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

Exercise 8

Breach and Damages. Before Chad DeRosier could build a house on his undeveloped property, he needed to have some fill dirt dumped onto the land. Utility Systems of America, Inc., was doing roadwork nearby, and DeRosier asked Utility if it would like to dump extra fill dirt onto his property. Utility said it would, and DeRosier got the necessary permits. The permit was for 1,500 cubic yards of fill dirt, which was how much DeRosier needed. DeRosier gave Utility a copy of the permit. Later, DeRosier found a mountain of fill dirt on his land-6,500 cubic yards. So 5,000 cubic yards of fill dirt had to be removed. Utility denied responsibility but said that it would remove the fill dirt for $9,500. DeRosier sued and hired another company to remove the fill dirt and to do certain foundation work. He paid $46,629 to that contractor. The district court held that Utility had breached its contract and ordered it to pay DeRosier $22,829 in general damages, and $8,000 in consequential damages. Utility appealed. Because Utility charged nothing for the fill dirt, was there a breach of contract? If a breach occurred, would the damages be greater than $9,500? Could consequential damages be justified? Discuss. [ DeRosier v. Utility Systems of America , Inc., 780 N.W2d 1 (Minn.App. 2010)]