2

Suppose the following facts:

  • Alice contracts to buy a car from Bob for $10,000, in a negotiated and relatively simple written contract between competent parties.
  • Alice takes the car. Edit after Mowzer's answer: Assume Alice has taken full legal possession of the car, which Bob permitted based on her contractual promise to pay $10K.
  • Alice does not pay.
  • At some point thereafter, Alice crashes it or it is otherwise destroyed so the car can't be returned.
  • The destruction was not due to any negligence or tort on Bob's part nor any defect in the car.
  • Bob would rather have the $10K than have the car back anyway; that's why he sold it.
  • Bob sues Alice for breach of contract, alleging the facts above.
  • At trial, Alice does not dispute the basic facts about the contract or what happened.
  • The jury awards Bob $5,000 on his breach of contract claim.

As a second example, consider the following fact pattern (if commenters think this is sufficiently different, I can make it a separate question; otherwise it seems likely to be labeled a duplicate):

  • Downtown League (DL), a popular non-profit, hires Candace, an out-of-state singer, to perform at their gala fundraiser event for $10,000; $100 due and paid at signing and the rest due 20 days after the event.
  • Downtown League is in charge of all promotion and ticket sales; Candace only has to show up and perform.
  • The gala event doesn't sell nearly as many tickets as was anticipated, despite a last-minute push to get people to show up and buy tickets at the door. The bad weather doesn't help.
  • Candace shows up and performs for a small audience, fulfilling her part of the contract.
  • Downtown League realizes they cannot both pay Candace and have a successful fundraiser.
  • Downtown League does not pay Candace.
  • Candace sues for breach of contract and Downtown League doesn't dispute the facts above.
  • Candace sues in the jurisdiction where Downtown League is headquartered and where the event was held, to resolve any questions about jurisdiction.
  • The jury finds Downtown League to be in breach of contract.
  • The jury awards Candace $4,900 in damages on that breach of contract.

Is the jury just allowed to do that, effectively changing the price agreed to? What would happen next, if anything? Are there clear precedents/sources that bear on this?

Assume a trial court with no relevant cap (i.e. the jury could have awarded $10K or more if they wanted to).

The essence of the question is that Bob/Candace fulfilled his/her obligations under the contract, and Alice/DL did not. The juries appear to have changed what Alice/DL's obligations are under the contract (e.g. because they're sympathetic to defendants Alice/DL or because the defendants have painted plaintiffs as selfish for even trying to enforce the contract, etc.) and want to give defendants better deals than they originally signed. Can they do that, and arbitrarily change the terms of the contract after the fact? If they do, what happens next (if anything)?

  • I think you're probably after an answer you're not going to get, but I don't have time to research it right now. Suffice to say that you're conflating cost and price, I think. But let's see what answers say. – jimsug Nov 2 '15 at 0:08
  • I think your title might be misleading vis-a-vis your actual question. Is your actual question, "What limits are there on jury awards?" – Mowzer Nov 3 '15 at 2:22
  • @Mowzer not quite; that wording would indicate a question that's more about excessive verdicts. This one is wondering how much flexibility the jury has in changing the terms of a contract once one party has already fulfilled all its obligations under the contractual assumption that the other party will (or will be obligated) to do their part as well. Rather than get into details of complicated terms, I picked a very simple one which is easy to relate to and where an award of money damages is the most appropriate form of relief. – WBT Nov 3 '15 at 3:11
  • 1
    Okay. I understand. That makes sense. But another problem I have with your question are the phrases: "change the price" and "change the terms of the contract". The short answer is "No. Juries can't change contract terms." But that's not necessarily what's happening if the jury awards damages less than the amount of the contract. The contract is just one input into the damages decision and your question scenarios seem to presuppose only one interpretation of the facts as it relates to damages. i.e. Damages equals contract price. But that's not always true. – Mowzer Nov 3 '15 at 4:00
  • @Mowzer but if the key facts are agreed to - e.g. this is the contract, the amount wasn't paid, and the party expecting payment fulfilled his/her obligations under the contract - then where do differences come from? – WBT Nov 7 '15 at 14:24
3

You're missing some pretty important details in describing the facts of this case.

The most important of which is: What were the agreed terms upon which Alice obtained possession of the car prior to paying?

Your description says:

Alice takes the car and doesn't pay.

If that's literally true, then this case is both criminal theft and the tort of conversion — not breach of contract. Since the remainder of your question references a breach of contract, then I have to conclude that the fact as you stated it is not literally correct and there is some important missing detail about the terms upon which Alice was in possession of the car when she crashed it.

So, I will have to invent some scenarios that would fit two other facts you describe:

  1. The jury awarded Bob $5,000.
  2. The jury found Alice to be in breach of contract.

The following are the scenarios I can think of that would match the facts (as I understand them and speculated where important details are missing from the question).

  1. Maybe this is a small claims court and the damages are capped at $5,000? I never heard of a jury trial in small claims court but I guess it could be possible. Or maybe it was actually a judge and use of the term jury was careless or otherwise inaccurate?

  2. Maybe the terms under which Alice was in possession of the car when she crashed it put the parties in position where they effectively shared liability or risk of damage to the car? Like maybe Bob (or both parties) was/were required to carry insurance on the car while Alice was "test driving" it. I only use the term "test driving" as a placeholder for whatever she was doing with the car prior to paying for it which is left unclear by the question.

  3. Maybe Bob was found to have contributed to the breach of contract by something he did or didn't do. Similar to the above speculation about insurance. All this would be much easier to analyze if we knew how and under what terms Alice came to possess the car.

