Testimony of owner of property (but credibility might be an issue) Comparable of similar properties Arms’ length resale of property involved in K dispute, not fire sale or compulsive (if resale after time of breach, consider surrounding circumstances for whether good indication of FMV at time of breach) G/R: post-judgment interest to successful party, but pre-judgment interest only where P’s claim was for liquidated sum (ascertainable amount) Rst Modern Rule: non-breaching party’s damages can be measured by either (1) diminution in value or (2) reasonable cost to complete or repair defects if that cost is not clearly disproportionate to probable loss in value to her CL Traditional Rule: non-breaching party’s damages are generally measured by cost to complete, and diminution in value is the exception diminution in value exception Jacob & Youngs v. Kent: applies only when substantial performance made in good faith and cost of completion involves great economic waste (i.e., tearing down already completed work); applies when breach was incidental and cost of completion was disproportionate (and would overcompensate P) Restrictions on Recovery losses may be foreseeable as a probable result Foreseeability: of breach because it follows from the breach (1) in the ordinary course of events (arise naturally from the breach – general or direct damages) or (2) as a result of special circumstances, beyond ordinary course of events, that breaching party had reason to know, e.g., if other party told them Lost profits from collateral Ks Injury to person or property caused by goods that do not conform to K warranties New business: traditionally, courts rejected lost profit claims; modern trend is to allow a new business to try to establish lost profits by, for example, offering proof of profits of comparable businesses Certainty: evidence must be sufficient to persuade fact-finder that loss is more likely to have occurred than not (preponderance of evidence) and must give fact-finder enough basis for calculating money damages
Testimony of owner of property (but credibility might be an issue) Comparable of similar properties Arms’ length resale of property involved in K dispute, not fire sale or compulsive (if resale after time of breach, consider surrounding circumstances for whether good indication of FMV at time of breach) G/R: post-judgment interest to successful party, but pre-judgment interest only where P’s claim was for liquidated sum (ascertainable amount) Rst Modern Rule: non-breaching party’s damages can be measured by either (1) diminution in value or (2) reasonable cost to complete or repair defects if that cost is not clearly disproportionate to probable loss in value to her CL Traditional Rule: non-breaching party’s damages are generally measured by cost to complete, and diminution in value is the exception Jacob & Youngs v. Kent: diminution in value exception applies only when substantial performance made in good faith and cost of completion involves great economic waste (i.e., tearing down already completed work); applies when breach was incidental and cost of completion was disproportionate (and would overcompensate P) Restrictions on Recovery Foreseeability: losses may be foreseeable as a probable result of breach because it follows from the breach (1) in the ordinary course of events (arise naturally from the breach – general or direct damages) or (2) as a result of special circumstances, beyond ordinary course of events, that breaching party had reason to know, e.g., if other party told them Lost profits from collateral Ks Injury to person or property caused by goods that do not conform to K warranties New business: traditionally, courts rejected lost profit claims; modern trend is to allow a new business to try to establish lost profits by, for example, offering proof of profits of comparable businesses Certainty: evidence must be sufficient to persuade fact-finder that loss is more likely to have occurred than not (preponderance of evidence) and must give fact-finder enough basis for calculating money damages
Contracts-Pratt-2015.docx