REMEDIES I. TORT REMEDIES COMPENSATORY DAMAGES: Compensatory damages are designed to compensate plaintiff for loss or injury.

Fraud: If seller commits fraud against a buyer: MAJORITY: Purchaser may recover expectancy damages (what he was told property was worth) whether he sues under tort or contract. MINORITY: Purchaser may only recover out-of-pocket losses (sale price) in tort. Must sue in contract for expectancy. Injury to personal property: Destruction of chattel: Damages are measured by: (1) Value at time of destruction, less salvage value, plus interest; OR (2) Replacement cost May also recover lost profits Injury to chattel: Damages are measured by: (1) Diminution in value; OR (2) Cost of repair. May also recover lost profits Conversion: Damages are measured by: (1) Market value at time of conversion, plus interests; OR (2) If value has increased, plaintiff may obtain appreciated value. May also recover lost profits Injury to real property: Damages may be measured by: (1) Diminution in value and loss of use; OR (2) Cost of repair and loss of use May also recover lost profits Personal injury: Economic losses (Special damages): Plaintiff may recover for all out-of-pocket losses. 1. Lost wages 2. Lost earning capacity 3. Medical expenses 4. Property damages 5. Funeral and burial expenses Non-economic losses (General damages): Plaintiff may recover fair and reasonable compensation for non-economic losses. 1. Pain and suffering 2. Humiliation 3. Shock 4. Loss of reputation 5. Loss of consortium, society, and companionship 6. Emotional distress: May recover for emotional distress if IIED, or in the following circumstances: (1) Negligent transmission of message; (2) Negligent mishandling of corpse; (3) Zone of danger AND physical manifestation of distress; or (4) Physical injury/victim of intentional tort 7. Loss of expected financial support 8. Loss of expected inheritance: Must show evidence supporting projections of high income, savings or investment plans, etc. 9. Loss money value of services, advice, training and companionship Wrongful death/survival: SURVIVAL STATUTE: Recovery for damages decedent would have been able to recover had he survived. Creditors: Recovery under survival statutes go to the estate, and so creditors may reach damages DEATH STATUE: Recovery for damages family suffered from loss. Creditors: Recovery under death statutes go to the family, and so creditors may not reach damages Interest: Awards of prejudgment interest may be available, as determined by statute. Attorneys fees: Generally attorneys fees are not recoverable (except for shareholders in a derivative suit). Discounting to present value: A lump sum award for future damages must be discounted to present value. Limitations: Duty to mitigate/avoidable consequences: Plaintiff may not recover for losses that could have been avoided through reasonable efforts Reasonable certainty: Plaintiff must show damages with reasonable certainty. Collateral source rule: A plaintiff who has been compensated independently (by insurance, friends, employment benefits, etc.) may still recover from defendant. Plaintiff should be encouraged to self-help. NOMINAL DAMAGES: Nominal damages are recoverable when there is no actual injury. NOTE: However, some torts require damages be proved as an element, so nominal damages will not be allowed in those instances. PUNITIVE DAMAGES: Punitive damages are designed to punish defendant for conduct that is willful, wanton, or malicious. Punitive damages may not be grossly excessive. Balance the following: 1. Reprehensibility of the conduct: The more reprehensible, the more punitive damages may be awarded. 2. Amount of compensatory damages (Ratio): Ratios above 9:1 are rarely acceptable, except in cases where compensatory damages are very low. 3. Amount of civil or criminal penalties authorized for comparable misconduct RESTITUTIONARY REMEDIES: Restitutionary remedies are designed to restore to plaintiff any benefit defendant received wrongfully to prevent unjust enrichment. Replevin (LEGAL): Replevin is a legal remedy that permits a plaintiff to recover possession of specific chattel wrongfully taken. NOTE: May also recover compensatory or restitutionary damages for loss of use, etc. Bond: Plaintiff may recover the property before trial, but will have to post a bond. Redelivery bond: Defendant may defeat immediate recovery by posting a redelivery bodn. Ejectment (LEGAL): Ejectment is a legal remedy that restores possession of real property when plaintiff was wrongfully ousted Restitutionary damages/Quasi-contract (LEGAL): Restitutionary damages are designed to pay to plaintiff the reasonable value of a benefit unjustly obtained, measured by defendants gain. Constructive trust/Equitable lien (EQUITABLE): Constructive trust: Law imposes a trust/ on property, compelling defendant to reconvey title to property unjustly retained. Equitable lien: Law imposes lien on property. 