defendant profited from his new job' o 5n.ust Enrichment - 0he best measure of Ps loss is sometimes Ds unjust enrichment

Em&lo'erIs Restitution(5nepp v. 9nited 5tates) Promised not to di)ulge classified information and not to publish any information without prepublication clearance' Published without prior appro)al' 0he employer is suing the employee for breach of promise not to publish' Breach of .' 0he S70 upheld use of a constructi)e trust (e)en though it appears that the legal remedy would ha)e been ade/uate here, i'e', puniti)e damages courts are not so strict with re/uiring a showing of the inade/uacy of legal remedies, unless it is an injunction or specific performance here, they ha)e maintain the strictness%' Remedies( o -n.unction as to future &u1lications (prohibit future publications, but this raises &st amendment issues around prior restraint% o %onstructive trust on all profits employee earns from the publication no longer need breach of fiduciary relationship to impose a constructi)e trust o Nominal and &unitive dama#esJ Em&lo'erIs -n.unctive Relief(0everly ?lan 7usic, .nc. v. %arner &ommunications) 8hen an employee breaches . to take another job can they sue the new employer for inducing the breachD Plaintiff cannot enjoin prospecti)e employers of the breaching employee from working for them' 0his depri)es the employee from his<her li)elihood "mployer sought a negati)e injunction to keep Baker from working for 8arner' +n 7alifornia, by statute, courts cannot enjoin the breach of a personal ser)ice . unless the ser)ice is uni/ue in nature and the performer is guaranteed annual compensation of at least T=.' But, damages are still an option for the employer by suing in tort 8arner for interference with a contractual relationship Em&lo'erIs Li,uidated Dama#es(:anderbilt 9niversity v. +inaro) Ci/uidated Damages clauses in employment agreements are generally disfa)ored' But, a li/uidated damages clause in an employment agreement will be held )alid i$ t!e amount stipulated is reasona(le in relation to t!e amount o$ damages t!at

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could (e eCpected to result $rom t!e (reac!' and t!at suc! damages )ould (e indeterminate or di$$icult to pin do)n (measured when breach occurred% same as in a sales .' 8hen do you measure reasonablenessD Modern )iew is to measure at either point Another issue( when calculating employers injuries, could they take into account conse/uentialsD court says yes, e)en though some may seem to be speculati)e, how much good will was lost, etc' +n the area of employment, lots of confusion about what form remedies take, are they damages or restitution, they o)erlap a lot, also /uasi contract comes into play' 0here are only a few basics to focus on, know what each one does (damages Ps loss, etc'%, you cant go wrong'

Em&lo'eeIs Remedies Em&lo'ees Remedies and Re(instatement(+i"ie ?lass v. #ollac!) Where an em&lo'er ron#full' 1reaches a contract of em&lo'ment &rior to the time it has 1een com&letel' &erformed? a cause of action for damages for breach of contract immediately arises in fa)or of the employee and he is entitled, if he elects, to reco)er his damages for the full term for which he was employed and he is not limited to damages pro)en only to the date of trial where trial is before the e*piration of the term of employment'F POSS-BLE REMED-ES( Dama#es in 1reach of em&lo'ment ! settin# 2 measure hen em&lo'er 1reaches$ 1alance of contract a#es less a#es earned or should have earned in re&lacement .o10 Rescission( not a good option because it would entail restitution, gi)ing back what is gi)en thus far, but this employee has already been paid for time worked, so not much left for restitution although it is also restitution plus conse/uential damages<reliance interest, did this employee sustain any damage on account of employers breach' And S&ecific Performance( &3th A will not permit it' Dut' to Miti#ate$ the duty is on the employee to use reasonable diligence to obtain other employment and thus minimi>e his damage' 7onsider facts like o Age o Probable life e*pectancy o "ducation o "*perience o Past earning capacity o Probable span of employability' Em&lo'eeIs Avoida1le %onse,uences

