110 likes | 375 Views
Specific Performance & Irreparable Injury. Specific Performance = specialized form of an injunction where P asks the court to order D to perform her obligations under the contract. Irreparable injury is a threshold issue here too
E N D
Specific Performance & Irreparable Injury • Specific Performance = specialized form of an injunction where P asks the court to order D to perform her obligations under the contract. • Irreparable injury is a threshold issue here too • Ways to show irreparable injury in specific performance context when contract involves consumer goods: • Unique goods • Basic consumer goods • Shortage • Time is of the Essence • Unique contractual requirements (size of contract/number of goods)
Efficient Breach & Specific Performance • Some observers also argue that courts should NOT order specific performance because it interferes w/ “efficient” breach of contract • 3d party willing to pay $90 on spot market may have a more valuable use for carrots than Campbell which was only willing to pay $30 • OR Wentzes have found a buyer willing to pay $95. After Wentzes pay damages of $60 ($90-$30), they make a $5 profit, which is a better use of the carrots because it is more profitable • Scholars argue over whether such efficient breach should be allowed (and specific performance disallowed) • Most of the disagreement focuses on (1) whether price adequately reflects value, (2) whether damages/SP have higher transaction costs, and (3) whether damages really adequately compensate P’s damage • For your purposes: • Issue of efficient breach arises primarily in times of market distortion • This is when courts are MOST likely to order specific performance
Why can’t P always get specific performance when contracts are breached? • If damages and specific performance are usually equivalent, why don’t courts allow SP and damages interchangeably (i.e., why have an irreparable injury requirement)? • Are there reasons why courts might be reluctant to order specific performance short of impossibility or “extremely-difficult-to” cover situations?
Van Wagner – Difficulty in Valuing Damages & Specific Performance • Was the land subject to the rental contract in Van Wagner unique? • Why did the court refuse to grant specific performance? • Is Van Wagner’s reasoning consistent with the courts’ treatment of irreparable injury in Campbell Soup or Pardee?
Difficulty in Valuation & Irreparable Injury • One important factor re whether P has shown irreparable injury is that damages are hard to value. • This factor is a corollary to uniqueness – “That which is hard to replace is usually difficult to value.” • Just because difficulty of valuation is a consideration re irreparable injury, however, DOESN’T mean it is the only way to show irreparable injury. • What else might have caused the court to deny the injunction?
Balancing the Equities/Undue Hardship to the Defendant Even if P can show irreparable injury a court may still deny an injunction if hardship on D is too significant Court must ask whether: hardship on D of granting the injunction disproportionately outweighs hardship on P of not granting the injunction (aka benefit to plaintiff of granting the injunction)
Balancing of Equities/Undue Hardship, cont’d • This is a defense = must be raised by D or it’s waived. • How to give content to this test? • What kinds of harm to P if injunction is not granted (or what benefit to P if it is granted) does court weigh in the balance? • What kinds of harm to D if injunction granted does court typically weigh in the balance?
Balancing the Equities in Whitlock • Does the burden to the D (Hilander) if the injunction is granted disproportionately outweigh burden on P (Whitlock) if injunction is not granted (or benefit if granted)? • What is harm to D if granted? • What is harm to P if not granted? • Why doesn’t appellate court uphold lower court’s REFUSAL to grant injunction?
To what extent should D’s culpability factor into the court’s balancing of equities? • How should courts deal with D’s culpability during the balancing? • Should it matter that D acted intentionally if D’s harm from granting the injunction is disproportionate to P’s harm? • What outcome in Whitlock ifD didn’t know the addition was over the property boundary but also didn’t bother to check?
To what extent does P’s culpability weigh in the balancing? • If P does something to aggravate the situation, courts can weigh P’s actions in the balance as well. • Example – if P refused to allow surveyors on land to find out where lot lines between P & D’s land were • To what extent is D trying to argue that P (Whitlock) has acted in a manner so as to be undeserving of relief? • P’s claim is barred by laches • The Doctrine of Laches: Equity aids the vigilant, not those who sleep on their rights. • Courts deny relief if • P’s neglect to assert a right or claim • Together with the passage of time or other circumstances • Substantially prejudices D • Do P’s actions fit this definition?
Comparing Whitlock & Boomer Plaintiff’s harm: Defendant’s harm: Defendant’s culpability: Plaintiff’s culpability: