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75 Cards in this Set

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How to Spot a Remedies Question
1. The call of the question line

- “remedies”

- “relief”

- State a specific remedy

2. Most relevant areas are torts and contracts and related property areas
How to Approach a Remedies Question
1. Determine what substantive area of law is involved

- What specific type of problem is at issue with that substantive area

2. Make sure that plaintiff has a case, e.g. a tort committed, a contract breached

3. Determine what remedies require discussion

- Discuss in this order because you cannot get equitable remedy if legal remedy is available and adequate

i. Legal Remedies

ii. Restitutionary Remedies (Legal/Equitable)

iii. Equitable Remedies
Available Tort Remedies (Short)
1. Legal: Damages
i. Compensatory
ii. Nominal
iii. Punitive

2. Restitutionary

i. Legal
- Restitutionary Damages
- Replevin
- Ejectment

ii. Equitable
- Constructive Trust
- Equitable Lien

3. Equitable: Injunctive Relief
Compensatory Damages (basic definition)
Put injured party in the position he would have been in had the injury not occurred
Compensatory Damages (four requirements)

$$$$$
1. Causation (but for test)

2. Foreseeability (proximate causation)

3. Certainty (damages cannot be too speculative)

4. Unavoidability (REASONABLE STEPS to mitigate)
Certainty (compensatory damages in tort)
1. Damages cannot be too speculative

i. Past losses have to be established with more certainty than future losses

ii. Historical records help to provide certainty (i.e. old v. new business)

iii. For future damages, plaintiff must show that they are more likely to happen than not. (ALL OR NOTHING)

2. Personal Injury Torts

i. Economic Losses (Special Damages)

- Basic certainty rules apply

- Medical expenses, lost earnings, etc.

ii. Non-economic Losses (General Damages)

- Basic certainty rules do not apply. Jury may award any amount it wishes

- Pain and suffering, etc.
Personal Injury Form of Judgment Payment
Award must be a single lump sum payment, discounted to present value. Inflation is not taken into account.
Nominal Damages
Awarded where plaintiff has no actual injury. Serves to establish or vindicate the plaintiff’s rights
Punitive Damages
Awarded to punish the defendant

1. Plaintiff must first have been awarded compensatory or nominal damages

- Punitive damages can also be attached to restitutionary damages if underlying cause of action is a tort

2. Defendant’s type of fault must be greater than negligence

3. Generally, punitive damages are awarded in an amount relatively proportionate to actual damages.

- Single-digit multiple of actual damages unless conduct facts are extreme
Restitutionary (basic definition)
Based on the theory that defendant should not be UNJUSTLY ENRICHED.
Restitutionary Damages (aka Quasi-Contract)
- Legal

- Based on the benefit to the defendant. Amount is calculated based on value of the benefit.

- Cannot award both compensatory and restitutionary damages.

- Argue both if both apply, and give plaintiff the larger amount
Replevin
1. Plaintiff recovers possession of specific personal property (restitutionary, legal)

- Defendant does not have title

2. Two Part Test

i. Plaintiff has right to possession

ii. Wrongful withholding by defendant

3. Timing ( Plaintiff can recover the chattel before the trial)

i. Plaintiff must post a bond

- Damages to defendant is replevin was in error

ii. Defendant can defeat an immediate recovery by posting a redelivery bond

- Defendant can then keep the chattel until after the trial

iii. Sheriff repossesses the property for plaintiff

4. Replevin is almost always coupled with damages for loss of use or benefit to defendant during the time of detention
Defect in Purchase Price
Abatement(lower) in the purchase price when specific performance
Ejectment
1. Plaintiff recovers possession of specific real property (resitutionary, legal)

- Defendant does not have title

2. Two Part Test

i. Plaintiff has right to possession

ii. Wrongful withholding by defendant

- Defendant must be in possession of property (not just trespassing)

3. Ejectment is almost always coupled with damages for loss of use or benefit to defendant during the time of detention
Constructive Trust
Imposed on improperly acquired property to which defendant has title. (restitutionary, equitable)

- Defendant serves as trustee and must return the property to the plaintiff
Equitable Lien
1. Imposed on improperly acquired property to which defendant has title (restitutionary, equitable)

2. Property will be subject to an immediate court-directed sale

3. Monies received go to plaintiff

- If proceeds of sale are less than the FMV of property when it was taken, a DEFICEINCY JUDGMENT will issue for difference
Rules for Constructive Trusts and Equitable Liens
TITLE!!!!!!!!!!!!