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Miti#ation of Dama#es$ subtract new job salary from old job salary' %ommon La %laims$ &- wrongful discharge in )iolation of public policy 2- breach of implied in-fact contract 3- +mplied co)enant of good faith and fair dealing

Rescission Based On$ &- "ort( fraud (conse/uentials are limited by Pro* 7ause% 2- %ontract( failure of consideration (7onse/' limited by foreseeability% 3- Neither tort nor !$ mistake, innocent misrepresentation (not entitled to conse/uentials% Huantum Meruit( can be implied in fact or implied in law sometimes limited by . rate, sometimes not' +t is limited when the P is the breaching party (otherwise you create incenti)e for indi)iduals in a losing . to get out of the . and sue%' 0hus, @M is limited( When non(1reachin# &art' is &laintiff When non(1reachin# &art' is an attorne' Par;er %. 23t! Centur# ?oC @ .mplo#eeBs a%oida(le consequences 7AA( breach of .1 remedy damages' "he General Rule is that the measure of reco)ery by a wrongfully discharged employee( +s the amount of salary agreed upon for the period of ser)ice, less the amount which the employer affirmati)ely pro)es the employee has earned or with reasonable effort might ha)e earned from other employment' -s there a dut' to miti#ateC !o, the employees rejection of other a)ailable employment of a different or inferior kind may not be resorted to in order to mitigate damages' 0hus, the employer must show that the other employment was comparable, or substantially similar to that of which the employee has been depri)ed' Who has 1urden of &roof on dama#e miti#ationC 0he employer' For e*am ould also ant to mention these other &ossi1le remedies$ S&ecific Performance( ($emember to go to damages first, because legal remedy must be inade/uate%1 is it a uni/ue type contractD Rescission( Ienerally speaking, no restitution, but maybe reliance, if she ga)e up other films to do this one' 8hats the test for whether this is reco)erableD 8as it :A$"S""ABC"' Dama#es( general damages' %ontract v0 "ort -nterlude$ E*ce&tions to the At(Will Doctrine (<oley v. .nteractive +ata &orporation)

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Note 8hen suing for breach as an employee for being fired, essentially, the only remedy is damages, reinstatement is not an option (reinstatement is like specific performance% 60 Wron#ful dischar#e in violation of &u1lic &olic'$ is it tort or contractC "ort 8hat public policy is being argued( 0his is the banking business, so the public has an interest in knowing if the bank has knowingly employed an embe>>ler' +n this case, the plaintiff lost on this claim because no public interest is implicated' 70 -m&lied in fact contract An implied in fact contract is based upon conduct of the parties' +ts a contract claim' o Any implied in fact contract claim is based on the conduct of the parties, based upon representations of job security and termination procedures, e'g', those contained in company handbook' Em&lo'ee =and1oo3 - 8hat are legal hurdles of using the employee handbook as the basis of a lawsuitD o +s it binding, what consideration did the employee gi)eD o 8hen was it shown to the employeeD +f done at initial hiring, there was more likelihood that the employee relied on it' 80 -m&lied covenant of #ood faith and fair dealin# ' 0ort <contract +n insurance, analy>ed as torts' 7ompare employment .s to insurance .s to see if this should be a tort' Doesnt work' +nsurance .s can be distinguished' +nterests of insurer and insured are at odds' "mployer and employee are in alignment' " J " ha)e mutual interest in performance on the job' +f analy>ed as a ., then it limits employers liability because there is no possibility for puniti)es' 0his case said it was a T!is coa is a contract )!en raised in t!e emplo#ment setting and anal#"ed as a <' not a tort. ?urt!er' t!is claim is not (arred (# t!e SO?. Tal; a(out t!ese t!ree common la) claims )!en an at&)ill emplo#ee !as (een $ired( wrongful discharge in )iolation of public policy, breach of implied in fact ., and implied co)enant of good faith and fair dealing Em&lo'eeIs Restitution &hambliss 0ahner 4 &rawford v. 6uther 7lient has the power and the right at any time to discharge his attorney with our without cause' Such a discharge does not constitute a breach of . for the reason that it is a basic term of the contract, implied by law into it by reason HM is e,uivalent of rescissionCC Rule of "hum1( when the . is not a profitable one (i'e', the attorney has billed more hours than the . would allow%, it is better to essentially rescind the . and sue in /uantum meruit (since billable hours * hourly rate e*ceeds the . amount%' Public policy, howe)er, car)es out an e*ception in the case of a client firing her attorney( @M is limited to the . amount any other rule creates incenti)es for attorneys to get themsel)es fired after they ha)e billed more hours than the . allows'

