Question

A lawyer is suing a structural engineer on behalf of a client for $250,000 who’s garage slid off a hillside because of the structural flaws missed by the engineer which caused it to slide away during a rainstorm. Assuming the court rules in favor of the client, what types of damages would be needed in order for them to be equally happy as they were before the garage fiasco?

A. some amount less than $250,000

B. exactly $250,000

C. some amount greater than $250,000

Answer 1

Answer: A

This would be the amount smaller than $250,000.

The suing amount is $250,000, which is charged by the lawyer. The client is expecting to get it but probably not sure of getting it; therefore, if he gets something around $250,000 (may be smaller) he would be relieved and happy.

On the other hand, the engineer would also be happy since he doesn’t have to pay $250,000 but paying smaller than this.

Other options are not correct:   

Option B: this makes the client happy but not the engineer, since he has to pay whatever demanded – there is no “consumer surplus” on behalf of the engineer.

Option C: this makes the client happy only, since he is getting higher amount.