- Damages are measured in terms of what non-breaching party should have gotten from the contract had it been performed as promised.
- Moves P where promised to be.
- Provides damages to non-breaching party by returning to the breaching party whatever benefit the breaching party received from the contract.
- Moves D back where he was.
- Damages are measured according to that it would take to return the non-breaching party from where they are as a result of the breach to where they were before there was a contract.
- Moves O back to where he was (before he relied on K).
- Forces D to perform under the K.
- (Rarely used)
Consideration Requirement (S 71)
- 1. Consideration as a bargained for exchange: to constitute consideration, a performance or a return promise must be bargained for.
- 2. A performance or return promise is bargained for if:
- a. it is sought by the promisor in exchange for his promise &
- b. is given by the promisee in exchange for that promise
- 3. Performance may consist of:
- a. An act other than a promise
- b. A forbearance
- c. the creation, modification, or destruction of a legal relation
- 4. May be given to the promisor or another; may be fiven by promisee to another
- There must be:
- -a benefit to the promisor OR
- -detriment to the promisee
Bargaine for Exchange
- -For consideration the promise and performance must be bargained for.
- -The promise must prompt the performance and the performance must prompt the promise.
- -Promise is sought by the promisor in exchange for his promise and is given by the promisee in exchange for that promise.
- -Provided a natural formality to channel human conduct and ensure deliberation
- -Protected & structured the important market transaction
- -Expanded legal protection by supporting the executory exchange- a promise for a promise
- -Permitte a fuller development of remedies that protected the plaintiff expectation interest.
Types of Promises Not Having Consideration that are NOT binding
- 1. Gratuitous Promises
- 2. Promises without Bargained for Exchange
- 3. Past Performance
- 4. Altruistic Pleasure
- 5. Nominal Consideration
- 6. Illusory Promises
Promises made as gifts have no consideration because the promisOR receives no benefit, as the promise is not provided in exchange for any return promise.
Kirksy v. Kirksy
- Gratuitous Promise
- -Widow moves to brother-in-laws house at his request, he then kicks her out.
- -Motive searching to see the desire of the promisOR, their benefit could not provide that brother wanted her there.
- -Should have argued that D wanted to have them, that would have been consideration
- -Altruistic Pleasure (not consideration) but peace of mind is.
- Consideration CANNOT be given for PAST performances.
- -promise must be sought in exchange for his promise OR
- -given in exchange for that promise.
- -Promise must INDUCE the other promise.
- ex: I will do X if you will do Y
Jara v. Suprema Meats, Inc.
- Father gave start up money for son's company.
- No consideration because it was done in the past.
The case of the proud grandfather
- Baby named after.
- the grandfather's promise to pay daughter to name her new son after gramps.
- They had already named the baby after gramps before he made the offer
- The grandfather's promise did not prompt their behavior.
If the plaintiff can prove that in moving she was providing defendant with peace of mind (instead of his altruistic pleasure) then it could have been found sufficient for consideration (Kirsky v. Kirsky)
- The parties to the agreements that are essentually promises of gifts frequently recite that the agreement is made "in consideration of $1 paid" or some other small sum.
- -While it is true that the law does not concern itself with the adequacy of consideration, provided that the consideration was truly bargained for, the recital of purely nominal consideration is usually an indication that there was no bargain at all, but rather a gift.
- In re Green: $1 is not consideration because it is too nominal to allow a reasonable person to conclude that it prompted behavior on the part of the promisEE.
- -Was not induced by it, not an incentive
is based on an illusory promise, which is a statement that appears to be promising something, but which in fact does not commit the promisOR to do anything at all.
- Illusory & Alternative Promises
- - A promise is not consideration if by its terms the promisOR or purported promisOR reserves a choice of alternative performance unless:
- a. Each of the alternative performances would have been consideration if it alone had been bargained for.
Omni Group v. Seattle 1st National Bank
Land buyer has way out of buying land if engineering report is not satisfactory.