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Tacket v. GMC, Delco Remy Div. - 830 F. Supp. 468 (S.D. Ind. 1993)

Rule:

Ordinarily, in a breach of contract case, the injured party's damages are measured by the loss in value to him of the other's party's failure to perform. When an employer breaches an ordinary employment contract, even if the employer intended to cause the employee emotional harm in breaching that agreement, emotional distress damages are not recoverable under a breach of contract claim. The tort of intentional infliction of emotional distress is unavailable in a breach of an employment-at-will contract. In contract actions, the defendant's motive or state of mind is of no moment except where punitive damages are sought. Persons who have entered into consensual arrangements and specified their own duties and remedies need not fear that courts will use tort doctrine to pull the rug out from under them. Emotional and mental distress is generally not compensable in a breach of contract action, particularly in the absence of a physical injury. 

Facts:

After an employee had filed a defamation suit against his employer, his employment was terminated. Subsequently, the employee filed a suit against the employer seeking compensatory emotional distress damages for the breach of the employment contract as well as asserting a separate tort claim of intentional infliction of emotional distress. The employer filed a motion to dismiss the claims. 

Issue:

Was the employee entitled to damages based on emotional distress for the employer’s alleged breach of contract?

Answer:

No

Conclusion:

The court granted the motion in part and dismissed the contract claim holding that the employee was not entitled to emotional distress damages for the employer's breach of contract. The court further held that the employee had not claimed any physical injury from the breach and that the employment contract was not the type of contract under which a breach was likely to result in emotional distress. Therefore, the court held that the employee had not established the exceptions to the general rule prohibiting the recovery of emotional distress damages in contract claims. Finally, the court held that because the parties had failed to adequately brief the issue, it was unable to determine whether or not the employee's tort claim was barred under the statute of limitations period.

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