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Contracts • Remedies for Unexcused Non-Performance
K#162
Legal Definition
Consequential damages may be recovered only by the non-breaching buyer, and must be foreseeable. Damages are limited to those arising from the plaintiff's unique circumstances, and to situations in which the defendant had a reason to know of these unique circumstances at the time of contracting.
Plain English Explanation
When potential damages are foreseeable and can predictably happen as a consequence of breach, the non-breaching party has a right to pursue them in court.
Hypothetical
Hypo 1: Sam owns an ice cream store. On the day he receives a full shipment of ice cream, his large industrial freezer breaks down. Bob is a freezer salesman. Sam calls Bob and orders a freezer. Sam explains his emergency, and Bob recommends that Sam pay extra for same-day delivery. Sam agrees. Unfortunately, the freezer doesn't arrive for 5 days. All of Sam's ice cream has melted. Result: Sam can sue Bob for the consequential damages of his ice cream that melted because it was foreseeable that if Bob didn't replace the freezer immediately, Sam's broken freezer would be insufficient to keep his ice cream from melting.
Visual Aids
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