Sullivan v. O’Connor

• Sullivan sued plastic surgeon after nose fix made it worse. Claims both malpractice and breach of contract.
• Doctor made express warranty that nose would be better after surgery; this warranty was violated.
• Under malpractice claim, need to prove negligence; but under contract claim, need only to prove breach of contract.
• In lower court jury found doctor was not negligent, but did find for plaintiff on contract claim.
• In torts, generally want to put person back in position had injury not occurred; these are reliance damages. In contracts, reliance damages would party in same position as they would have been in had the contract not been made; i.e., had surgery never taken place.
• General norm in contract law is expectation damages–would want to put Sullivan into position with fixed nose (as if contract had been performed as promised).

• If we assume Sullivan’s nose was originally worth $35K, and would have been $50K had operation been performed correctly but only $25K with improper operation.
• If Sullivan is awarded her expectation interest, she would be awarded $25K (the difference between what she expected and what she ended up with).
• If we want to protect Sullivan’s reliance interest, she would be awarded only $10K (difference between result and original state).
• In tort law, general remedy grant is reliance-based damages. Not automatic that contract law had to protect expectation interest. Why protect expectation interest? ? Defendant voluntarily entered into agreement knowing expectation interest would be protected (but could also apply to reliance interest).
? Provides incentive to enter into contracts, provides incentive for plaintiff to rely on contract.
? Generally, we want people to rely on promises made by other people.
? Example: steel company makes a future contract for purchase of iron ore that is later converted into steel (forward contract). Steel company should act with expectation of delivery of steel; purchase other components, make deal with auto manufacturer, etc.. Company needs to be able to rely on its expectations.
? Why not stick with reliance interest and make plaintiff prove everything they did in relying on the contract to come up with damages?
? Expectation damages in contract law is based upon model of commercial/business context.
? Reliance might be hard to quantify or prove.
? Might be waste of judicial resources to require proof of reliance costs when it is nearly always there, or if it’s very hard to quantify or prove but almost certainly there.
? Can we assume ‘automatic reliance’? ? In business transactions, there is an opportunity cost. If steel company had not entered into contract with iron ore company, they would have entered into contract with another iron ore company. Cost of making contract with first company includes not having made contract with other company.
? This would be per se reliance in business contracts.

? Sullivan v. O’Connor, however, is quite far from business transaction context. Might want to grant reliance interest so as to not place too much liability on doctors, public policy reason. But why grant cause of action at all? ? Judges really think case is about negligence, this reflects remedy.

? Also might be difficult to quantify.
? Court is ambivalent about breach of contract cause of action: “Cause of action is somewhat suspect”thus “moderation…of the recovery…should be permitted.”
? Possibly pain and suffering under reliance theory would actually be greater since she would have had pain and suffering anyways if the operation had been successful. Under reliance theory, however, pain and suffering can be included because that is needed to get her back to original state.

Generally don’t get restitution damages. E.g., Naval Institute case: damages were based on plaintiff’s loss, not defendant’s gain. Primary reason is that restitution damages would be punishment in many cases. Exceptions: spy case, copyright cases. These cases deal with property that is suspect in another person’s hands. Also, in trust situations, restitution is granted. In corporations, directors and officers are considered fiduciaries as in trust situations. When trust situation is breached, no ambivalence–this is wrong. Thus restitution can be granted.

Remedy in these cases is damages not specific relief. Later in course we’ll see frequent exceptions to this dogma.

Author: international