Remedies Outline

Overview
Determine the area of substantive law (may be more than one, normally
torts, property or contracts).

Make sure P has a case and a relief is needed.

Determine appropriate remedies (based on available remedies for that

substantive area of law).
o Discuss legal remedies first.
o Discuss restitutionary remedies.
o Discuss pure equitable remedies.

Function of Remedy
Damages:
o Compensatory Damages: The goal is to put the P in their rightful
position.
Compensatory damages provide an award of money to the
aggrieved party to compensate for any loss or injury.

Compensatory damages are substitutionary remedies.

In tort cases, the objective is to make the P whole by awarding

sufficient money to indemnify the plaintiff for the loss.

In contract cases, the objective is not only to compensate for loss,

but also to protect the Ps expectation interest by awarding a
sum of money equivalent to what P would have received if the
contract had been performed.

o Nominal Damages: Ps rights have been violated, but no loss is

sustained or the extent of the injury cannot be measured.
Such an award is in effect a declaration of the Ps right and a
determination that the D infringed upon it.
o Punitive Damages: A sum of money awarded to the P in addition to
compensatory damages to punish the D for willful, wanton, or
malicious conduct and to deter such conduct by the D and others.

Restitution:
o Restores to P any benefit the wrongdoer may have gained from
misconduct.

o The goal is to compel the wrongdoer to disgorge any unjust gain or

enrichment.
o Substitutionary Remedies: Provide P with monetary recovery
measured by Ds unjust gain, rather than with the precise thing
wrongfully obtained.
Examples of substitutionary restitutionary remedies include, QuasiContract Actions at law, Constructive Trust, Equitable Lien, and
Subrogation in equity.
o Specific Remedies In Restitution: Provide recovery of precise
thing the D wrongfully obtained.

Specific Relief:
o Gives the injured party the precise performance promised rather than
its equivalent in money.
o Specific performance of contracts, in which the D is ordered to perform
his promise, illustrates this type of relief.

Preventive Relief:
o Affords protection of the Ps rights by a decree prohibiting (enjoining)
the D from doing certain acts or engaging in particular activities
infringing on the P interests.

Declaratory Relief:
o A declaratory judgment conclusively determines the rights of
parties involved in a contested issue, thereby settling the controversy
without awarding any additional relief, such as damages, restitution, or
a coercive decree.

Tort Remedies
Overall Approach For Tort Remedies:
o Has P been/being injured?
ANSWER: Compensatory Damages
o Has D derived any Unjust Enrichment?
ANSWER: Restitutionary Damages
o Does P want the property back?
ANSWER: Replevin, Ejectment, Specific Performance
o Does P need an Injunction?
ANSWER: Preliminary, TRO, Permanent

Tort Damages & Equitable Remedies

o Recovery in Tort is limited by proximate cause.
o Compensatory Damages: If a party has sustained harm because of a
tort, the objective of the remedy of compensatory damages is to place
the injured party in substantially as good a position as he occupied
prior to the wrong.

Plaintiff must show:

Causation: The injury must have been caused by the tortious
act.
o But For Test: But for the tortious action, the injury wouldn't
have happened

Foreseeability: The injury mustve been foreseeable at the time

of the tortious act (proximate cause); and

Certainty: The damages cannot be too speculative.

o Non-Economic Damages: General pain and suffering,
disfigurement
Certainty requirement does not apply. Only required for
economic losses (special damages).
o Future Damages:
All or Nothing Rule: For future damages, P must show that
the damages are more likely to happen than not. Failure to
demonstrate this will result in no award.

Remember for Future Damages discuss probability of

future events occurrence, Lost Profits, Historical Records
i.e., no new business, Medical Expenses

Unavoidability: P must take reasonable steps to mitigate the

damage. Damages limited to those that could not reasonably
have been avoided.
o Calculation: Single lump sum payment, discounted to present
value. No accounting for inflation.

o Nominal Damages: Where the P has no actual injury, the court may
award nominal damages to serve to establish or to vindicate the Ps
rights.
o Punitive Damages:

Where Ps injury results from willful, wanton, or malicious

conduct on the part of the D, the court may award punitive
damages to punish D.

P must first have been awarded compensatory, nominal, or

restitutionary damages.

