Reading Assignment

Remedies Reading Assignment

For 9/3, read pp. 41-49 and 53-60.

Consequential Damages : 1. What is the contract measure of damages in Buck? How much do you think damages will amount to under the contract? 2. Do the contract damages represent the Buck plaintiff’s only loss? 3. What terms does the Buck court use to describe both kinds of damages that plaintiff suffered? What is the standard for awarding consequential damages in tort cases? In contract cases at common law? How do these standards differ? Which one applies in Buck? Is the plaintiff entitled to consequentials under the facts of Buck? 4. Buck represents the common law approach to consequential damages. UCC Section 1-106 also allows for consequential damages. The relevant sections defining such damages are 2-710 and 2-715. What is the difference between incidental and consequential damages under Section 2-715? Why are sellers allowed only incidental damages in 2-710? 5. Meinrath involves the availability of consequential damages upon the defendant’s failure to pay money. a. Why doesn’t the Meinrath court award consequential damages? Is the court’s reasoning sound? b. When do courts award consequentials for failure to pay money?

Review Problem – the kind that would be on a test or problem set (easyish version) Ellen is moving from Columbia to L.A for a new job. She signed a contract with Jack to rent an apartment at $1,500 a month for 12 months beginning immediately. She told Jack that she would return to Columbia to gather her stuff and move them immediately. Ellen hired a moving service to move her belongings from Columbia to L.A. for $4,500. Upon arrival in L.A., Ellen discovered that Jack had rented the apartment to someone else for $2,100 a month.

While looking for new apartment Ellen checked into a hotel for seven days at a nightly rate of $125 while looking for a new apartment and stored her belongings at U-Store-It for $300. After searching all week, she found an apartment comparable to the first for $2,000/month (the going rate for such apartments). Ellen signed a one year lease.

Ellen sued Jack for breach of contract. What kind and amount of damages is Ellen entitled to recover and why? Limitations of Remedies Clauses – Kearney & Trecker 1. How many clauses limiting remedies are involved in Kearney & Trecker? 2. What requirements must be met for a “substituted remedy” clause to be enforced? Why does the UCC care whether these standards are met – i.e., why can’t parties agree to limit their remedies as they see fit? What happens if a substituted remedies clause does not meet the UCC requirements for its enforcement? Why was the substituted remedies clause in K&T not enforceable? 3. When does the UCC allow parties to limit consequential damages? What is the difference between that standard and the standard for substituted remedy clauses? 4. The CRITICAL issue in K&T is whether the clause limiting consequentials ALSO fails when the substituted remedies clause fails. How does the court answer that question? What is its reasoning? What approach do other courts take? Why?

Note: There is additional UCC handouts but also we will refer back a little bit to the one from last week.