Opinion ID: 4528906
Heading Depth: 3
Heading Rank: 2

Heading: Rescissory Damages for Breach of Contract

Text: The trial court awarded equitable rescissory damages of $211,863,998.56 on Claymore’s breach of contract claim. 9 This relief amounted to a refund of Claymore’s investment losses. It 9 The trial court also awarded an identical amount as to the claims for fraudulent inducement, breach of the implied duty of good faith and fair dealing, aiding and abetting fraud, and civil conspiracy. Those claims are addressed in Parts II.B and II.C. 13 represents the amount of Claymore’s investment minus settlement amounts previously received from non-parties and small amounts Claymore received in payments from the borrower before default. 10 The amount awarded by the court is more than five times the $40 million awarded by the jury, which was asked on the fraudulent inducement claim to measure damages by determining “[t]he difference, if any, between what Plaintiff paid and value of what Plaintiff received from the 2007 Lake Las Vegas Refinancing.” Under New York law, “rescissory damages” are “the economic equivalent of rescission in a circumstance in which rescission is warranted, but not practicable.” Syncora Guarantee Inc. v. Countrywide Home Loans, Inc., 935 N.Y.S.2d 858, 869–70 (N.Y. Sup. Ct. 2012). Claymore cites no New York appellate decision affirming an award of rescissory damages. It agrees, however, that rescissory damages are governed by the same principles governing the better-known equitable remedy of rescission. Rescission is a remedy whereby the court vitiates the contract between the parties and places them where they were before the contract was made. Vitale v. Coyne Realty,