Question

Ex ante means "before the fact" and ex post means "after the fact."

Assume you are a damages expert hired as I was to calculate damages from a breach of contract case. The facts were that the defendant had breached a contract by not selling the plaintiff's product but had, instead, sold an inferior but cheaper product. The defendant had developed forecasts of the sales of plaintiff's products before the breach. These sales were not made, but were forecasted for 2010 - 2012. The defendant's actual sales of the cheaper, inferior product in 2010 - 2012 were lower than the forecasted sales of the plaintiff's product. If you were calculating benefit of the bargain damages, which sales would you use in your estimate of the total damages -- actual or forecasted?

Answer 1

As per the demand of the question.....

Answer:-

Defendant :- A person whether natural or artificial sued or accused in a court of law. Or a person in whom a suit has been filed in a court of law.

Plaintiff :- A person whether naturak or artificial brings a case against another in a court of law. Or a person who files a suit in a court of law.

Plaintiff most probably a victim.

What is benefit of bargain damages ?

A) All the damages that a breaching party(here defendant) to the contract must pay to the injured party (here plaintiff). Generally it is equal to what plaintiff would have receive d including profits if the contract had been fully performed.

Forecasting of sales :- It is the prediction of a company how their future sales will be.

Calculation of benefit of bargain damages :-

(1) Determining fair market value of Forecasted sales -- $ ××××

Less

(2) Determining actual size of sales -- $××××

(1) - (2) = net damages to be payable by defendant to plaintiff .

It is based on the fact that what would be the sales if every thing goes right and actual sales.

Ex:- A and B entered into contract that B would make sale of 100000 units of products of B.

But B breahced

breached the above contract by selling only 40000 units. Assume market or fair price per unit be 10$.

Now benefit of bargain damages would be calculated as follows.

(1) Sales if B would have performed the contract = 10,00,000 $

Less

(2) Actual sales by B = 400,000 $

Net (1) - (2) = 6,00,000 $

Conclusion:- From the above explanation and illustration, it is obviouse that while calculating benefit of bargain damages both actual and forecasted sales are considered.