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*unyan v. #acific (ir .ndustries @ $irst case )!ere rescission is t!e remed# @ *escission$s aim is to put the parties in pre- position and always associate restitution with rescission (giving bac! what each party has ta!en so far). # was also as!ing for consequential damages . -MPOR"AN" R5LE$ =o are conse,uentials measured hen P see3s rescission 1ased in turn on &' :raud (limited by pro*imate cause% 2' Breach of . (limited by foreseeability% 3' Mistake <innocent misrepresentation (no conse/uentials% 0he logic behind this is because fraud has a high le)el of culpability1 breach of . is midle)el1 mistake is low-le)el of culpability S&ecific Performance( unlikely in a personal ser)ices contract' But this is not clearly one, this is franchisee<franchisor so not technically employment' 8ould need to ask these /uestions( would a lot of court super)ision be re/uiredD 0he only tort for which rescission is an option is fraud' 7ourt says this is not a fraud case because the employer had good faith to carry through on its contractual obligations, but could not do so' Distin#uish fraud from 1reach of !( +f you lie before entering ., its probably fraud1 if you intend e)erything you say up to the time of the ., its just a breach' Cegal )' e/uitable rescission( 0he word rescission used alone on e*am means e/uitable rescission1 we are not dealing with legal rescission'

6ynn v. 5eby -- /ere breaching party was the #. The only remedy a breaching party can get is restitution. R5LE( 0hough at common law, a breaching party could not sue for any relief, the emerging trend is that a breaching party is entitled to reco)er restitution which is measured as t!e eCcess to (ene$it con$erred o%er inDuries sustained. Em&lo'eeIs Remedies$ Reca& (<reund v. %ashington 5quare #ress) General formula for measurin# 1reach of contract dama#es0 Benefit of the 1ar#ain$ !P ( FMA at the time of the 1reach$ !A0"( 8hen damages fail for uncertainty, the remedy will be nominal damages' #oid, )oidable, unenforceable . and the impact of these on rescission - restitution' Election of remedies Means you cant get more than one remedy1 o But( Dama#es and in.unction )&ast < future+0 But if damages are P"$MA!"!0 , its past present and future and no injunction in that case' o Fraud -, )ictim has choice( Stick with . and sue for damages, or Disaffirm and seek rescission and e)erything that goes with it' o When can an election of R ta3e &laceC 7ant happen before . is entered into1 there must be a signed . and then something goes wrong' Ance )ictim

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disco)ers fraud, how long until the election of remedies (affirmance < disaffirmance% is made1 can it happen before suitD Bes, it can be manifest by conduct, does not ha)e to be by words, written or oral' "*' Proceed with transaction )ersus get out of transaction, but this is after disco)ery of the fraud' o -s there al a's election of remediesC !o o %an &leadin# in alternative serve as election of remediesC o Proba+bly not, e)en if one count says damages another SP and a third rescission' !ot generally bound by the election in the first count' Latest &ossi1le time for election of remedies( submission to the jury' !o rule about when in time election should take place' (?annett v. *egister #ublishing) Fraudulent -nducement ( One fraudulentl' induced into a contract ma'? as a matter of su1stantive la ? either affirm or disaffirm the a#reement0 o An election of the su1stantive ri#ht to affirm e*tin#uishes the su1stantive ri#ht to disaffirm0 o And so an attempt to in)oke the remedy of rescission after an action on the contract may fail, not because of election of inconsistent remedies, but because the plaintiff no longer has the substanti)e right to disaffirm' o "*ercise of acts of ownership o)er the subject matter of the . will )alidate the transaction and terminate the power of a)oidance, regardless of whether the other party has suffered any prejudice' o 0he duty of care of a defrauded party who continues to operate a business for the benefit of the other party after sending a timely rescission notice and tendering the property back is that of a gratuitous bailee' Measurin# fraud dama#es$ o Aut of pocket( difference between :M# and .P o Benefit of the 1ar#ain$ Difference between :M# and )alue property would ha)e had had it been as represented' o Possibly puniti)es o Possibly conse/uentials - limited by pro*imate cause'

