Ptarmigan Investment

The case that was present in 16.5 is that a breach of contract by Ptarmigan Investment Company who had contracted Gunderson’s, Inc. to construct a golf course for them. After just a third of the work had been completed, Ptarmigan Investment Company ran out of funds to cater for the rest of the project. Therefore, they would not be in a position to pay for the remaining two thirds of the work. Gunderson’s, Inc. has sued the company in a bid to recover the lost profits which if granted would be given to them as damages. The question presented is whether Gunderson’s, Inc. can recover the lost profits as damages. It is evident that the investment company has gone against its agreement with the contractor. Ptarmigan Investment Company has rendered inferior performance of its obligations under the contract. In an unprecedented turn of events, they are unable to pay the contractor for their services. Although the work was yet to be completed, the contractor had anticipated a certain amount of profit. Therefore, they are justified under the law to claim compensation from the breaching party. Gunderson, Inc. can receive damages in form of monetary compensation. This is one of the methods used to remedy contract breaches. Compensatory damages are awarded in the event that a breach of contract has led to a loss of a bargain. In so doing it places the non-breaching party in the same position it would have been had the contract been fully performed with regard to the benefits accrued. In this case, payment to the contractor was estimated at $1,294,129 and payment had already been made for a third of the work. The sum of money owed to restore the bargain made is $ 867,066, which would ensure that the contractor has earned their full profits. Gunderson’s, Inc. can recover lost profits as damages because the contract was breached before completion of the construction