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the entrepreneur had initially planned to do so. Here, the consultant cannot recover for profits it would have made had the entrepreneur hired it to help with locations after the first. The lost profits on these later locations were too speculative. The entrepreneur had multiple problems with the consultant. So, there was little indication that, but for the defective equipment, the entrepreneur would have hired the consultant to help with later locations. [ Adapted from Car Wash Consultants, Inc. v. Belanger, Inc. , No. 08–1195, 2009 WL 3775101 (Iowa Ct. App. Nov. 12, 2009).] Deducting Damages from the Price As discussed above, as to any goods accepted, the buyer owes the seller the purchase price, even if the seller has breached the contract. (This rule assumes, of course, that the buyer does not justifiably revoke acceptance.) The seller also will owe the buyer damages. It makes sense here to permit the buyer and seller to offset amounts they owe to each other, to avoid the absurdity of making A pay B when B owes A. Section 2-717 provides such an offset. If any part of the contractual price is still due, the buyer may deduct from that sum any damages arising from the seller’s breach of that same contract. However, the buyer must give the seller notice of intent to withhold all or part of the price. [U.C.C. § 2-717, cmt. 1 (1951).] 1. Deducting Damages from the Price under § 2-717 v. a Counterclaim for Damages The self-help remedy of deducting damages from the price under § 2-717 is distinct from a defendant’s general right to assert a counterclaim in litigation. The buyer may invoke § 2-717 even if no litigation has commenced. The deduction is limited to any price still owing under the very same contract that the seller supposedly breached. In litigation, though, the buyer, as defendant in a seller’s action for the price, could assert counterclaims against the seller for damages under that same contract and any number of other transactions involving the seller, regardless of amount. [2 Hawkland UCC Series § 2-717:1, Westlaw (database updated June 2021).] 2. Notice Requirement to Deduct Damages from the Price To exercise the self-help remedy of deducting the buyer’s damages from the price, the buyer must afford the seller notice of intent to do so. This requirement’s purpose is to keep the buyer from being held in breach for failing to pay when due ( e.g. , by giving the seller reasonable grounds for insecurity). The notice need not take any particular form, provided it reasonably indicates the reason why the buyer aims to withhold the price. [U.C.C. § 2-717, cmt. 2 (1951); 2 Hawkland UCC Series § 2-717:2, Westlaw (database updated June 2021).]
Limitation or Modification of Remedies in the Agreement
As a general rule, and subject to the rules on liquidating and limiting damages, an agreement may
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