;arl v. 5a!s 4 &o. Fraud$ o Material misrepresentation of a material fact o Scienter o +nducement o $easonable reliance o +njury' -ssue$ does injury for fraud ha)e to be pecuniaryD !ot necessarily' /arper v. (damet3 A real estate agent failed to disclose an offer from a purchaser for an M3 acre farm' Broker takes buyer to show him the land' Buyer made T5HHH offer for the M3 acres1
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broker said seller did not accept but in fact broker ne)er made the offer1 second lie broker told buyer he could buy &5 acre parcel for T=,HHH' *eed v. ing :raud in the inducement and not breach of . after signing o Misrepresentations took place before the . was signed' Difference is important because it affects remedies1 options to )ictim of fraud, rescind or affirm' o +n fraud you must choose between rescission and damages' Generally speaking, if a bo$ to get out of it !as been fully performed, "an#t use any of t!ese t!ings in t!e

But? these are all defenses to contract &erformance )s&ecific &erformance+ Duress 5ndue -nfluence Mista3e or 5nconsciona1ilit'

((not torts )lo level of ron#doin#+ ((all can 1e used as a reason to #et out of a ! )i0e0? defenses to s&ecific &erformance+ Defenses to s&ecific &erformance (statute of frauds (minor status 5nconsciona1ilit' )serves as a defense to s&ecific &erformance+ "hree t'&es$ )need 7 of these 8 to &revail+ 60 &rocedural- (sharp tactics used to procure the k% looks at the kind of tactics applied to induce you to enter into . (e'g', duress, undue influence, etc'% 70 su1stantive (most common% (unfair terms in the . itself% looks at the terms of the . are they so e*treme one sided e'g' car on an installment plan where the interest rate is so high it is illegal 80 remedial ways in which the other party to . tries to enforce the ., e'g', the creditor calls your employer after you are behind on payments or trigger garnishment proceedings' Ieneral rule is need at least two of the three types of unconscionability to assert it' +t is not a tort, but a defense to specific performance1 full performance makes this argument una)ailable' ( not recission 1<c he alread' sold the &ro&ert' 2 canIt #et out of it "hree o&tions o&en to court$ 60 void the entire ! 70 e*cise unconsciona1le &art )enforce the remainder ithout unconsciona1le term+ 80 re rite the ! )limit the a&&lication of the unconsciona1le term to avoid unconsciona1le results+

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Srewriting does not reflect the intent of the parties, only to make the . fair' As opposed to reformation which is a rewriting in accord with intent of parties' )SoF+ . has to be in writing when( $eal property . not performed w<in a yr Sale of goods worth more than T;HH D5RESS 'diri33i v. 0loomfield 5chool +istrict case where teacher resigns after being charged with homose"ual activity. /e tries to rescind his resignation on the basis of duress, undue influence, mista!e and fraud &ases in undue influence occur where there is a ., one party doesnt perform, non breaching party sues, breaching party uses it as a defense (along with fraud, mistake, innocent misrepresentation%' Duress must be an illegal action or threat in duress or menace, consists in unlawful confinement of anothers person, or relati)es or property, which causes him to consent to a transaction' A threat to take legal action is not unlawful unless the party making the threat knows of the falsity of his claim' Mistake 0he parties must be laboring under a misapprehension of law or fact (Both parties must ha)e all material facts for a party to claim no mistake%' 6ndue influence( see below -- =ere? used undue influence as a defense to s&ecific &erformance :raud see elements above o 7onstructi)e fraud( 7onstructi)e fraud arises on a breach of duty by one in a confidential or fiduciary relationship to another which induces justifiable reliance by the latter to his prejudice' ?ere, need the fiduciary relationship' 5ndue influence ( &ushin# someoneIs 1uttons hen under stress0 Dis&arit' in &o er "a3in# unfair advanta#e of someoneIs ea3ness of mind Not a tort? therefore canIt #et dama#es