1. Inadequate legal remedy

i. Alternative – damages

ii. Reasons (D insolvent; Property unique- ct)

2. Tracing is allowed

3. BFPs prevail over plaintiff (proceeds of that sale can be traced)

4. Plaintiff prevails over unsecured creditors

5. Choice of remedy

i. Constructive Trust: If property value subsequent to taking goes up

ii. Equitable Lien

- If property value subsequent to taking goes down

- Defendant’s property cannot be traced solely to plaintiff’s property
Injunctive Relief
Equitable Relief

Defendant is ordered (enjoined) to do or refrain from doing something

Threshold inquiry

1. Permanent injunction – issued after full trial on the merits

2. Temporary injunction – issued pending trial on merits

Almost always coupled with money damages!!!!!!!!
Temporary Injunctive Relief
Two Part Test

1. Establish that there is irreparable injury

i. Facts must be discussed in a time frame context – imminent

ii. Irreparable injury is weighed against any hardship defendant will suffer

2. Establish plaintiff’s likelihood of success (probability)

- Plaintiff must post a bond
Temporary Restraining Order
1. Issued pending a hearing to determine whether temporary injunction should issue

2. Identical test used

3. TRO proceeding can be ex parte

i. Notice not required

ii. Adversarial proceeding not required

4. Limited to 10 days
Permanent Injunctive Relief ( five basic parts)
1. Inadequate legal remedy alternative

2. Property Interest/Protectable Right

3. Feasibility of Enforcement

4. Balancing of Hardships

5. Defenses
Inadequate Legal Remedy Alternative (Permanent Injunctive Relief)
1. Alternative – Replevin

i. Sheriff may not be able to recover it

ii. Defendant can file a redelivery bond

2. Alternative – Ejectment: Sheriff may refuse to act

3. Alternative – Money Damages

i. Too speculative

ii. No right to money damages because tort is only threatened, not yet committed

iii. Defendant is insolvent

iv. Irreparable injury (Unique property)

v. Avoiding a multiplicity of suits (prior lit. btwn parties relating to this type of action)
Property Right/Protectable Interest Requirement (Permanent Injunctive Relief)
Traditional rule – equity will grant relief only where a protectable property right is involved

Modern trend – a protectable interest will suffice
Feasibility of Enforcement (Permanent Injunctive Relief)
Two Types of Injunctions

1. Negative – stop doing something

2. Mandatory (Affirmative) – do something

Rules

1. Negative injunctions have no enforcement problems

2. Mandatory injunctions may have enforcement problems based on

i. Difficulty of supervision

ii. Concern with effectively ensuring compliance

3. Examples

i. Act involves application of great taste, skill or judgment (inj. denied)

ii. Series of acts over a period of time (inj. denied unless P’s case is otherwise great)

iii. Out-of-state act required

- Resident defendant – injunction granted

- Non-resident defendant – injunction denied
Balancing of Hardships (Permanent Injunctive Relief)
Plaintiff’s benefit v. Defendant’s hardship if relief granted

Rules

1. There must be a gross disparity between detriment and benefit

2. No balancing if defendant’s conduct was willful

3. If you balance hardships, consider awarding plaintiff money damages

4. Hardship to public is also taken into account

i. First discuss defendant’s hardship

ii. Discuss public’s hardship

iii. Deny injunction and award plaintiff money damages
Insolvent Defendant
Write about Constructive Trust

Inadequate legal remedy because can't get money damages
Defenses (Permanent Injunctive Relief)
1. Unclean Hands

2. Laches

3. Impossibility

4. Free Speech
Unclean hands
Available only if plaintiff’s alleged improper conduct is related to the lawsuit

No generalized “bad guy” plaintiff
Laches
1. Concerned with the effect of passage of time

2. Never be greater than statute of limitations

3. Rules

i. Clock starts to run when plaintiff knows of the injury

ii. Relief is cut off when delay was both unreasonable and prejudicial to defendant

iii. If laches applies, consider awarding plaintiff money damages
Problems w/ Injunctive Relief
1. Crimes: Equity will not enjoin crimes

