American Contract Law for a Global Age, 2017a

car to the Country Music Museum for $1,000,001. Elmer returns Titus’s check. Titus
subsequently sues Elmer. As the car has already been conveyed to the Museum,
Titus’s only remedy is damages. What damages can he collect from Elmer? Work
through each of the three categories. Which one would he be advised to seek?
Expectancy damages:
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Restitution damages:
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Reliance damages:
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Problem 24.2
Back in Unit 9, which covered promissory estoppel, you read the case of
Hoffman v. Red Owl Stores, Inc. There, Joseph Hoffman had extensive, multi-year
negotiations about obtaining a Red Owl grocery store franchise. The two sides never
signed a final contract, but Hoffman sold his bakery, bought a small grocery store to
gain experience, and engaged in other transactions in the midst of representations
made by Red Owl during the negotiations. Hoffman never received a Red Owl
franchise, and he sued Red Owl. While the parties had no contract, the Wisconsin
Supreme Court held that Hoffman could recover based on promissory estoppel. With
regard to damages, the court said “it would be a mistake to regard an action grounded
on promissory estoppel as the equivalent of a breach of contract action” that allowed
for recovery of expectancy damages. Instead damages must be based on reliance, and
even reliance damages could be allowed only to the extent that injustice could be
avoided. The case was then remanded to the trial court for a new trial on the issue of
damages.
You are a clerk working for the trial judge in Hoffman upon its remand.
Assume for purposes of this problem that Hoffman is seeking from Red Owl Stores
the categories of damages listed below (which, incidentally, are not the same as those
in the real-life case). The judge has asked you to determine whether each type of
qualifies as expectancy, restitution, or reliance damages, given that only reliance
damages will likely be recoverable. If you think you need more information to answer
any of the questions, you should identify the information.
(a) Expected future profits from Hoffman’s bakery, which he sold upon the
recommendation of Red Owl.
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518 CHAPTER VIII: REMEDIES