Remedies Short Outline
Remedies: Approach 2 Problems
1. Is there a damage remedy?
a. Measure of damages (FCU)
2. Is there a restitutionary remedy?
a. Unjust enrichment?
b. Constructive trust?
c. Equitable lien?
d. Defenses
3. Is equitable relief available?
a. JIFB
b. Defenses
Function of Damages Remedies
1. Compensatory Ds= comp 4 loss
a. Tort → make P whole
b. K → expectation interest; put in
position as if K performed
2. Nominal = vindicate rt, no loss
3. Punitive = punish 4 malicious conduct
Function of Restitutionary Remedies
1. restore 2 P BNT D gained from misconduct
Damages Remedy
Breach of Contract: Remedies
1. General damages
2. Special damages
3. Restitution
4. Punitive if breach also tort
5. Attorney Fees if K/statute so provides
6. Prejudgment interest if claim liquidated or
certain of calculation from fixed date
7. Inflation Adjust→ no b/c loss valued @ breach
Breach of Contract: Damages Remedy
1. Measure of damages = BNT of bargain,
expectation interest
2. But can only recover damages that R FCU
Breach of Contract: Foreseeability
1. Foreseeability measured @ time of formation
2. General Ds = foreseeable b/c arising naturally
from breach in usual course of things
a. Consideration/cost 2 cover
b. Foreseeable as MOL
3. Special Ds = foreseeable b/c notice of particular
Fs @ time of formation
Hadley v Baxendale
1. delay in delivery by carrier
2. Issue = liability 4 lost profits?
3. Held → no b/c carrier had no reason 2 know
P’s mills would be close due 2 delay
4. Rule = special damages limited 2 those w/in
reas contemplation of parties @ time K made
Certainty
1. Damages must B proven w/ “reas certainty”
2. If can prove fact of loss with high degree of
certainty, amount can be speculative
3. Lost profits → established v new biz?
4. Aspiring talent → recover 4 lost opportunity
Prejudgment Interest: Requirements
1. Liquidated claim
2. OR certain of calculation from fixed date
1
Liquidated Damages Clause
1. Upheld if extremely diff 2 ascertain damages
2. & reas forecast of actual damages
3. If not → deemed “penalty” & prove actual
damages
4. Recover even if no actual loss or loss minimal
Unavoidable
1. No recovery 4 losses that reas could have been
avoided @ time of harm/breach
2. Test = reas person standard
Unavoidability: When reas 2 decline surgery?
1. If imposes undue risk
2. OR mental anguish
Collateral Source Rule
1. Damages are not reduced by compensation
paid from independent collateral source
2. e.g., insurance, welfare
Breach of K: Mental Anguish Damages?
1. Gen R = no unless serious ED &
2. Common carrier, hotel, funeral
Breach of K: Punitive Damages
1. Gen R = no unless:
2. Breach is also tort
3. Breach of covenant of GF & FD in INS K
4. b/c special relationship highly susceptible 2
unequal bargaining power
Remedies Short Outline
Tort Remedies
Injunctive Relief
Torts: General v Special Damages
1. G = losses reas foreseeable from harm (P&S)
2. S = losses not reas foreseeable from harm
(med expenses/loss of earnings)
Requirements for Granting Injunctive Relief
1. Justifiable interest
2. Inadequacy of legal remedy
3. Feasible 2 enforce
4. Balance of hardships
Punitive Damages
1. Purpose = punish 4 willful/malicious conduct
2. Grossly excessive PDs violate DP
a. Reprehensibility of conduct?
b. Ratio btwn amount & actual loss (10x
limit)?
c. Statutory sanctions 4 comparable
crim conduct?
3. Never consider nonparty injuries
Personal Injuries
Personal Injuries
1. General Damages (non-economic losses)
a. P&S
b. Mental anguish
c. Loss of Enjoyment of Life (coma)
2. Special Damages (economic losses)
a. Medical expenses
b. Loss of Earnings
Personal Injuries: Computing the Award
1. Discount future losses to present value
2. Don’t discount past losses
3. Defendants prefer higher discount rate
4. Juries may increase award 2 comp 4 inflation
5. Juries shouldn’t consider taxes
Injunction
1. CT order ordering 2 refrain from act (neg)
2. CT order ordering 2 perform act (mand)
3. Neg more feasible 2 enforce, supervise
When are Legal Remedies Inadequate?
1. Damages not enough 2 compensate
2. Damages 2 speculative/diff 2 compute
3. Numerous & continuous harm requiring
multiplicity of suits (e.g. continuous trespass)
4. K 4 or harm 2 unique item (all RE unique)
5. Prospective tort threatened
6. Insolvency
Enforcing the Equitable Decree
1. Civil contempt (jail/$) until compliance
2. Crim contempt (jail) 2 punish 4 disobeying CT
3. If crim → crim pro safeguards (diff CT
adjudicates, intent req)
4. Defense (civ) = inability 2 comply
Equitable Decrees Ordering Payment of Money
1. Can’t imprison 4 failure 2 pay debt
2. But can imprison (civil contempt) 4 violating CT
order to pay debt like spousal support
Who’s Bound by Equitable Decree?