5ND5E -NFL5EN%E 6( Lessened ca&acit' of the o1.ect to ma3e a free contract 7( A&&lication of e*cessive stren#th 1' a dominant su1.ect a#ainst a servient o1.ect 8( Over &ersuasion ) hich is #enerall' accom&anied 1' certain characteristics includin#$ o Discussion of transaction at ina&&ro&riate time o %onsummation in an unusual &lace o -nsistent demand to finish at once o E*treme em&hasis on unto ard conse,uences of dela'

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o 5se of multi&le &ersuaders 1' dominant side a#ainst a sin#le &art'0 o A1sence of third &art' advisers to the servient &art' o Statements that there is not time to consult an attorne'0 60 Nma3in# of ill is a t'&ical? classic e*am&le of undue influence )elderl' &erson and someone close to the elderl' &erson ho has that confidential relationshi& ith them? and &revails u&on them to chan#e their ill+ D5RESS 2 B5S-NESS %OMP5LS-ON 5elmer &o. v. 0la!leslee 7idwest -- Selmer was sub. for Blakeslee' $aising a defense to the performance of the settlement agreement1 the defense is Eeconomic duressF o 0he mere stress of business conditions will not constitute duress where the D was not responsible for the conditions o "conomic problems of P must be caused by the Defendant %ha&ter O cases are all attempts to enter into contracts, and then one party does not follow through' 0hen breaching party raises an affirmati)e defense or an e*cuse' 5N%ONS%-ONAB-L-"4 )&0 ;O6+ 2 this is an e,uita1le doctrine Su1stantive$ terms unconscionable, paying too much for an item, usually not enough by itself to unra)el a contract because . law says inade/uacy of consideration is not alone a basis for rescission' Procedural( kinds of tactics employed to induce you to buy, some forms of undue influence, pressure e*erted on buyer to enter into .' (But fraud is a bigger wrongdoing, so if fraud forget unconscionability Remedial$ how seller goes about collecting' o Also, if . is fully performed generally unconscionability is no defense( logical because if the . is completed it is hard to argue that it is an undue burden to perform' o 0he more the . is performed, the harder it is to get rescission' :oc!ner v. ;ric!son 0heoretically it is possible for a . to be oppressi)e taken as a whole, e)en though there is no weakness in the bargaining process and no single term which is in itself unconscionable' 6nconscionable contract in)ol)es other factors as well as an o)erall imbalance'

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5nconsciona1le %ontract$ "he &rinci&le is one of the &revention of o&&ression and unfair sur&rise and not of distur1ance of allocation of ris3s 1ecause of su&erior 1ar#ainin# &o er0 Factors( o 6nrepresented party, o Ane party has more e*perience o +ne/uality of knowledge Reformation of 6nconscionable 7ontracts- 0he unconscionable contract may be reformed to limit the unconscionable clause and then enforced as reformed'

