Explain the types of Damages

Question

Explain the types of Damages?

Answer 1

1. Expectation Damages

An amount awarded based on the expected profit or monetary benefit the plaintiff expected to receive pursuant to the contract.

2. Reliance Damages

The monetary value of the time, effort, and expenditures the plaintiff wasted in preparation for performance under (or “in reliance on”) a contract.

3. Account of Profits

Where the defendant ends up with a gain as a result of the breach, the plaintiff may sue for damages based on that gain (rather than on his or her own loss).

4. Nominal Damages

If the breach resulted in neither a loss for the plaintiff nor a gain for the defendant, symbolic damages may be awarded in very small amounts.

5. Liquidated Damages

This is an amount of damages agreed to in advance by the parties for breach of contract. The amount must not be a penalty (an exorbitant amount) but must be a genuine attempt to estimate the loss.

6. Punitive Damages

Unlike the other categories of damages, which all compensate for a loss, these damages are intended to punish the defendant and discourage bad behaviour.