Reference no: EM131738733
Albert is a short-order chef and has always dreamed of owning his own burger joint. After years of waiting, the opportunity arrived when he heard that Burgers-R-Us, a national fast food chain, was planning to open a franchise in his town of Freedonia Heights, in the state of New Freedonia.
After several months of negotiations, Albert has signed a contract with Burgers-R-Us, and is now the proud franchisee of a store that is scheduled to open on the second Friday in January.
In preparation for the opening, Burgers-R-Us has furnished Albert's store with kitchen equipment, tables and seating, lighting and signage for inside and outside the store. Albert has purchased aprons, hats and latex gloves ($3,347.68) for his staff and "Grand Opening" banners for outside ($1,026.59). He placed advertisements in the localPennysaver magazine and in the Heights Gazette to hire cooks, cashiers, waiters and cleaning staff ($1,375); the ads are running for four consecutive weeks. He hasn't hired anyone yet, but has interviewed several potential candidates. Albert also gave BRU a deposit of $17,000 to secure his rights.
In consultation with his accountant, Albert has projected that in his first six months, he will have an operating loss of $23,000, but that by the end of his first year he will show operating profits of $78,000 for the year and that he will be profitable each year thereafter. These estimates are based on what Albert has been able to find in newspaper articles for other types of franchises in other cities. He has no specific numbers relating to his own franchise.
Six weeks prior to the scheduled grand opening, Burgers-R-Us notifies Albert that new market research has shown that the franchise is not likely to be successful in Freedonia Heights and the franchise contract is hereby cancelled. Outraged, Albert sues Burgers-R-Us in New Freedonia state court for breach of contract.
Discuss what types of damages Albert may claim, which types is he likely to be awarded and what amounts he is likely to be awarded. Be sure to thoroughly explain your answers.
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