Friday Florida Law Update- Contract Damages
TGIF all, and what a gorgeous Friday it is for South Floridians! Today we discuss a case involving damages for a breach of a commercial contract, but more importantly, a case which kicks off with a snide but humorous comment from the appellate court.
In Net Results, Inc v. Del Monte Fresh Produce Co., 2011 WL 4949872 (Fla. 3d DCA Oct. 19, 2011), Net Results sued over Del Monte’s wrongful termination of a telecommunications consulting contract. Under the contract, Net Results was required to examine Del Monte’s telecommunications expenses and scope out means to save money. Del Monte terminated the agreement on the belief that Net Results had not fully performed under the contract. At the trial court level, a jury found that Del Monte wrongfully terminated the agreement, and awarded damages of $15.7 million.
In reversing and remanding the case on the issue of damages only, the Third DCA opened with the comment that “[t]his is a business damages case in which the computation of Net Results’ ‘benefit of the bargain’ losses require grade-school arithmetic rather than a ‘damages model’ long on assumptions and short on facts.”
The overly complex damage calculation attempted indeed extrapolated significant hypothetical performance in the future but overlooked simple issues like Net Results’ operating expenses for performance under the contract. In remanding the case for a new trial on damages only, the Third DCA emphasized the concept of “benefit of the bargain” damages, which essentially places the parties back in the position they would have been in if Del Monte had not repudiated the agreement, including all operating expenses.
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