1. Unjust enrichment: Defendant would be unjustly enriched if he kept the benefit obtained from plaintiff 2. Must identify specific property that was acquired wrongfully OR Defendants property was improved by plaintiff (Equitable lien only) Tracing: If defendant has disposed of specific property, plaintiff may place a constructive trust/equitable lien on the property directly traceable to the specific property. Commingling: In cases of commingling, the law presumes that: (1) Defendant spends his own money first; (2) Defendant Invests plaintiffs money first . (3) Lowest intermediate balance: If there are successive deposits and withdrawals, plaintiff is entitled to the lowest intermediate balance. NOTE: May be intent to replenish later deposits. Bona fide purchaser: Plaintiff loses to a bona fide purchaser. But, can trace to defendant. 3. Legal damages are inadequate (MAJORITY): Legal damages must be inadequate. Generally this means that the defendant is insolvent. NOTE: Plaintiff may choose constructive trust if the property increases in value. NOTE: Plaintiff may choose equitable lien if the property decreases in value, and may obtain a deficiency judgment for the rest. NOTE: Plaintiff takes priority over other unsecured creditors. However, any deficiency judgment does not take priority. INJUNCTIVE RELIEF: Where legal remedies are inadequate, plaintiff may obtain an injunction. Temporary Restraining Order: A T.R.O. is a short-term decree designed to maintain the status quo to avoid irreparable herm. It usually lasts only 10 days. 1. Irreparable harm: Must show irreparable harm if preliminary injunction is not awarded 2. Likelihood of success: Plaintiff must show he is likely to win on the merits 3. Bond: Must post a bond Ex-parte T.R.O.; Generally notice must be given to the other party. However, in some cases, an expoarte T.R.O. can be issued if notice is impossible or would create irreparable harm. Preliminary injunction: A preliminary injunction is a temporary injunction granted after a hearing, designed to maintain the status quo pending completion of the proceedings. Same requirements as above. 1. Irreparable harm: Must show irreparable harm if preliminary injunction is not awarded 2. Likelihood of success: Plaintiff must show he is likely to win on the merits 3. Bond: Must post a bond Permanent injunction: An injunction awarded after trial. 1. Substantive merits: Plaintiff must prove the underlying tort 2. Legal remedies inadequate: Legal damages are inadequate in the following circumstances (this is an inexhaustive list) Unique items/irreparable injury: Damages are inadequate for unique items: Real property, Antiques, Heirlooms, Stock in private company, Routine items in times of shortage, etc. Repeated acts: Damages are inadequate if plaintiff would have to sue repeatedly to enforce the law Prospective tort: If the wrong has not yet occurred, no legal remedy exists Insolvency of defendant: Damages are inadequate if defendant is insolvent Speculative damages: Damages are inadequate if plaintiff could not prove damages with reasonable certainty 3. Balance equities/no undue hardship: Must balance equities to ensure that hardship to defendant does not greatly outweigh benefit to plaintiff. If defendants conduct was willful, hardship likely is not undue. 4. Feasibility: A court will not issue an injunction if it would be impractical, or difficult to supervise. Mandatory injunction: A decree ordering defendant to perform. This is difficult to enforce. Negative/prohibitory injunction: A decree prohibiting defendant. This is not difficult to enforce. 5. Property right/Protectible interest: Traditionally equity protected only property rights. Few courts still follow this rule. Need any protectible interest. 6. Equitable defenses: Discuss equitable defenses always Contempt: Contempt is the courts power to enforce injunctions. Criminal contempt: Court imposes fines or jail sentences for violating the injunction. Designed to punish for willful violations Collateral bar rule: Defendant cannot defend against the contempt charges on the grounds that the injunction was invalid. Defendant must comply with the injunction and appeal. Civil contempt: Court imposes fine or jail time to coerce defendant to comply. Defendant holds keys to jailhouse. Defendant can defend against civil contempt on grounds that the injunction is invalid. Special limits: A court will not award injunction in certain circumstances: Prior restraints: 1st Amendment protects speech, and courts will be very hesitant to grant a prior restraint. Criminal conduct: Courts will generally not grant an injunction protecting against criminal conduct. However, most crimes are also torts, so injunctive relief may be granted to prevent tortious conduct. Replevin: If replevin is an adequate remedy, an injunction ordering defendant to return the property is unnecessary because replevin is a legal remedy, and hence legal remedies are adequate. DECLARATORY RELIEF: Designed to resolve uncertainty of legal rights. EQUITABLE DEFENSES: The following defenses are available to the equitable remedies: Constructive trust; Equitable lien; Injunctions Laches: An equitable remedy will not be awarded if plaintiff brings claim after (1) Unreasonable delay (2) Prejudicial to defendant. Unclean hands : If plaintiff is guilty of misconduct in the same transaction, he will be precluded from an equitable remedy. Undue hardship: An equitable remedy will not be awarded if it creates an undue hardship to the defendant

