Cengage Advantage Books: Fundamentals of Business Law 9th Edition by Roger LeRoy Miller

Exercise 18

Spotlight on Types of Damages-Compensatory Damages. Tyna Ek met Russell Peterson in Seattle, Washington. Peterson persuaded Ek to buy a boat that he had once owned, the O'Hana Kai, which was in Juneau, Alaska, for $43,000. Ek and Peterson then entered into a contract under which Peterson was to make the boat seaworthy so that it could be transported to Seattle within a month, where he would pay its moorage costs and renovate the boat at his own expense. In return, Peterson would receive a portion of the profit on its resale the following year. On the sale, Ek would recover her costs, and then Peterson would be reimbursed for his. Ek loaned Peterson her cell phone so that they could communicate while he prepared the vessel for the trip to Seattle.
In March, Peterson, who was still in Alaska, borrowed $4,000 from Ek. Two months later, Ek began to receive unanticipated, unauthorized bills for vessel parts and moorage, the use of her phone, and charges on her credit card. She went to Juneau to take possession of the boat. Peterson moved it to Petersburg, Alaska, where he registered it under a false name, and then to Taku Harbor, where the police seized it. Ek filed a suit in an Alaska state court against Peterson, alleging breach of contract and seeking damages. If the court finds in Ek's favor, what should her damages include? Discuss. [ Peterson v. Ek, 93 P.3d 458 (Alaska 2004)] (See Damages.)