Book Opener

contract discharged. This is often the best choice, especially if no damageshave been suffered. Damages awarded to recognize a breach ofcontract that did not cause loss often amount to less than one dollar.These damages are intended merely to recognize that a breach of contracthas occurred. Your legal fees for pursuing and winning such a suitwould likely far outweigh any damages you would receive.Money DamagesIf you suffer a loss as the injured party, however, you may sue formoney damages resulting from the breach of contract. Damages arepayment recovered in court by a person who has suffered an injury (seeFigure 12.3). The money damages should, by law, place you in the positionyou would have been in if the contract had been carried out. Let’stake a closer look at some selected categories of damages. To recoverdamages, the injured party must make tender; that is, the injured partymust offer to do what he or she agreed to do under the contract.Actual and Incidental DamagesIn actions for breach of contract, the injured party may recover theactual damages caused by the other party’s failure of performance.Actual damages are damages directly attributable to another party’sbreach of contract. For instance, if someone contracts to buy land at acertain price but the contract is breached, he or she can seek damagesamounting to the difference between the agreed price of the land and itsmarket value at the time of the breach. If a seller of goods breaches acontract, the measure of damages for the prospective buyer is the differencebetween the market price at the time of the breach and the contractprice, plus incidental damages. Incidental damages are anyreasonable expenses, resulting from a breach, that have been incurredby the buyer.HistoryIn the book of Exodus inthe Old Testament, manyof the old Hebrew lawsare cited. One states,“Wherever hurt is done,you shall give life for life,eye for eye, tooth fortooth, hand for hand, footfor foot, burn for burn,bruise for bruise, woundfor wound.” (Exodus21:23–25, The NewEnglish Bible)Research ActivityToday, we award moneydamages. Research alawsuit in which acontract has beenbreached and moneydamages have beenawarded. Make an oralpresentation to your classoutlining the case andwhether you believe theaward was sufficient.Example 12. Yukio Tanaka contracted with a local bookstore tobuy a set of encyclopedias at a price of $1,500. The store failedto deliver the books according to the agreement. Tanaka learnedthat he would have to pay $1,800 to buy the same set of books atanother store across town. He is entitled to sue the first store forhis actual damage of $300, which is the difference between$1,500 and $1,800, plus any other expenses incurred in gettingthe books at the other bookstore. These incidental damages mightinclude transportation or delivery costs.Liquidated DamagesDamages agreed upon by the parties when they first enter into acontract are called liquidated damages . The parties agree beforehandChapter 12: Transfer of Contracts and Remedies for Breach 251