Damages

About: Damages is a research topic. Over the lifetime, 9365 publications have been published within this topic receiving 89750 citations. The topic is also known as: compensation award.

Unenforceable Contracts: Penalty Clauses and Specific Performance

Abstract: THAT many aspects of the common law may be explained in terms of economic efficiency, defined as wealth maximization, is a proposition that has been well-established by the work of Posner' and others. I have, along with others, provided arguments which partially explain why this is true.2 Thus, it is puzzling when there is some legal rule which cannot be so explained. To date, one of the main anomalies in the economic explanation of common law is the rule against penalty clauses in contracts. If two parties sign a contract specifying a payment in the case of breach and if the courts determine that damages are greater than the actual costs of the breach, the damages will not be allowed. Though there are some economic explanations for this behavior in the literature,3 these explanations have not been fully convincing.4 Another area in which economic analysis has not been fully satisfying is the area of specific performance. Kronman is able to explain some of the reluctance of the courts to order specific performance in the case of contracts, but he is still left with some puzzles.5 In this paper, I provide an explanation for both of these aspects of the courts' refusal to enforce contracts. The argument is based on Telser's

Leveling the Playing Field: Is it Time for a Legal Assistance Center for Developing Nations in Investment Treaty Arbitration?

Abstract: Introduction In the last 15 years, developing nations have signed over 1500 bilateral investment treaties (BITs) in an effort to attract foreign direct investment (FDI) by creating a more stable and transparent investment environment for foreign investors. BITs provide foreign investors with powerful new rights to protect their investments against expropriation and other forms of discrimination and the ability to sue governments directly through a form of dispute settlement known as investment treaty arbitration. The last 5 years have seen an explosion in the number of investment treaty arbitration claims filed against developing nations, challenging a wide array of sensitive government regulations and routinely seeking millions and even billions of dollars in damages. Mounting an effective defense to these claims is essential for a developing nation, as even a single adverse award could wreak havoc on its economy, weaken its capacity to regulate in the public interest, and damage its reputation as a desirable investment location. While the number of investor claims is growing, there are new concerns over how well-prepared developing nations are to cope with the challenge of litigating these claims.

The Joint Use of Regulation and Strict Liability with Multidimensional Care and Uncertain Conviction

Abstract: The purpose of this paper is to explore the joint use of regulation and strict liability when firms can take care in both observable and unobservable dimensions and when the firm's conviction for damages is uncertain. Much of the literature concerning joint use regards management of the judgment-proof problem; the take-home result of our paper is that if the harming party can take both observable and unobservable care, then joint use can improve welfare even in the absence of judgment-proofness. This is true even when penalty multipliers are allowed, provided social welfare is negatively related to the firm's expected liability costs. In fact, use of penalty multipliers further strengthens the case for joint use.