1. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14 Slide 1 Denial of Remedies for Breach of Contract Describe the election of remedies Describe the requirement to mitigate damages Explain how the statute of limitations and bankruptcy affect remedies for breach of contract LESSON 14-2 GOALS

2. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 2 HOW CAN ELECTION OF ONE REMEDY BAR USE OF ANOTHER REMEDY? (#10) An injured party must elect, or choose, a remedy when suing. They are generally mutually exclusive. (#10) If suing for specific performance, damages cannot also be recovered for the same breach since specific performance is not available when damages are adequate.

3. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 3 #10 Continued… (#10) Likewise rescission and restitution cannot be combined with damages, except in breach of contract for the sale of goods under the UCC. (#10) Neither can restitution and specific damages be combined since they’re basically opposites.

4. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 4 HOW CAN ELECTION OF ONE REMEDY BAR USE OF ANOTHER REMEDY? (#5) Remedies are generally mutually exclusive, so an injured party must elect the remedy to pursue.

5. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 5 What’s Your Verdict? What remedies are available to the Denver team?

6. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 6 HOW CAN FAILURE TO MITIGATE DAMAGES ELIMINATE REMEDIES? Mitigate damages is the act to minimize one’s injury. (#11) An injured party in a contract must usually take reasonable steps to minimize one’s injury. Failure to do so will eliminate or dramatically reduce the available damages.

7. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 7 HOW CAN FAILURE TO MITIGATE DAMAGES ELIMINATE REMEDIES? (#6) A landlord must take reasonable steps to rent the property to minimize the landlord’s loss from the breaking of the lease or the landlord may not recover the entire loss.

8. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 8 What’s Your Verdict? Has DeChant’s failure to seek comparable employment eliminated his ability to recover from Allente?

9. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 9 HOW CAN WAIVER ELIMINATE REMEDIES? Waiver is when a party intentionally and explicitly gives up a contractual right. (#7) A waiver may be intentionally or explicitly given or it may be implied from conduct.

10. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 10 What’s Your Verdict? Has her failure to act within one year been a waiver of her right to claim a breach of warranty?

11. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 11 HOW CAN THE STATUTE OF LIMITATIONS ELIMINATE REMEDIES? Statutes of limitations is state statutes in that deny any remedy if suit is not commenced within a certain time after a legal claim arises. Four years is a common time for the statute of limitations for contracts. (#8) An injured party in a breach must pursue remedy in a timely manner, within the statue of limitations for the injury, or the statute will limit the suit.

12. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 12 HOW CAN THE STATUTE OF LIMITATIONS ELIMINATE REMEDIES? (#12, Part 1 of 2) The statute of limitations makes it necessary to file suit within a certain time after a legal claim arises. After the statutory period, no remedy is available.

13. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 13 What’s Your Verdict? Will the court consider the claim even though it is six years old?

14. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 14 HOW CAN BANKRUPTCY ELIMINATE REMEDIES? Bankruptcy is a legal proceeding whereby a debtor’s assets are distributed among his or her creditors to discharge debts. (#12, Part 2 of 2) Bankruptcy limits damages to the distribution in the bankruptcy agreement and discharges all remaining debt, so no additional remedy would be available from a party who has filed bankruptcy.

15. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 15 HOW CAN BANKRUPTCY ELIMINATE REMEDIES? (#9) In bankruptcy, the assets of the debtor are distributed to the creditors and debts are cancelled, allowing the individual a fresh start. Creditors cannot initiate suits for damages because contracts have been dismissed by the bankruptcy agreement.

16. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 16 REMEDIES FOR BREACH OF CONTRACT ConsequentialCompensatoryLiquidatedPunitiveNominal Rescission and Restitution Damages Specific Performance InjunctionWaiver Breach of Contract

17. LAW FOR BUSINESS AND PERSONAL USE © SOUTH-WESTERN PUBLISHING Chapter 14Slide 17 What’s Your Verdict? Is there anything he can legally do to get rid of his debts?