  4. Maybe there was only $5k of damage done to the car? Or, alternatively, the car was only found to be worth $5k and, for whatever reason (again, which we can not fully analyze given only the partial set of facts presented) the liquidated value of the car was the basis for the damage award and not the contracted price. (Consistent with @jimsug's comment.)

  5. I can easily imagine a scenario where Bob and Alice are close friends or family so the entire transaction is handled very loosely and informally and Bob let's Alice drive the vehicle while she is gathering the money to pay him. In this case, the jury might decide Bob shares the liability with Alice since the terms of the sales contract did not transfer the risk of liability to Alice during the time she was driving prior to payment.

  • Maybe Bob has a cause of action for conversion but for some reason doesn't use it, or a judge uses the "gist of the action" doctrine to put it all under breach of contract. Possible criminal charges are out of scope for this question...perhaps assume Alice has a well-placed friend in the police department if that helps the hypothetical. Edits attempt to address 1-3. Maybe expand on #4, especially 4b? Does the jury get to reassess the deal that parties struck and change the terms to give one party a better deal than they had before? – WBT Nov 2 '15 at 5:27
  • Defendant at small claims has the right to demand jury trial. – Joshua Aug 16 '16 at 1:20
2

I see you've edited the question and added a second scenario. So I'll answer that one here.

The jury can award damages in whatever amount they decide, subject to the judge's discretion and authority. The judge can change damage awards if s/he considers the jury's award amount inequitable, unfair or inconsistent with the law.

  • @Mowzer "if s/he considers the jury's award amount inequitable, unfair or inconsistent with the law." Where does contract law come in and what does it say about these scenarios? Would the judge consider such a verdict to be inconsistent with the law? – WBT Nov 3 '15 at 3:14
  • @WBT: My personal opinion is that in both scenarios the OP presents, there are no facts mentioned that would justify an award of damages less than the contract amount. But my read of the question is that the OP is asking more of a theoretical question of can the jury... (note the first word of the title is the word "Can") and less of a legal opinion about the facts. But I could be wrong. – Mowzer Nov 3 '15 at 4:06
1

In a breach of contract case, the jury is typically asked to find both whether there was a breach, and the measure of damages. Juries are fickle. They may find a breach, but feel bad for the person (take Mowzer's example of car wreck), and as a result, they give the value of the car vs sale price. If there is a substantial difference between the two, maybe they feel she was taken advantage of.

In any breach of contract case, the issue of damages should be calculated by the jury based on a variety of factors. A jury can do with that whatever they want, and come up with something they think is fair. If it appears clear that their determination fell well outside the facts applied to the law, then opposing counsel can ask the judge to find there to be a "judgement notwithstanding verdict" or an NOV.

This is the reversal of a jury's verdict by the trial judge when the judge believes there was no factual basis for the verdict or it was contrary to law. The judge will then enter a different verdict as "a matter of law." Essentially the judge should have required a "directed verdict" (Usually requested by counsel outside of the jury's earshot and then an instruction is given to the jury to return with a particular verdict since the facts allowed no other conclusion), and when the jury "went wrong," the judge uses the power to reverse the verdict instead of approving it, to prevent injustice. This process is commonly called "judgment N.O.V." or simply "N.O.V.," for Latin non obstante verdict. This needs to be requested at the time of the verdict (some jurisdictions give you 1-3 days) or the right to ask for this relief is lost. In a case like you originally (I didn't really read the second one) described, where they gave at least the value he was out (as opposed to what he stood to make), a judge would never overturn.

I have seen this happen once. I have seen a judge increase a verdict one time in a case with a very unlikable plaintiff and a very sympathetic defendant. He did not give the Plaintiff what he asked for, but gave him his actual losses (not contractual gains), when the jury gave him only $1. A judge very rarely overturns the findings of a jury, no matter how whacky they may appear.

I haven't addressed you scenarios directly for the most part, as there are so many facts that go into a jury trial that could never be represented in this format to the extent that would be necessary to opine as to why the jury did what they did. However, this answer is relevant to all jury trials.

1

A jury verdict in a civil case can be overturned by the trial judge in a post-trial motion, or on appeal, if no reasonable jury could have reached the verdict based upon the facts before it. But, unless and until someone bring a post-trial motion and/or takes an appeal to its conclusion, the jury verdict stands.

But, there are many theories upon which a reasonable jury could reach a different result.

For example, in the first case, the jury could find that the seller failed to mitigate his damages by retaking the wreckage of the car and reselling it for scrap, and could have found that the value of the wrecked car was $5,000.

In the second case, the jury could, for example, find that the testimony regarding the formation of the contract was not credible and award only the fair market value as they determined it instead on an implied in fact contract theory instead. While the jury can't overrule a formal stipulation of facts between the parties, if the defendant simply insists that the plaintiff prove their case by a preponderance of the evidence rather than stipulating to the facts, there does not have to be a formal dispute of facts at trial for the jury to disagree with the testimony of a key witness.

Also, the examples state that "At trial, Alice does not dispute the basic facts about the contract or what happened.", but in the U.S. civil litigation context it is almost impossible for cases like that to go to trial. If there is really no dispute of fact, the case will be resolved in motion practice (there are several steps of a lawsuit where this could happen), and the case would never go to a jury in the first place. No reasonable lawyer would miss an opportunity to do so in a case that was that clear.

Cases generally only go to trial when there is a genuine dispute regarding a material fact in a case.

For what it is worth, it is also the case that only about one in 10,000 civil cases with $10,000 or less in dispute are tried by jury anyway. Almost all such cases are resolved in bench trials in which a judge must justify his verdict in either an oral opinion delivered from the bench or a written opinion usually prepared after the trial and then served on both parties.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.