Contracts Question

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candidlatke

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Contracts Question

Postby candidlatke » Wed Dec 14, 2016 5:49 pm

Hi, I had a quick question about Contract Law.

So I understand that generally for breaches of contract when it comes to some kind of performance, there are two measures of damages, either calculated by the difference in value (e.g. I paid $100 for a table to be built and the contractor made a $80 one instead so I can get $20), or I can get the cost of compliance (depending of course on how much it would cost/how much trouble it would be to do so.)

Is there a term for, or are there any sort of damages/penalties that I could argue for if the contractor botched the job, making a $100 table but not quite to my specifications?

E.g. I pay $100 for a table that's supposed to be 5 feet tall. They make it to be 4' 10.5". It's not quite what I asked for, but it's appraised by everyone to be about the same value. To rebuild it would cost another $100 so that's not really feasible/fair. I can't get the difference in value since there is none. The 5' requirement wasn't a material requirement, but was still something I asked for nonetheless.

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lymenheimer

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Re: Contracts Question

Postby lymenheimer » Wed Dec 14, 2016 5:59 pm

If it's part of the contract, then you can get the value that you paid, or a new table. The table builder isnt out any money if he can sell it for the same price. But if its not part of the agreement and you're unsatisfied with the lack of 1.5 inches, then you are just a poor negotiator.

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Cloture

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Re: Contracts Question

Postby Cloture » Wed Dec 14, 2016 6:29 pm

This is a contract for services so the restatement is the appropriate authority on an exam. As you mention, expectation damages are capped by economic waste (R348 comments) so the breached upon party isn't getting their perfect 5 foot table. We read a case with a similar situation where the breached upon party was awarded "loss of fun" damages for a swimming pool that was slightly too shallow to dive into, but only bring up this sort of damage calculation if your Professor assigned a similar case.

Valamar

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Re: Contracts Question

Postby Valamar » Wed Dec 14, 2016 8:30 pm

candidlatke wrote:Hi, I had a quick question about Contract Law.

So I understand that generally for breaches of contract when it comes to some kind of performance, there are two measures of damages, either calculated by the difference in value (e.g. I paid $100 for a table to be built and the contractor made a $80 one instead so I can get $20), or I can get the cost of compliance (depending of course on how much it would cost/how much trouble it would be to do so.)

Is there a term for, or are there any sort of damages/penalties that I could argue for if the contractor botched the job, making a $100 table but not quite to my specifications?

E.g. I pay $100 for a table that's supposed to be 5 feet tall. They make it to be 4' 10.5". It's not quite what I asked for, but it's appraised by everyone to be about the same value. To rebuild it would cost another $100 so that's not really feasible/fair. I can't get the difference in value since there is none. The 5' requirement wasn't a material requirement, but was still something I asked for nonetheless.


I assume you're talking about a situation as in Jacobs and Young Inc. v. Kent? The term you're looking for is expectation damages.

Valamar

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Re: Contracts Question

Postby Valamar » Wed Dec 14, 2016 8:44 pm

But as you mentioned, generally the calculation of expectation damages is either cost-to-complete or diminution of market value. So if it doesn't change the market value as in your hypo you're pretty much SoL, and there is no way of recouping unless it was a contract for artistic work or had an express clause for "aesthetic value" or something of that sort. See Morin Building Products Co. v. Baystone Construction Inc.

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