Project 2: making decisions that are legal and ethical

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Learning Topic

Contract Remedies
The US legal system is a common-law system, a type of system that originated in England

after the Norman conquest of 1066 CE. The rulers of England, including William the

Conqueror and his progeny, took measures to unify the country. One of the measures they

took was to establish king’s courts, which sparked the beginning of a body of common

law, or generally applicable rules of law, throughout England and, eventually, its colonies.

Over time, the common law was brought to America through English colonization, and the

system of common law was adopted by the Founding Fathers of the United States.

In medieval English times, one could seek different remedies in different

courts. Remedies, broadly construed, are the legal method by which rights are enforced or

wrongs redressed. In medieval English times, king’s courts resolved disputes by issuing an

award of compensation to injured parties, often in the form of land, valuable property, or

money. The king’s courts eventually became known as courts of law, and the awards of

compensation, remedies at law. Remedies at law, today, are mostly issued in the form of

monetary amounts called damages, and are awarded through court orders.

It became apparent during the medieval period that there was sometimes no adequate

remedy at law available to resolve a dispute, and so, over time, chancery courts, also

known as courts of equity, were established. The remedies available in the courts of equity

(called remedies in equity or equitable remedies) were non-monetary remedies, including

specific performance, rescission, reformation, and injunction.

During the medieval period and still today, equitable remedies are typically available to

the injured party only when remedies at law (e.g., monetary damages) are inadequate for

resolving a dispute. Over time, and particularly during the nineteenth century, most states

in United States adopted rules to combine the traditional courts of law and courts of

equity, streamlining the process by making injured parties capable of seeking both

monetary and equitable remedies in the same court.

Remedies are available for victims of breach of contract. When one party to a contract

does not fulfill his or her legal obligations under the contract (“breaching the contract”),

the other party may seek a remedy, or some combination of remedies, to make the injured

party whole. Today, in the United States, the remedies available for breach of contract

include both remedies at law (damages), and equitable remedies, and in most states, these

remedies may be sought simultaneously in the same court. When there is a valid and

enforceable contract, monetary and equitable remedies may be available.

Even when there is not a valid and enforceable contract, in some cases, remedies may be

sought under other common-law theories, such as promissory estoppel, or pursuant to

theories of quasi-contract. The following decision tree explains how contract remedies

work in tandem with noncontract remedies.

Contract Remedy Decision Tree

As the decision tree shows, when there is a valid and enforceable contract, then monetary

and equitable remedies may be sought. If there is not a valid and enforceable contract,

then one should ask if a promise has been made in order to determine the appropriate

theory to use. If a promise has been made, then one may seek a remedy under the theory

of promissory estoppel. If a promise has not been made, then one may seek a remedy

under the theory of quasi-contract. If there might be a contract, but this is not certain,

then one may seek relief in the alternative (by requesting the court to determine if there is

a contract and, if so, to issue contract remedies; or, if not, to issue noncontract remedies).

Thus, even if no valid and enforceable contract exists, there is still the potential,

depending on the circumstances, for the injured party to seek remedies.

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