Description
This assignment supports the following lesson objectives:
Review the principles of remedies for breach of contract.
Assignment Overview
This writing assignment explores possible remedies for breach of contract.
Deliverables
2-page report (approx. 500 words)
Activity Details
Perform the following tasks:
Step 1: Read several scenarios.
Click her her – Alternative Formats e to access the “Cases 4” handout.
Step 2: Write responses to the following questions:
Use a word processor (like MS Word) to write a paper answering the following questions:
Case 16.1: Is the liquidated damage clause enforceable?
Case 16.2: Can C&H recover the liquidated damages from Sun Ship?
Case 16.3: Did Microform materially breach the contract? Can Hawaiian Telephone recover damages?
Case 16.4: Can Gundersons recover these lost profits as damages?
Case 16.5: Is specific performance an appropriate remedy in this case?
Case 16.6: Is an injunction an appropriate remedy in this case?
Case 16.1: Contemporary Environment: Liquidated Damages Awarded for Breach
of Contract at Trump World Tower
The Uzans had placed a nonrefundable 25% deposit on four condominium units at the Trump
World Tower still under construction. They were represented by attorneys. Following the attack
on the World Trade Center, the Uzans sent a letter to the builder, rescinding their purchases. 845
UN, the builder, sent them default letters giving them 30 days to sure, after which the purchase
agreements were terminated and the deposit retained by 645 UN. The Uzans sued, alleging that
the nonrefundable deposit, which was clearly stated in the contract, was unenforceable and an
unconscionable penalty, while 845 UN claimed that it was a liquidated damage clause and
enforceable.
The Supreme Court of New York sided with 845 UN, as it was a specifically negotiated element
of the contract. Both sides had been represented by attorneys, who had spent two months coming
to agreement on the terms.
Sophisticated persons should be held to the terms of their agreements. It was unethical for the
Uzans to try to get out of their contracts, and 845 UN was correct in holding them to it.
Case 16.2 Company v. Sun Ship, Inc., 794 F.2d 1433, Web 1986 U.S. App. Lexis 27376
(United States Court of Appeals for the Ninth Circuit)
Case 16.3 Hawaiian Telephone Co. v. Microform Data Systems Inc., 829 F.2d 919, Web
1987 U.S.App. Lexis
13425 (United States Court of Appeals for the Ninth Circuit).
Case 16.4 Gundersons, Inc. v. Ptarmigan Investment Company, 678 P.2d 1061, Web 1983
Colo.
App. Lexis 1133
(Court of Appeals of Colorado).
Case 16.5
Liz Claiborne, Inc. v. Avon Products, Inc., 141 A.D.2d 329, 530 N.Y.S.2d 425, Web 1988 N.Y.
App.
Div. Lexis 6423 (Supreme Court of New York).
Case 16.6
Beverly Glen Music, Inc. v. Warner Communications, Inc., 178 Cal.App.3d 1142, 224 Cal.Rptr.
260, Web 1986 Cal.App. Lexis 2729 (Court of Appeal of California).
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