WASSENAAR V. TOWNE HOTEL
331 N.W.2d 357 (1983)
NATURE OF THE CASE: This was an appeal from an award of damages for a breach of an
employment contract.
FACTS: Wassenaar (P) was hired by Towne (D) as the general manger of its hotel. The
contract provided for a three-year period of employment renewable at the employee's option,
and a stipulated damages clause in case D terminated P before the expiration of the
contract. D terminated P's employment 21 months prior to the expiration date. P was then
unemployed for about 10 weeks when he obtained another job at another hotel. P sued D for
damages. D argued that P had failed to mitigate his damages. P argued that mitigation was
irrelevant because of the stipulated damages clause in the contract. The trial judge ruled
that P had not duty to mitigate; which was an affirmation of the validity of the stipulated
damages clause. The jury gave P 21 months worth of pay from the unexpired term of the
contract. The court of appeals reversed holding that the stipulated damages clause was a
penalty; in that the amount of damages from a breach of employment contract can easily be
computed by the trial court. P appealed.
ISSUE:
RULE OF LAW:
HOLDING AND DECISION:
LEGAL ANALYSIS:
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