Calculation: Must be relatively proportional to actual damages.

o Restitution:
Restitutionary Damages: Where the D has been unjustly
enriched, the court may award damages based on the benefit to
the D.
Calculation: The amount is calculated based on the value of the
benefit. However, where both compensatory and restitutionary
damages are available, P cant get both. Instead, he must make
an election of the two. Generally, the P should be awarded the
larger sum of the two.
No Restitution for Encroachment or Nuisance.
o Injunctive Relief:
Temporary Injunctive Relief: To recover to recover temporary
injunctive relief, P must meet a two part test:
Irreparable Injury: P must show that without the injunction, he
will incur irreparable injury while waiting for a full trial on the
merits.
o Balancing Test: harm to P if injunction is denied v. harm to
the D if injunction is granted.
Where D created the hardship (even if substantial)
balance likely to weigh in Ps favor.

Likelihood of success: P must show that he has a strong

likelihood of success on the merits. The court will look to the
probability of this success.
o This is not an inquiry on success of obtaining a permanent
injunction.
o The court should also impose a bond requirement on P to
reimburse the D if the injunction injured him and P does not
succeed.

Permanent Injunctive Relief:

P must meet a five-part test [I Put Five Bucks Down]

o Inadequate Legal Remedy: Money damages may be too

speculative; D may be insolvent; the sheriff may be unable or
unwilling to enforce a replevin or ejectment action.
o Property Interest/Protectable Interest:
Traditional View: Equity will grant relief only where there is
a protectable property right involved.

Modern View: Any protectable interest will suffice.

o Feasibility of Enforcement: Only an issue with mandatory

injunction.
Enforcement problems may stem from:
The difficulty of supervision, or
Concern with effectively ensuring compliance.
o Balancing of Hardships: Ps benefit v. Ds hardship + the
publics hardship [but, if the Ds conduct was willful, no
balancing].
o Defenses (or lack thereof):
Laches: Where there has been an unreasonable lapse of
time between when the P learned of the injury and when
the P filed the lawsuit, and that lapse of time is prejudicial
to the D, laches will cut off the right to injunctive relief
(but not monetary damages).

Unclean Hands: The persons seeking equitable relief must

not be guilty of any improper conduct that is related to the
lawsuit.

Impossibility: It would be impossible for the D to carry out

the terms of the injunction.

Free Speech: Injunction may be denied on free speech

grounds.

Contract Remedies
Overall Approach For Contract Remedies:
Recovery in Contract may be limited by the requirement that
consequential damages be foreseeable.

Has P been/being injured?

o Answer: Expectation Damages

Has D derived any Unjust Enrichment?

o Answer: Restitution

Does P want the property back?

o Answer: Replevin, Ejectment, Constructive Trust, Equitable Lien

Does P want the Contract performed?

o Answer: Specific Performance

Does P want the Contract ripped up?

o Answer: Rescission

Does P want the Contract re-written?

o Answer: Reformation

Contract Damages & Equitable Remedies:

Compensatory Damages: Based on injury to the Plaintiff

o If a party is injured by breach of contract, the objective of
compensatory damages is to place the injured party in substantially as
good a position as he would have had if the contract had been
performed.
Rationale: This measure of damages protects the Ps expectation
interest by awarding any profits that might have been realized from
full performance.
o Requires: Clair Fucked Charlies Uncle
Causation;
Foreseeability (tested at the time of formation);
Certainty;
Unavoidability (mitigation)
o Types of Compensatory Damages: Connies Impala Smashed Nicks
Lamborghini
Consequential Damages: Available for related damages that were
foreseeable at the time of formation (e.g., damage to reputation).

Incidental Damages: Available for hassle involved in dealing

with breach.

Seller Breaches a Land Sale Contract:

Compensatory Damages = out-of-pocket loss OR benefitofthebargain

Nominal Damages:
Nominal damages are also allowed, but punitive damages are
NOT allowed.
o If Ds conduct is willful, you can get punitive damages
because it's a tort.

Liquidated Damage:
Liquidated damage clauses are permissible, if they are valid.
o Liquidated damage clauses must show:
Damages are difficult to ascertain at the time of contract
formation
o Estimate was a reasonable forecast of what the damages
would be.
If liquidated damages are too high, they will be viewed as
a penalty.
o Result: If valid only liquidated damage amount.
o Result: If invalid dismiss liquidated damages clause and
determine actual damages.
o Cant recover both compensatory and liquidated damages.
But can get other remedies outside of actual damages, such
as specific performance.

Restitution:
o Unenforceable Contract: If a contract is unenforceable after P has
performed (due to mistake, capacity, illegality), P can get restitutionary
damages for property/money given to D, or for services rendered for D
for the value of the benefit.
Not necessary to find that the D actually benefited, only that D
received a benefit.

