Liquidated damages and mitigation Bar Exam Flashcards - Medical Study Cards
Master Liquidated damages and mitigation with Oncourse flashcards. These spaced repetition flashcards are designed for medical students preparing for NEET PG, USMLE Step 1, USMLE Step 2, MBBS exams, and other medical licensing examinations.
Liquidated damages and mitigation Flashcard Deck - 10 Cards
Flashcard 1: How are a buyer’s damages generally measured under UCC Article 2?
Answer: A buyer may recover cover price minus contract price, plus incidental and consequential damages, minus expenses saved; without cover, the buyer may recover market price at the time the buyer learned of the breach minus contract price, plus incidental and consequential damages. The buyer must act in good faith and may recover consequential damages that were foreseeable and could not reasonably be prevented.
Flashcard 2: How are a seller’s damages generally measured under UCC Article 2?
Answer: A seller may resell in good faith and recover contract price minus resale price, plus incidental damages, minus expenses saved; alternatively, the seller may recover contract price minus market price when the seller learned of the breach, plus incidental damages. A lost-volume seller may recover expected profit, including reasonable overhead, when resale would have occurred in addition to—not instead of—the breached sale.
Flashcard 3: What is the injured party’s duty to mitigate damages?
Answer: The injured party must make reasonable efforts to avoid or reduce losses, but need not take unreasonable risks, incur disproportionate expense, or suffer humiliation. Damages are reduced by losses that reasonable mitigation would have avoided.
Flashcard 4: When is a liquidated-damages clause enforceable?
Answer: Under the majority and Restatement rule, the amount must be a reasonable forecast of the loss and the loss must have been difficult to estimate when the contract was formed; an amount designed to punish is an unenforceable penalty. UCC § 2-718 similarly requires reasonableness in light of anticipated or actual harm and the difficulty of proof.
Flashcard 5: What elements generally support an injunction as a contract remedy?
Answer: The applicant must show likely irreparable harm, inadequacy of legal remedies, a favorable balance of hardships, and consistency with the public interest; the requested order must also be sufficiently definite and feasible to enforce. The court exercises equitable discretion rather than awarding an injunction automatically.
Flashcard 6: What is the general purpose and formula for expectation damages?
Answer: Expectation damages put the injured party in the position it would have occupied had the contract been performed: loss in value plus incidental and consequential damages, minus costs or losses avoided.
Flashcard 7: When will a court award specific performance for breach of contract?
Answer: Specific performance is available when money damages are inadequate, the contract’s terms are sufficiently definite, and the court can feasibly supervise performance; land is ordinarily treated as unique, and unique or scarce goods may qualify. It is generally unavailable for personal-service contracts because supervision and involuntary service are improper.
Flashcard 8: What is the rule for certainty of damages?
Answer: Damages must be established by reasonable evidence rather than speculation; a court may deny recovery for uncertainty in the fact or amount of loss. Lost profits are recoverable when supported by reliable data, even if the business is new, under the modern majority approach.
Flashcard 9: What must a claimant establish to recover contract damages for a particular loss?
Answer: The breach must be a factual and legal cause of the loss, the loss must have been foreseeable when the contract was made, and the amount must be proven with reasonable certainty. Special damages generally require facts or circumstances communicated to the breaching party at formation.
Flashcard 10: How do reliance and restitution damages differ from expectation damages?
Answer: Reliance damages reimburse reasonable expenditures made in reliance on the contract, while restitution damages restore a benefit conferred on the breaching party to prevent unjust enrichment. Reliance recovery may be reduced by losses the breaching party proves the injured party would have suffered even if the contract had been performed.
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