I. CONTRACT REMEDIES

COMPENSATORY DAMAGES: Compensatory damages are designed to restore plaintiff to his rightful position.
Expectancy: Expectancy is designed to give plaintiff the benefit of the bargainthe position he would be in had contract been performed . Contracted value (or warranted value) less actual value received.

UCC: Expectancy: Seller breaches, buyer keeps goods: Fair market value as perfect Fair market value as delivered. Seller breaches, seller keeps goods: Market price OR Replacement price contract price. Buyer breaches, buyer keeps good: Contract price Buyer breaches, seller keeps goods: Contract price Market price at time of delivery OR Resale price.
* Lost volume: Sellers may recover lost profits when as a result of a breach by buyer the seller lost a sale. NOTE: This only arises when seller has a large supply. Incidental damages: Plaintiff may recover indirect damages naturally resulting from breach of contract. EXAMPLES: Costs of storing, shipping, reselling, etc. Consequential damages: Plaintiff may recover indirect damages unique to this contract only if the damages were foreseeable at formation.
Limitations: Duty to mitigate/avoidable consequences: Plaintiff may not recover for losses that could have been avoided through reasonable efforts Reasonable certainty: Plaintiff must show damages with reasonable certainty. New businesses: May try to show damages by: (1) Profits before and after; or (2) Similar business. However, this may be too speculative, because new business are prone to financial difficulty. Limitation of remedy clause: Parties may contract to limit available remedies so long as not unconscionable. NOTE: If a breach causes personal injury, enforcement would be prima facie unconscionable.

Liquidated damages clause: Clauses that limit damages to a certain amount will be allowed so long as: 1. Damages from breach were difficult to ascertain at time of formation; AND 2. Liquidation amount was a reasonable estimate of losses under the circumstances . UCC: Under the UCC, a court can consider actual damages to determine validity of clause. No overcompensation . Liquidation amount does not overcompensate. NOTE: Courts may allow under-compensation, but NOT over-compensation (penalty). Interest: Awards of prejudgment interest may be available, as determined by statute. Attorneys fees: Attorneys fees are recoverable if provided for by statute or contract.