1. parties & privies
2. nonparties can ignore unless
a. “acting in concert” w/ named party
b. Getting some BNT
c. & actual notice
2
Specificity of an Equitable Decree
1. Order must specify req’d/prohibited conduct
2. Can’t incorporate by reference 2 another doc
3. e.g. (cmplt, arbit award)
TRO
1. purpose = maintain status quo pending PI
2. Ex parte if urgency
3. Lasts 10 days
4. Test = whether P’s hardship if denied
outweighs D’s hardship if granted and decided
@ trial P not entitled 2 permanent injunction
Preliminary Injunction: Elements
1. likelihood of success on merits
2. irreparable harm
3. balance of hardships favors P
4. public interest
Equitable Defenses
1. Laches (eq only)
2. Unclean hands (eq only)
3. Estoppel (legal & eq)
Laches
1. unreasonable delay & prejudice from delay
2. May B shorter than SOL
3. Begins 2 run when P has knowledge of right
infringement
4. Defense 2 eq claim only
Remedies Short Outline
Unclean Hands
1. Party seeking relief must not have engaged in
inequitable/wrongful conduct
2. directly related 2 subject of litigation
3. Defense 2 eq claim only
Estoppel
1. Prohibits party from asserting claim/defense
inconsistent w/ prior stmnt
2. Elements:
a. Stmnt (words, acts, silence)
b. Misleading or false, though
knowledge of falsity not req’d
c. Reliance on the stmnt
d. Harm if party allowed 2 assert
claim/defense inconsistent w/ stmnt
3. Defense 2 legal or eq claim
Restitutionary Remedies
Restitutionary Remedies
1. Given if D wrongfully obtained BNT
(property/services) & unjust 2 retain
2. Purpose = disgorge D’s gain
3. Measure of award = D’s gain
Restitutionary Remedies: Types
1. Legal restitutionary remedies
a. Quasi-K
b. Replevin
2. Equitable restitutionary remedies
a. Constructive trust
b. Equitable lien
Incidental Benefit Rule
1. If P acts 4 own BNT + incidentally BNTS D
2. ≠ unjust enrichment
3. Ex: P drains his mine + incidentally D’s mine.
No claim 4 unjust enrichment
Restitution 4 Rescuing Prop
1. Rescuer in lawful possession of prop
2. Act reas necessary B4 owner can B contacted
3. No reason 2 know lack of consent
4. Intent 2 charge
5. Prop accpt’d by owner
Restitution 4 Unsolicited Medical Services
1. Rescuer unofficious + w/ intent 2 charge
2. Act reas necessary 2 prevent serious harm/pain
3. No reason 2 know lack of consent
4. Consent impossible (D unconscious)
Restitution 4 Paying Another’s Debt
1. Gen R = no b/c deprives meaningful choice
(choice of creditor, terms)
2. Unless paid by mistake or 2 protect own
interests
Restitution 4 Services
1. measure of amount = reas value of services
2. not result of services
Restitution: “Change in Position” Defense
3. D made change in position after obtaining BNT
4. Acted in GF
5. Change irrevocable
6. & restitution would B detrimental
Constructive Trust
1. imposes duty on D 2 transfer prop 2 P
2. Elements
a. D has legal title 2 prop
b. Retention would B unjust
3. Cut off by prior sale 2 BFP
Constructive Trust: Effect of sale 2 BFP
1. Cuts off rt 2 constructive trust over prop
2. Can still recover proceeds from transfer
3
What’s the benefit of Constructive Trust over
Monetary Restitution?
1. Allows recovery of prop itself
2. Priority over unsecured creditors (b/c as if P’s
recovering own prop that other creditors have
no claim)
3. Ability 2 capture increase in value
Defenses to Equitable Restitutionary Remedies
1. BFP
2. Laches
3. Unclean hands
4. Estoppel
Equitable Lien
1. charge on prop owned by D 2 secure a debt
2. Holder of lien may sell prop 2 satisfy debt
3. P must show: unjust benefit traceable 2 prop
owned by D
4. Cut off by prior sale 2 BFP
Constructive Trust against D’s Other Assets?
1. Issue = D used misappropriated funds 2 pay off
personal debts or living expenses
2. Min → “swollen asset” theory b/c paying debts
swelled estate
3. Maj → no, P just gen creditor
D steals P’s $ and buys shares of Stock
1. P may seek constructive trust or equitable lien
2. CT → P gets stock itself
3. EL → lien on stock 2 secure misappropriated $
4. If value increased → CT better
5. If value decrease → best 2 sue 4 full amount of
misappropriation secured by EL on stock, &
recover deficiency from D
Remedies Short Outline
Misappropriation of Money
Injuries to Personal Property
Misappropriation of Money: Remedies?