2. Who is bound

i. Parties

ii. Employees and agents acting with notice

iii. Third persons acting with notice

3. Erroneous injunction: Must still obey erroneous injunction until it is modified or dissolved

4. Contempt: Disobeyance of court order

i. Civil contempt (to coerce)

- Money fine

- Imprisonment – defendant can get out by agreeing to comply

ii. Criminal contempt (to punish)

- Money fine

- Imprisonment – remain for set amount of time

- Constitutional safeguards apply
Destroyed Property (potentially available remedies in tort)
Compensatory damages
Damaged Property (potentially available remedies in tort)
Compensatory damages
Dispossession (potentially available remedies in tort)
1. Compensatory damages

2. Restitutionary damages (if defendant benefits)

3. Replevin

4. Mandatory injunction (if chattel unique and damages and replevin won’t work)

5. Constructive trust/Equitable lien (particularly if D is insolvent and/or tracing involved)

6. Self-help (reasonable force to recapture)
Simple Trespass (potentially available remedies in tort)
1. Nominal damages

2. Restitutionary damages

3. Injunction (avoiding multiplicity of suits )
Destruction/Damage of Realty (potentially available remedies in tort)
1. Compensatory damages

2. Injunction
Dispossession (potentially available remedies in tort)
1. Compensatory damages

2. Restitutionary damages

3. Ejectment

4. Constructive Trusts/Equitable Liens
Encroachment (potentially available remedies in tort)
BOTH

1. Compensatory damages

2. Injunction (emphasize balancing of hardships )

- Write that there is never restitution
Nuisance (potentially available remedies in tort)
BOTH

1. Compensatory damages

2. Injunction (emphasize balancing of hardships )

- Write that there is never restitution
Personal Injury Torts (potentially available remedies)
1. Compensatory damages

i. Economic losses (special damages) – certainty rules apply

ii. Non-economic losses (general damages) – certainty rules do not apply

iii. Lump sum payment discounted to present value. Inflation not taken into account

2. Injunction

- Only against prospective intentional tortious conduct
Fraud (potentially available remedies in tort)
Always discuss both tort and K and think about punitive damages

1. Damages

2. Constructive trusts/Equitable liens
Available Contract Remedies (short)
1. Legal: Damages
i. Compensatory (including consequential)
ii. Nominal
iii. Liquidated

2. Restitutionary

i. Legal
- Restitutionary Damages
- Replevin
- Ejectment

ii. Equitable
- Constructive Trust
- Equitable Lien

3. Equitable
i. Specific Performance
ii. Rescission
iii. Reformation
Consequential Damages
Subset of Compensatory Damages

Reasonably foreseeable at time of K formation
Punitive Damages in Contract
Not allowed

If conduct is willful, try to characterize as a tort
Liquidated Damages Clause
1. Two Part Test for Validity

i. Damages are very difficult to ascertain at time of contract formation

ii. Reasonable forecast of what they would be

2. Clause cannot state that you get either actual or liquidated - invalid
Restitutionary relief in Contract
Based on the theory that defendant should not be unjustly enriched

Contract “fails” after plaintiff has rendered performance (partial or complete)

Includes:

1. Unenforceable Contracts

2. Breached Contracts
Unenforceable Contracts
1. Contract is unenforceable due to mistake, lack of capacity, statute of frauds, illegality, etc.

2. Plaintiff can get restitutionary damages for property/money given to, or services rendered for, defendant at the value of the benefit

- It is not necessary to find that defendant has benefited, just that they received a benefit, whether or not they used it

3. Plaintiff can recover value of services even if it is greater than contract rate

4. Plaintiff can recover property if unique or defendant insolvent
Breached Contracts
1. Plaintiff as Non-Breaching Party

i. Plaintiff can get restitutionary damages for property/money given to, or services rendered for, defendant at the value of the benefit

ii. Plaintiff can recover value of services even if it is greater than contract rate

iii. Plaintiff can recover property if unique or defendant insolvent

2. Plaintiff as Breaching Party

i. Traditional view – no recovery

ii. Modern view – recovery allowed

- Cannot be greater than contract rate and is reduced by any damages suffered by defendant (non-breaching party) as a result of the breach
Specific Performance (Basic Requirements)
Defendant required to perform the contract

