Judicially enforced expectation damages fail to make promisees whole or deter breach.
Evidence
In most settings, expectation damages, as enforced through the courts, do not achieve their stated theoretical objective of placing the promisee in the same position that he would have been in if the breach had never occurred; they neither make the promisee whole ex post, nor give the promisor sufficient incentive to perform the promise ex ante. — Lisa Bernestein, Opting out of the Legal System, 149
Categorization
- DEEPTHINKING: A foundational strike against the textbook law-and-economics claim that expectation damages optimize performance — and the precise inefficiency that licenses the diamond industry’s extralegal system.
- XREF: connects to: Expectation damages as enforced in practice fail to deter breach. — Lisa Bernestein, Opting out of the Legal System, 148; Legal damages fail to compensate lost profit because intervening business value is inherently speculative. — Lisa Bernestein, Opting out of the Legal System, 151; Interest damages only fully compensate promisees who can access credit during the dispute. — Lisa Bernestein, Opting out of the Legal System, 152
Related
- Expectation damages as enforced in practice fail to deter breach. (similarity 0.90)
- Liquidated damages clauses fail when post-contract reliance makes harm unpredictable. (similarity 0.82)
- Legal damages fail to compensate lost profit because intervening business value is inherently speculative. (similarity 0.80)
- Interest damages only fully compensate promisees who can access credit during the dispute. (similarity 0.79)
- Ex post consequential harm makes liquidated damages clauses hard to enforce in diamond deals. (similarity 0.78)
Broader Connections
- Expectation damages as enforced in practice fail to deter breach.
#corroborates(0.95) — Lisa Bernestein, Opting out of the Legal System, 148 - Legal damages fail to compensate lost profit because intervening business value is inherently speculative.
#expands(0.75) — Lisa Bernestein, Opting out of the Legal System, 151 - Interest damages only fully compensate promisees who can access credit during the dispute.
#qualifies(0.72) — Lisa Bernestein, Opting out of the Legal System, 152