o 5%%( o $eject part o $eject all, or o Cimit the unconscionable clause' .ill So !o) to discuss t!is on eCam o 7ause of action for breach, one party raises unconscionability as a defense, the other party tries to use laches to o)ercome the defense' Su1stantive 5nconciona1ilit' ( bad terms, the payment was too low' Procedural 5nconsciona1ilit'( undue influence, une/ual bargaining power' Reformation( radical, court substitutes its sense of justice for the intent of the parties' %ON"RA%" NO" FORMED (( $e/uired 8riting Missing (Sc!)eiter %. ,alse#) Rule( #endee under an agreement for the sale and purchase of property which does not satisfy the statute of frauds cannot reco)er payments made upon the purchase price if the )endor has not repudiated the contract but is ready, willing, and able to perform in accordance therewith, e)en though the . is not enforceable against the )endee either at law or in e/uity' (!o legal description of the property which is a key term%' o 0his is another case where the breaching party is the plaintiff (at common law, the only remedy a breaching party could seek was restitution% o "hus, in accord with the great weight of authority has consistently denied reco)ery of earnest money paid under a )oid or unenforceable agreement to con)ey real estate where the buyer has defaulted and the seller was at all times ready, able and willing to consummate the transaction' o %ourt held that Fto the de#ree the ! has 1een &erformed? it is enforcea1leG o 5nenforcea1le 2 the buyer does not get security deposit back o Aoid if . is )oid, you ha)e no legal basis to keep the security deposit o voida1le Lac3 of %a&acit' to %ontract (/albman v. 6em!e)

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7ontract with minor for )ehicle' +t threw a rod, taken to be repaired and left there, repairs made, mechanic then EunrepairedF it and took to minors home, tried to get seller to pick it up, the car was )andali>ed, now worthless' +t is settled law in this state that a . of a minor for items which are not necessities is )oid or )oidable at the minors option' As a #eneral rule a minor who dissafirms a contract is entitled to reco)er all consideration he has conferred incident to the transaction' +n return the minor is e*pected to restore as much of the consideration as, at the time of disaffirmance, remains in the minors possession' 0he minors right to disaffirm is not contingent upon the return of the property, howe)er, as disaffirmance is permitted e)en where such return cannot be made' Where there is misre&resentation 1' a minor or illful destruction of &ro&ert', the )endor may be able to reco)er damages in tort, but absent these factors, as in the present case, we belie)e that to re/uire a disaffirming minor to make restitution for diminished )alue is, in effect, to bind the minor to a part of the obligation which by law he is pri)ileged to a)oid' Aoida1le 1' minor 2 if returns as much consideration as he can +f depreciated, is the minor liable for depreciation - Bes, e)en in case of depreciation, and adult must gi)e back purchase price "*ceptions to minor rule &% lies about age 2% necessaries (minor liable for :M#, not .P% - 7CA0?"S, :AAD 3% +ntentional 0ort (find a tort? no need for 1reach+ -f for necessaries$ you can gi)e back what you got, but liable for :M# of property' Disaffirmance rather than rescission D Because only has to gi)e back what he has in his possession, e)en if )astly depreciated' 6nless( misrepresentation of age, fraud( separate tort' damaged the property( separate tort' +f minor had intentionally

G+OU5* ?O+ +.ST/TUT/O5 && DEF-%-EN" %ONS-DERA"-ON (Cohnson v. ?7& &hevrolet) Bad pickup' Problems from day one' 7ause of action( breach of contract' $e)ocation of acceptance( another was of saying rescission' 6nder 677 2-=HM( re)ocation must occur within a reasonable time when buyer disco)ers grounds for it' Bour conduct can show affirmance, then can no longer rescind' 0his didnt happen in this case because the conduct of keeping the truck was necessary' o 0he truck buyers owed a duty of reasonable care for the truck (as bailees% o ?ere, the court allowed for rescission of the . and reduced reco%er# (# reasona(le %alue o$ t!e use o$ t!e truc;' Measure can be either depreciation or usage' Depreciation would yield a larger amount to the truck dealer and mileage<usage lower' 0he degree of culpability of the parties

