Expectation Damages

Question 1

What are expectation damages?

Answer 1

The goal of expectation damages is to put the non-breaching party in the same economic position that it would be in if the contract had been performed as promised.

Question 2

How are expectation damages measured?

Answer 2

Expectation damages are measured by comparing the value of the performance without the breach to the value of the performance with the breach.

Question 3

True or false: Expectation damages must be proven with reasonable certainty?

Answer 3

True

Question 4

Are consequential damages (like lost profits) typically recoverable?

Answer 4

Unforeseeable consequential damages are NOT recoverable UNLESS the breaching party had some reason to know about the possibility of these unforeseeable damages.

Question 5

What are general damages?

Answer 5

The type of loss that anyone would suffer from a breach. (cost of storing rejected goods, finding a new buyer, finding a replacement vendor).

Question 6

What are consequential damages?

Answer 6

The type of losses that are unique or special to this plaintiff ( losses that arise indirectly from the breach).

Question 7

How do you calculate expectation damages?

Answer 7

The nonbreaching party’s expectation damages
will equal:

• the value of the performance that the breaching party should have rendered;
• plus any incidental damages or, if recoverable, consequential damages;
• minus any losses or costs that the nonbreaching party saved, or could have saved with
  reasonable effort, by not having to perform the contract himself.