Remedies for Breach of Contract CHAPTER 14 3/27/2017 LESSON 14-1 Remedies for Breach of Contract Distinguish between minor and major breach Describe when the remedies of rescission and specific performance are available Define four types of damages and tell when they will be awarded by courts

TYPES OF BREACH AND REMEDIES How does minor breach affect the victim’s duties? How does major breach affect the victim’s duties? What are rescission and restitution?

TYPES OF MONEY DAMAGES Compensatory Consequential Liquidated Punitive Nominal

SPECIFIC PERFORMANCE Money damages inadequate Subject matter unique Ability to supervise Clean hands

Denial of Remedies for Breach of Contract LESSON 14-2 Denial of Remedies for Breach of Contract Describe the election of remedies Describe the requirement to mitigate damages Explain how the statute of limitations and bankruptcy affect remedies for breach of contract

HOW CAN ELECTION OF ONE REMEDY BAR USE OF ANOTHER REMEDY? An injured party must elect, or choose, a remedy when suing. Specific performance and damages cannot be recovered for the same breach because specific performance is not available when damages are an adequate remedy.

HOW CAN FAILURE TO MITIGATE DAMAGES ELIMINATE REMEDIES? The injured party must usually take reasonable steps to mitigate damages.

HOW CAN WAIVER ELIMINATE REMEDIES? Sometimes a party intentionally and explicitly gives up a contractual right. This is called a waiver.

HOW CAN THE STATUTE OF LIMITATIONS ELIMINATE REMEDIES? Statutes in all states deny any remedy if suit is not commenced within a certain time after a legal claim arises. Four years is a common time for the statute of limitations for contracts. Three years is a common time for the statute of limitations for torts.

HOW CAN BANKRUPTCY ELIMINATE REMEDIES? Bankruptcy is a legal proceeding whereby a debtor’s assets are distributed among his or her creditors to discharge debts.

REMEDIES FOR BREACH OF CONTRACT Rescission and Restitution Damages Specific Performance Injunction Waiver Consequential Compensatory Liquidated Punitive Nominal