What damages can you recover from a breach of contract? Part 1

Contracts are the bread and butter of business development. Unfortunately, economic circumstances change, businesses evolve and sometimes those contracts are breached. A breach of contract occurs when someone fails to perform a part of the contract. Generally, it is one of those "you will know it when you see it" moments.

There are three types of recovery in a contract dispute: damages, cancellation or restitution of the contract and specific performance of the act. This article will address the damages aspect of recovery. There are four types of damages: compensatory damages, nominal damages, liquidated damages and punitive damages.

Damages that compensate you for the specific, measurable loss you incurred. This could be things like being forced to find an alternate, more expensive supplier or if you had to refund tickets because the performer you hired refused to play. The situations are endless. However, the point is that your harm adds up to a specific dollar amount.

Second, you recover nominal damages if the contract was breached but you did not incur any losses. For example, you hired a performer that refused to show up but this occurred before you sold tickets and you were able to find an alternate act. Your actual damages would be very low but you can still sue for a nominal amount due to the breach. It is like a moral victory of showing that you were right and the other party was wrong.

Unfortunately, contracts are violated. Usually, it is because of economic necessity or changed business circumstances. Regardless of the reason, a breached contract can still result in thousands of lost dollars. Hopefully, you are able to resolve this issue amicably. However, if you cannot, then you may want to speak to an attorney. An attorney can go over the gravity of the breach and lay out the compensation to which you may be entitled.