1.Contract valid

1.5 Contract conditions of plaintiff must be satisfied

2. Terms of the K are definite and specific

3.Inadequate legal remedy

4.Mutuality of Remedy

5.Defenses
Contract Conditions of Plaintiff Must be Satisfied (Specific Performance)
1. Plaintiff must be able to show his contract conditions have been fulfilled

i. Already performed

ii. Ready and able

iii. Excused from performing

2. Deficiencies

i. Seller cannot deliver the agreed upon consideration

ii. Seller as Plaintiff can enforce contract if defect is

- Minor

- Major only if seller can cure before or at closing

iii. Buyer as Plaintiff can enforce contract even if defect is major, unless very major

- Abatement in purchase price to take into account defect in consideration

3.Time of the Essence Clause
Time of the Essence Clause
Specific Performance: K conditions of P must be satisfied

1. Buyer does not meet contract condition of timely performance

2. Facts

i. Land sale contract

ii. Contract will contain express time of the essence clause

iii. Clause will contain a forfeiture provision (forfeiture of all performance rendered to date if not timely)

iv. Partial performance which is potentially subject to forfeiture

v. Buyer will make a late payment

3. Seller wants to keep both land and any performance rendered to date, buyer will bring lawsuit for specific performance

4. Equitable maxim – equity abhors forfeitures

5. Factors

i. Loss to seller is small

ii. Tardiness is de minimis

iii. Waiver (seller has accepted late payments before)

iv. Buyer would suffer undue hardship
Inadequate Legal Remedy (Specific Performance)
Alternative – Money Damages

1. Damages are speculative

2. Defendant is insolvent

3. Multiple suits are necessary

4.. Thing bargained for is unique

Liquidated damages clause does not make money damages adequate

1. Specific Performance is still available

2. Exception: clause provides that this is “exclusive” or “only” remedy
Uniqueness Problem (Specific Performance)
1. Tested at time of litigation

2. If the property is unique, then even if plaintiff received money damages, he could not simply go out and buy it

3. Real property

i. Land is unique

ii. Seller can get specific performance even though all they have coming is money

4. Personal Property, usually not unique but some exceptions:

i. One of a kind or very rare

ii. Personal significance to buyer

iii. Circumstances make chattel unique (shortage)
Mutuality of Remedy (Specific Performance)
1. Defendant argues that plaintiff should not be able to enforce contract against him because he could not enforce against plaintiff

- Plaintiff is someone who lacks capacity

2. Rule - Court will reject the mutuality argument if it feels secure that plaintiff can and will perform

- Grant specific performance and provide for simultaneous performance
I put five bucks down
Permanent Injunctive Relief

- Inadequate legal remedy
- Property interest/Protectable Interest
- Feasibility of enforcement
- Balancing of Hardships
- Defenses
Two sets of question for Tort problems
1. Has plaintiff been injured?
2. Has defendant derived a benefit?
3. Does plaintiff want property returned?
4. Does plaintiff need an injunction?

1. Do the wrongs relate to the past only?
2. Do the wrongs relate to the future only?
3. Do the wrongs relate to both the past and the future?
Defenses to Specific Performance
Equitable Defensese

1. Unclean Hands
2. Laches
3. Unconconscionability (tested at time of K formation)

Contract Defenses

1. Mistake
2. Misrepresentation
3. Statute of Frauds
Statute of Frauds with part performance
1. Contract involves land and will have been oral

2. Rule – if one has rendered valuable part performance in reliance on the contract, this will take the case out of the Statute of Frauds and specific performance will be granted (two of three)

i. Payment (in whole or part)

ii. Possession

iii. Valuable improvements
Two Problems with Specific Performance
1. Equitable Conversion

2. Personal Service Contracts
Equitable Conversion (Specific Performance)
1. Is land sale contract specifically enforceable?

i. Yes – equitable conversion occurred upon execution

- Property interests of the buyer and seller were switched

- Buyer has real property interest (specifically enforceable right to land)

- Seller has personal property interest (specifically enforceable right to money )

2. Death prior to closing

3. Damage and Destruction

i. Risk of Loss

- Majority rule – risk on buyer

- Modern trend – risk on seller
Personal Services Contracts (Specific Performance)
1. Personal Service Contracts

- Not specifically enforceable (enforcement problem; involuntary servitude)

