What is the difference between expectation damages and consequential damages

These are damages that stem from the ordinary, natural, and probable course of events in the breach of contract. In some cases, monetary damages may be judged insufficient to compensate the aggrieved party. In this case, equitable remedies may be awarded. Equitable remedies involve a court ordering a party or parties to act or not act in a certain way. Examples could include:. However, having a very basic understanding of these types of damages concepts is also helpful.

Following is a very general, limited overview of damages concepts. Keep in mind that the meaning of these terms and the applicable categories can vary from jurisdiction to jurisdiction and based on the type of contract in question e. There are a variety of theories and approaches to measuring damages used by courts in different contexts. However, the software does not function. Here, any company that requires this type of software for its business would need to recoup its licensing fee from Slipshod Software and would need to obtain comparable alternative software at the best available price.

These particular indirect damages fall into two categories: incidental damages and consequential damages. These are the damages such as costs that a company incurs to avoid other losses that would otherwise result from the breach of contract.

Here, for example, Startup Company might have lost more than the two clients, and therefore incurred much greater lost profits if it had not invested personnel time in finding other software. Distinguishing between consequential damages and other types of damages can be challenging, and lost profits do not fall within the consequential damages category in every situation.

They may also be found in cases that overlap with fraud or tort law. Damages are sometimes included in the contract itself, determined during contract negotiations, and later used as a guideline in the event of a breach. These damages are also rare in contract cases, which usually involve some form of loss, but they may also appear in cases that cross over with tort law. That being said, every case is different. A knowledgeable lawyer will be able to tell based on the particulars of your case.

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