Contracts

-Supreme court of NH - highest court in NH. Written by Justice Branch, 1929. 9 years before transaction, Hawkins, male, boy at the time, burned right hand on an electrical wire. Age not stated in opinion but doctor was seeking father's content but old enough to work. Considerable quantity of scar tissue formed. evidence that Dr. McGee repeatedly asked boy's father if he could do grafting operation/wanted to "experiment" on skin grafting. Boy, Hawkins, and Dr. McGee to office visit, talked. Father asks how long boy will be in hospital, hawkins says a few days. someone testifies mr. mcgee says he gurantees to make hand 100% perfect. agreed, he performed operation - removes scar tissue gets skin from chest and applies to hand. Hawkins sues Dr. McGee, brings two claims: (1) assumpsit = assumed/undertook; a claim for breach of contract and (2) negligence (tort claim) which means he did not meet normal standards. On negligence count, nonsuit ordered with no exception (no exception means hawkins did not object and nonsuit means dismissal of case by judge)

What was said and done that gave rise to the lawsuit

Hawkins, then McGee's witnesses take the stand. lawyers argued about what judge should tell jury. judge tells jury you have to decide if there was contract or not (liability issue: is anyone liable for anything). Judge told jury they could give damages for any change for the worse (they could find he made the hand worse). judge says IF you find him liable, he is entitled to pain and suffering and ill effects of operation. jury found was contract, do not know exact amount but was >$500 awarded. Mcgee's lawyer says amount excessive, moves to set aside verdict. trial judge agrees damages excessive, gave Hawkins' lawyer option to remit anything >$500 or will set aside verdict. hawkins excepted, verdict set aside, H appeals.

Can't offer evidence in appellate court. Supreme court of N.H., Justice Branch. end result: New trial. in order to win appeal has to be legal error: judge gave wrong instruction to jury on damages. true measure is difference between value to Hawkins between a perfect hand and value of persent condition.

(1) restitution
(2) reliance
(3) expectation - applies to Hawkins v. McGee - to put plaintiff in position if contract had happened

Trial court did not try to get to perfect hand - just looked at pain and suffering (reliance). if was restitution he woul have got doctor's fee back. reliance because doctor made it worse, tring to get back to where he started (as if contract never happened).

Expectation is usually > reliance unless market conditions change for the worse. when market drops, expectation < reliance. rarely happens because promisor benefits from this and is not going to breach

Generally, reliance (ex. doc's fee and pain and suffering) > restitution (doctor's fee). expectation > reliance > restitution, usually.

NO. in this case (Hawkins v. McGee), under expectation, can't recover pain and suffering normally incident to this operation because it is putting you in place as if contract happened and if contract happened, you agreed to pain and suffering. reliance includes pain and suffering, expectation does not.

Remedy for breach of contract is expectation damages

U.S. Federal court - first circuit. agreed insurance policy did not cover breach of contract - covers malpractice, error, etc. does not include contracts to provid perfect hand. includes negligence counts, not contracts.

King's Bench, 1664. english case. renter (licensee) v. owner of iron mill (landlord). 10l = 10 pounds. 10 lbs agreed to for 6 months, landlord did not provide the mil, tenant wants damages. wants 10l. also gets "loss of stock laid in" (raw materials he bought to be processed in the mill). court gives him 500l

Defendant may argue plaintiff should pay 10l - argues value of what D did not deliver is 10l. Lessee (plaintiff) argues should get loss of stock laid in AND 10l. 10l is consistent with restitution (taking back money you gave them) - keeping 10l is unjust enrichment. 10l consistent with reliance - purpose to put promisee back in original position BUT need MORE under reliance (also put in loss of stock laid in). Is 10l consistent with expectation? - NO - does not get back because would have paid that had the contract been performed - dont get 10l back that you gave them but may get 10l back as part of lost profits.

Other claim is for "loss of stock laid in"/perhaps inventory = 500l award - 10l = 490l. Is 490l under restitution? NO, money was not received by defendant. Is 490l reliance? YES - Used extra money to invest stock thinking contract would be fulfilled. Is 490l recoverable under expectation? 490 itself is NOT expectation. expectation is what would have made in profit - invested 490l expecting to get back more money. if coudl not prove he would get more (would make a profit), then reliance >expectation.

Documents prepared by leading people in field under american legal institute, to set forward law in a particular area reflecting waht courts have done/are doing. restatement is NOT law, but persuasive authority. can cite as persuasive authority, but not bound by it