2. Covenants not to Compete

- Two Part Test for Validity

i. Covenant must protect a legitimate interest of the person in whose favor it runs. Services must be unique

ii. Covenant must be reasonable in both geographical and durational scope
Rescission
Equitable Remedy in K

Original contract is considered voidable and rescinded

Grounds for Rescission

1. Mistake, misrepresentation, coercion, undue influence, lack of capacity, failure of consideration, illegality (never validly formed in the first place )

2.Mutual Mistake

i. Material Fact – rescission granted

ii. Collateral Fact – rescission denied

- Quality, desirability, fitness of property for particular purpose

3. Unilateral Mistake

- Rescission usually denied unless non-mistaken party knew or should have known of the mistake

4. Misrepresentation

- In order to get rescission, the plaintiff must show that they have actually relied upon the misrepresentation
Valid Defenses to Rescission
1. Unclean hands

2. Laches

Negligence of plaintiff is not a defense
Problems w/ Recission
1. Election of Remedies

i. Plaintiff sues for damages first rescission is not allowed

ii.. Suing for damages first affirms the contract

- Plaintiff sues for rescission first damages are allowed

iii. Plaintiff can sue for both at the same time, but must elect the preferred remedy before judgment

2. Availability of Restitution

- If a plaintiff who is entitled to rescission has previously rendered performance on the contract, he can get compensated for it or get the property back via restitution

3. Legal Rescission

i. Plaintiff gives notice and tenders back any consideration received

ii. Plaintiff then sues for restitution for anything given to defendant
Reformation
Equitable Remedy in K

- Changes written agreement to conform with the parties original understanding

Three Part Test

1. Valid contract

2. Grounds for Reformation

i. Mutual Mistake

ii. Unilateral Mistake where non-mistaken party knew of mistake

iii. Misrepresentation (both innocent and intentional)

3. Valid Defenses

i.. Unclean hands

ii. Laches

4. Non-defenses

i. Negligence of plaintiff

ii. Statute of Frauds

iii. Parol Evidence Rule
Cha Cha Is My Dance
Specific Perfmormance

- Contract must be valid
- Condition of P satisfied
- Inadequate legal remedy
- Mutuality of remedy
- Defenses
Personal Property (potentially available remedies in K)
1. Compensatory Damages

i. Seller’s breach – does not convey, delivers damaged goods

ii. Buyer’s breach – does not pay

2. Restitution

3. Specific Performance

4. Rescission

5. Reformation
Real Property (potentially available remedies in K)
1. Compensatory Damages

i. Seller’s breach – does not convey

ii. Buyer’s breach – does not pay

2. Restitution

3. Specific Performance

i. Land is unique

ii. Both buyer and seller can get

4. Rescission

5. Reformation
Construction Contracts (potentially available remedies in K)
1. Compensatory Damages

i. Owner’s breach – does not pay

ii. Builder’s breach – non-completion, defective completion

2. Restitution

i. Only builder for work done, unless owner pre-paid

3. Specific Performance: only owner, but enforcement problems
Personal Services Contracts (potentially available remedies in K)
1. Compensatory Damages

i. Employer’s breach – wrongfully terminates

ii. Employee’s breach – wrongfully quits

2. Restitution: only employee for services rendered, unless employer pre-paid

3. Specific Performance: valid covenant not to compete
Good Dog

Very Good Dog
Rescission
- Grounds
- Defenses

Reformaiton
- Valid K
- Grounds
- Defenses
Questions for Contract Problem
1. Has plaintiff been injured?

2. Has defendant derived a benefit?

3. Does the plaintiff wants his property back?

4. Does plaintiff want the contract reformed?

5. Does plaintiff want the contract ripped up?

6. Does plaintiff want the contract rewritten?
Tracing: recovering where money has been spent
Lowest intermediate balance unless minority replenishment theory
Damages in landsale contracts
Traditional common law: out of pocket expenses (downpayment, cost of title search, etc)

Other jurisdictions: benefit-of-the-bargain = market price - K price
When they want a preliminary injunction
Discuss:

1) Likelihood of success on the merits (there is always a sub-issue here such as breach of K, anticipatory repudiation, etc.)

2) Balance the Hardships (remember to do, but ignore if conduct is wilful)

3) Necessity to maintain status quo
Modern trend for mutuality of remedy
Mutuality of Performance