NOMINAL DAMAGES: Nominal damages are recoverable when there is no actual injury. PUNITIVE DAMAGES: Punitive damages are NOT available in contract actions . Look for any possible tort claims that might give rise to punitive damages.
RESTITUTIONARY REMEDIES: Restitutionary remedies are designed to restore to plaintiff any benefit defendant received wrongfully to prevent unjust enrichment. Quasi-contract: If no other contract remedy is available, quasi-contract is a remedy that obligates defendant to pay plaintiff the reasonable value of a benefit unjustly obtained. Quantum meruit. Reliance damages: Plaintiff may also recover any costs incurred in reliance on the contract. NOTE: Reliance damages are not really restitutionary because they are measured by plaintiffs reliance, not defendants gain. Reclamation: UCC :A seller of goods may demand his goods back if: (1) Buyer is insolvent at time he received goods; (2) Demands return within 10 days; and (3) Buyer still has goods. This will be his only remedy. SPECIFIC PERFORMANCE: Where legal remedies are inadequate, the court may order a contracting party to perform his contractual duty. Specific performance: A court will only grant specific performance if there is a valid contract, and the terms are definite and certain. 1. Valid contract with definite and certain terms; AND Defendants performance is due (no conditions, etc.) 2. Legal damages inadequate: Legal damages are inadequate in the following circumstances (this is an inexhaustive list). Unique items/irreparable injury: Damages are inadequate for unique items: Real property, Antiques, Heirlooms, Stock in private company, Routine items in times of shortage at time of litigation,, etc. Insolvency of defendant: Damages are inadequate if defendant is insolvent Speculative damages: Damages are inadequate if plaintiff could not prove damages with reasonable certainty Personal service contracts: Generally services are not unique, and so legal damages are adequate. Personal services may be unique, but specific performance will be denied due to feasibility problems. 3. Balance equities/no undue hardship: Must balance equities to ensure that hardship to defendant does not greatly outweigh benefit to plaintiff. If defendants conduct was willful, hardship likely is not undue. 4. Feasibility: A court will not issue an injunction if it would be impractical, or difficult to supervise. Personal service contracts: Even where services are unique, courts generally will not enforce service contracts because it is not feasible to supervise, and because it amounts to involuntary servitude. Negative injunction: However, a court may award a negative injunction prohibiting person from providing same unique service for another for the duration of the contract (unless undue hardship). 5. Mutuality of performance: The court must be satisfied that it can also secure plaintiffs counter-performance. This will not be a problem where plaintiff has already performed. EXAMPLE: Plaintiff may be a minor, etc. However, court may still award plaintiff specific performance if it satisfied that plaintiff can and will perform. 6. Equitable defenses: Discuss equitable defenses always

RESCISSION: Legal rescission: Parties may agree to rescind so long as neither party has fully performed. Equitable rescission: A court may order rescission and restore to plaintiff any consideration given. Misrepresentation ; Duress; Undue influence; Incapacity; Intoxication (if other party had reason to know of intoxication); Unconscionabiliby ; Mutual mistake (if basic assumption, material adverse effect, no assumption or risk); Unilateral mistake (if other party knew or had reason to know of mistake)

REFORMATION: In very limited circumstances, a court will modify a written instrument to reflect the parties true agreement.
EXAMPLE: If parties agreed to certain terms, but the writing contains different terms by mistake or by fraud, the contract may be reformed to reflect the agreed upon terms. EXAMPLE: A deed of land containing mistaken boundaries/acres may be reformed to reflect parties intent so long as the mistake: (1) Size difference not material; and (2) Price reduction is proportionate Divisible contracts: In very limited circumstances, if a contract is clearly divisible, a court may divide the contract into separate contracts.

EQUITABLE DEFENSES: The following defenses are available to the equitable remedies: Constructive trust; Equitable lien; Injunctions
Laches: An equitable remedy will not be awarded if plaintiff brings claim after unreasonable delay that causes prejudice to defendant. Unclean hands: If plaintiff is guilty of misconduct in the same transaction, he will be precluded from an equitable remedy. Undue hardship: An equitable remedy will not be awarded if it creates an undue hardship to the defendant. In contract actions, undue hardship may result if enforcement would be unconscionable. Election of remedies: If plaintiff first seeks damages or specific performance, he will not later be able to sue for rescission.