1. Legal remedies
a. Damages
b. Quasi-K (unjust enrichment)
2. Equitable remedies
a. Constructive trust if traceable 2 a res
b. Equitable lien on prop already owned
if cannot B traced
Interference w/ Personal Prop: Sentimental Value
1. Allowed if primary value is sentiment
2. Measure of award = reas value 2 owner
Misappropriation of Money: Tracing Fictions
1. Hallets - D w/drew own $ 1st, so remaining
funds belong 2 P
2. Clayton’s – FIFO
3. Oatway - D acted in way most beneficial 2 P
Misappropriation of Money: Modern Approach to
Commingled Funds
1. Equitable lien for full amount of claim
2. on funds remaining & prop purchased w/
traceable funds
3. Subsequent deposits of own $ → presume
restitution
4. Several Claimants? → pro rata
Tortious Taking & Retention of Personal Prop
1. Damages
2. Restitution
3. Constructive trust (only if traceable to $ or
property purchased w/ the $)
4. Equitable lien
5. Injunction (inadequacy if unique item)
Damage to Personal Prop
1. Get dim in value (FMV B4 – FMV after)
2. OR reas cost of repair (up 2 FMV value)
3. & Loss of use (while being fixed or replaced)
a. rental value of substitute
b. or lost profits if comm
c. reas annoyance/inconvenience
d. [choose 1 only]
Conversion of Securities
1. Issue = unfair 2 award P FMV @ time of
conversion b/c value fluctuates
2. Measures of damages = highest value w/in reas
time after discovery
4
Credits for Appreciation
1. When repairing injured property put in better
position than pre-tort
2. Depreciation method
a. Remaining life @ tort ÷ original useful
life
3. Useful life extension method (PREFERRED)
a. Remaining life @ tort ÷ remaining
years after repair
4. Dock 16 yrs old @ harm. 41 yrs original useful
life. With repairs, new useful life of 51 yrs,
a. Depreciation method= 25/41 x repair
cost
b. Extension method → 25/35 x repair
cost
5. Prop damages, $5000 cost of repair, 10 yrs @
time of harm, 20 yr original useful life, 25 yr
new useful life
a. Depreciation method = 10/20 x $5000
= $2500
b. Extension method = 10/15 x $5000 =
$3333
Remedies Short Outline
Injuries to Real Property
Trespass to Land
1. Measure of damages = dim in value
2. Quasi-K → value of unauthorized use, i.e.,
BNT to D by crossing P’s land
3. Injunctive relief (inadequacy – multiplicity)
Trespass Causing Severance (removal of
minerals, trees, etc.)
1. Measure of damages → depends on intent
2. Innocent (mild) → royalty cost or value of prop
minus extraction
3. Willful (harsh) → value w/ no cost deduction
4. Restitution
5. Punitive (can’t get both harsh and punitives)
6. Injunction (inadequacy – multiplicity)
Trespass Causing Other Injury (dumping trash
on prop)
1. Measure of damages = cost of removal or
rental value of land affected)
2. Injunction (inadequacy - multiplicity)
3. Restitution
Mistaken Improvements
1. Balance of hardships but gen R = no recovery
b/c deprivation of choice/windfall
2. Measure of damages = value improvement or
forced sale of land 2 P
Encroachments
1. Measure of damages = FMV of land
2. Injunction (CTs balance hardships)
a. Wilful encroachment → no balancing
b. Innocent → INJ unless hardship 2 D
grossly disproportionate to P’s
Nuisances
1. use of prop in a way that unreas interferes w/
use & enjoyment of another’s prop
(incompatible use)
2. CTS balance hardships
a. Temp N (caused by neg) → enjoin
b. Permanent N (caused by char of use)
→ Damages =diminution in land
value
3. Alternatives
a. Do nothing (societal interests favor
D’s use)
b. Enjoin but P pays relocation costs
Breach of K: Restitution
1. Non-breacher → recovers value of
performance, even in excess of K price
2. Breacher → recovers BNT conferred in excess
of damages
Breach of K: Specific Performance
1. Inadequacy of legal remedy?
2. Feasible 2 enforce?
Contracts for Real Property
1. Damages or SPERF (both can get SPERF)
a. Inadequacy 2 buyer b/c all land
unique
b. Inadequacy 2 seller b/c doesn’t want
2 B owner anymore
2. Buyer gets → BOB (FMV@breach – K price)
3. Seller gets → BOB (K price – FMV@breach)
5
Construction Contracts
1. Owner gets → cost 2 complete/repair –
remaining K price
2. Builder gets → remaining K price – cost 2
complete
3. Builder Breacher also could get restitution 4
value of services conferred in excess of
damages
Employment Contracts
1. Employee gets → $ promised - $ earned or
could have earned w/ comparable job
2. Employer gets → cost of obtaining equivalent
services
3. Enjoin employee from working 4 others (if in K)
4. No SPERF b/c legal remedies adequate &
feasibility issues
Client Fires Attorney on Contingency K
1. A recovers reas value of services
2. Limited by K price
3. So long as Contingency occurs (C wins case)
4. Policy → C can never B worse off 4 firing A
Survival Action v Wrongful Death
1. SA = brought by estate
2. WD = brought by family members
Right to Jury Trial if Mixed Legal & Equitable
Claims
1. Whether jury (legal) or not (eq) depends on:
2. ST = gist of claim @ time of constitution?
3. Fed = nature of remedy ($ or eq relief?)