Valentine v. General American Credit, Inc.

Supreme Court of Michigan, 1984.

420 Mich. 256, 362 N.W.2d 628.

Dawson, pp. 77-80


Facts: Valentine alleged that her employment contract was broken.  She sued for mental distress due to loss of job security.  Her mental distress claims were dismissed at trial, and the decision was upheld on appeal.  She appealed to the Supreme Court of Michigan.


Issue: Can an employee who loses their job sue for mental distress?


Rule: Mental distress damages for breach of contract are not recoverable except when the contract has a personal element or when the damage suffered due to breach cannot be compensated within the terms of the contract.


Analysis: The court argues that breaches of contract always cause annoyance, but the law does not allow a plaintiff to recover for such annoyance.  The court says there are many cases where the law does not allow a full recovery.  The rule of foreseeability from Hadley is not properly applied to this case.


Conclusion: The judgment of the lower courts was affirmed, and the plaintiff received no mental distress damages or exemplary damages.


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