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would argue for a larger or lower measure when innocent, then the lower )alue (as in this case usage%' M-S"A!E $escission based upon mistake' Must be a mutual mistake of fact and failure of consideration' A state of mind not in accord with the facts' More likely get relief if mistake of fact rather than a mistake of law' %annot #et conse,uential dama#es 1ecause mista3e im&lies freedom from fault t o innocent &arties0 Ienerally, no relief for mistake of law (e*ception would be the law of another state% i'e', cannot be mistaken when you ha)e e)idence that there was a possibility of fraud (truc! case for insurance money) "'&es of Mista3e$ &- @uality or )alue mistake rescission is not permissible 2- Mistake that goes to the essence of a . bigger than material mistake rescission is possible' S7onsider risk of loss has one party assumed the risk of loss Eas isF clause suggests one party has' As is cause 2 the buyer agree to accept land as is' Accept it as is - cant disclaim fraud - if you can pro)e fraud, get out - co)ers mistake b<c low le)el Mista3e in inte#ration$ writing does not reflect a meetin# of the minds so the writing must be changed' !eed a meeting of the minds in order to get reformation changing the terms to meet the intent of the parties' +f there is a mutual mistake (both parties% Basic mistake goes to essence of bargain -supports rescission Reformation 2 mista3e in inte#ration - Mistake in +ntegration parties think they are entering a deed, and want rt of sur)i)orship, but think tenancy in common will gi)e it' 8riting says 0 in 7ommon' Mtg of Minds, jt' 0enancy - +f writing doesnt accurately reflect Mtg' Af minds, reformation will change to make it correct - Must show mtg' Af minds - Doesnt work if minds are conflicting Mistake must go to the essence of the bargain1 mutual mistake most likely to get relief +f essential purpose impossible, then Q

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SA: Minor 7ontracts 6nenforceable, )oidable and )oid .s -LLEGAL %ON"RA%"S 7ontracts can be rendered illegal based upon public policy 1o%ard %. American ,orse .nterprises 0he burden is on the defendant to show that its enforcement would be in )iolation of the settled public policy of this state or injurious to the morals of its people' Before labeling a contract as being contrary to public policy, courts must carefully in/uire into( &' the nature of the conduct, 2' the e*tent of public harm which may be in)ol)ed, and 3' the moral /uality of the conduct of the parties in light of the pre)ailing standards of the community' +f the court finds the . )iolates public policy, then it is an illegal contract' At that point, the court lea)es the parties to an illegal . where it finds them' EA promise or other term of an agreement is unenforceable on grounds of public policy if legislation pro)ides that it is unenforceable or the interest in its enforcement is clearly outweighed in the circumstances by a public policy against such terms'F +f one party is less at fault and seeks forgi)eness, or is a person to be protected by the law, then that party has a greater chance of getting relief, typically in the form of restitution' 8hat are 9 e/uitable remedies that are not restitutionaryD &- $eformation 2- +njunction 3- Specific performance 9- $escission 8hat are sources of Public PolicyD - statutes - court opinions (common law% - constitutions (federal and state% - administrati)e regulations - canons of professional responsibility Distinction 1et een unenforcea1le ! and void contracts$ 6nenforceable . reason cant enter into, but something makes it unenforceable #oid is )oid from the beginning no

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Note$ -lle#alit' is a defense to any legal remedy (can be used whether the remedy is e/uitable or legal%' 5nclean hands is a defense to an e/uitable remedy' +.+. %. -.,. Surrogacy contracts' ?ere, the surrogate mother used the defense of )iolation of public policy to a)oid specific performance of the .' 0hus, %iolation o$ pu(lic polic# used as a de$ense to speci$ic per$ormance ' 8hy do you ha)e to appeal to public policy if there is a statute that makes baby selling illegalD -n the face of an ille#al !? no relief for either &art'? neither s&ecific &erformance? rescission or dama#es? court leaves the &arties here it finds them0 +n the face of unclean hands the court also lea)es the parties where it finds them' Surrogacy amt paid for e*penses incurred in labor would be ok, if she still had 9 days after pregnancy )ia statute, and . cant be for selling babies

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