Business Law and the Legal Environment 7th Edition by Jeffrey Beatty,Susan Samuelson

Exercise 6

Consequential damages can be many times higher than direct damages. Consider the "Farmer Ted" scenario raised in the multiple-choice section of this review, which is based on a real case.7 Is it fair for consequential damages to be 60 times higher than direct damages? The Supreme Court is skeptical that punitive damages should be more than 9 times compensatory damages in a tort case. Should a similar "soft limit" apply to consequential damages in contract cases?