If the value of the services is greater than the Contract rate, P can
still recover that value.

P can get specific property back if it is unique, or D is insolvent.

o Quasi-Contract: P awarded the reasonable value of Ds illgotten gain

or the difference between the present value of the good less the value
before the benefit conferred by P.
o Breach of Contract:

Where Plaintiff is the nonbreaching party:

Plaintiff may recover restitutionary damages for property/money
given to, or servicesrendered for Defendant for the VALUE of the
BENEFIT.

Plaintiff can get the property back if it is unique or Defendant is

insolvent.

Where Plaintiff is the breaching party:

Traditional View: No recovery allowed.
Modern View: Recovery allowed, but limited to Contract price
and must be offset to reflect Defendants damages. Cannot be
greater than Contract rate.

Specific Performance:
o Five Part Checklist
Inadequacy of Legal Remedies:
Damages may be inadequate because:
o Theyre speculative,
o Defendant s insolvent;
o Multiple suits are necessary; and
o The thing bargained for is unique (tested at the time of
litigation, not during contract formation).
Liquidated damage clause $ is inadequate.

Definite and Certain Terms: Terms of the Contract must be sufficient

certain to constitute a valid Contract.

Feasibility of Enforcement: Is this possible? Too much court

supervision needed?

Mutuality of Remedy: Must show the other side can also secure
performance. Only an issue where P lacks capacity. Court will reject
mutuality if it feels secure that P can and will perform.

Lack of Defenses: Unclean hands; laches; unconscionability;

mistake; misrepresentation; equitable conversion (sale to bona fide
purchaser); SoF (satisfied if (1) part performance (2) in reliance on
Contract).

o Special Problems
Deficiencies Fact Pattern

Seller as Plaintif: Can enforce Contract if the defect is minor.

Cannot enforce Contract if the defect is major unless the seller
can cure the Contract before closing.

Buyer as Plaintif: Can enforce the Contract even if the defect is

major (abatement court will lower the purchase price to take
into account this defect). Cannot enforce the Contract if the
defect is very major.
Time of the Essence Clause
Includes forfeiture provision. Equity abhors forfeiture.

Avoid forfeiture (and award specific performance), where:

o Loss to the seller is small;
o Tardiness is de minims;
o Waiver seller has accepted late payments in the past;
o Buyer would suffer undue hardship.

Modern Trend: Courts will give P restitutionary relief if specific

performance were not granted. But, if buyer has not made even
an initial payment the forfeiture clause will be strictly
enforced.

Equitable Conversion: Real property interest of the buyer and seller

are switched upon execution of the land Contract. Thus, the buyer
will be regarded as having the real property interest (the specifically
enforceable right to the land). Seller will be regarded as having the
personal property interest (the specifically enforceable right to the
money).

Covenants Not to Compete (Employment Contracts):

Pose enforcement problems and can be viewed as involuntary
servitude

Two-Part Test for Validity

o The covenant must protect a legitimate interest.
o The covenant must be reasonable in both its geographical
and durational scope.

Rescission
o Equitable Remedy: whereby one who is fraudulently induced into
entering a Contract may rescind the Contract.
o TwoStep Analysis:

Determine if there are grounds for the rescission (improper

formation of contract):
Mistake
Misrepresentation
Coercion
Undue Influence
Lack of Capacity
Failure of Consideration
Illegality

o Mutual Mistake of Fact

Mutual mistake of material fact = grounds

Mutual mistake of collateral fact grounds

Unilateral mistake grounds UNLESS the nonmistaken party knows

or should haveknown of the mistake.

o Defenses: Determine if there are valid defenses.

Unclean hands, laches (negligence is NOT a valid defense).
o Special Problems:
Timing and Election of Remedies:
If Plaintiff sues for damages first, rescission is NOT allowed.
If Plaintiff sues for rescission first, damages ARE allowed.

Availability of Restitution: If a Plaintiff who is entitled to rescission

has previously rendered performance on the Contract, he can get
compensated for it or get the property back via restitution.

Legal Rescission: Plaintiff accomplishes this by her own actions.

Plaintiff gives notice and tenders back any consideration received.
Plaintiff then sues for restitution for anything given to Defendant.

REFORMATION
o The Court may modify a written agreement to conform w/ the parties
original understanding.
o Three Steps:
Determine if there is a valid contract.
Determine if there are grounds for reformation.

Mutual mistake
Unilateral mistake IF nonmistaken party KNOWS of mistake
Misrepresentation

o Determine if there are valid defenses:

Unclean hands
Laches.