Are compensatory damages direct damages?

Asked by: Prof. Katrina Pouros PhD  |  Last update: September 20, 2022
Score: 5/5 (3 votes)

Compensatory Damages
General damages are a direct result of the defendant's wrongful conduct, and special damages are unique to the party affected by the defendant's breach of contract.

What are considered direct damages?

Direct damages are “the necessary and usual result of the defendant's wrongful act; they flow naturally and necessarily from the wrong.”[1] Direct damages are intended to compensate the plaintiff for the loss incurred that was foreseeable by the defendant from his wrongful act.

Are consequential damages direct or indirect?

Direct damages are damages resulting directly from a breach of the contract whereas consequential damages are damages that are not directly caused by the breach but normally and naturally arise from the circumstances of the non-breaching party.

What kind of damages are compensatory?

Compensatory damages are designed to compensate plaintiffs for the actual losses they've experienced. This type of award can be to reimburse them for medical treatments, medical bills, or any future expenses they may have due to an injury they sustained due to the negligence of another person or entity.

Are compensatory damages consequential damages?

Consequential damages (also known as special damages) are another form of compensatory damages. Special damages do not flow directly and immediately from the defendant's act, but from some of the consequences of the act.

Contract Law Remedies for Breach: Damages (Compensatory, Incidental, Consequential)

40 related questions found

What are the four types of damages?

One of the most common remedies comes in the form of damages, or monetary awards, which are further broken down into four general categories.
  • Compensatory Damages. Compensatory damages (or “actual damages”) are specifically meant to make up for the plaintiff's losses. ...
  • Punitive Damages. ...
  • Liquidation Damages. ...
  • Nominal Damages.

Are general and compensatory damages the same?

Compensatory damages are further categorized into special damages, which are economic losses such as loss of earnings, property damage and medical expenses, and general damages, which are non-economic damages such as pain and suffering and emotional distress.

What are the 3 types of compensatory damages?

The three types of damages are economic damages, non-economic damages, and punitive damages.

What is the meaning of compensatory damages?

Damages: An Overview

Compensatory damages, like the name suggests, are intended to compensate the injured party for loss or injury. Punitive damages are awarded to punish a wrongdoer.

What are the 3 types of damages?

Types of Damages
  • COMPENSATORY. Compensatory damages are generally the most identifiable and concrete type of damages. ...
  • GENERAL. General damages are sought in conjunction with compensatory damages. ...
  • PUNITIVE. Punitive damages are meant to punish a Defendant for particularly egregious conduct.

What is the difference between direct and consequential losses?

By definition, therefore, consequential losses are exceptional and often not recoverable. Direct loss is the natural result of the breach in the usual course of things. Most foreseeable kinds of loss are direct, including financial losses such as loss of profits and loss of business or goodwill.

What the difference between direct and indirect loss?

Direct loss is loss falling within the first limb of the Hadley v Baxendale test. Indirect loss is loss that falls within the second limb. Typically, a limitation clause in a contract will exclude responsibility for indirect loss.

Are consequential damages the same as indirect damages?

Consequential damages are damages that proximately result from a breach of a contract. Consequential damages are also commonly referred to as “indirect damages” because they arise indirectly from a breach due to various events that flow from a breach.

Is a third party claim a direct damage?

Suppliers should be clearly indemnified for any third-party losses, except for situations where their acts or negligence contributed to the extent of the loss. The full extent of any potential liability should clearly be outlined and any claims by third parties should be considered direct damages.

Are incidental damages direct damages?

Incidental damages are direct damages suffered by the buyer in an attempt to remedy the seller's breach. In addition, because “lost profits” and “multiple of earnings” damages may qualify for recovery under Hadley under certain circumstances, they should not be categorically waived.

Are punitive damages considered indirect damages?

Indirect damages have all sorts of labels: consequential, incidental, indirect, exemplary, special, enhanced, punitive, etc.

What are the 5 types of damages?

There are six different types of damages: compensatory, incidental, consequential, nominal, liquidated, and (sometimes) punitive.

Which the following is a measure of compensatory damages?

In most states, when a seller of real estate breaches a contract and sells the land to someone else, the measure of compensatory damages is: the difference between the market price and the contract price.

What is an example of compensatory?

For example, if the plaintiff was badly frightened and suffered nightmares, increased blood pressure, or other anxiety related symptoms which prevented him from working or fully enjoying his life, he could seek damages for "emotional distress." If any of his property was damaged, compensatory damages could also include ...

Which of the following best describes the term compensatory damages?

Which of the following best describes Compensatory Damages? Compensatory Damages are intended to compensate or reimburse a plaintiff for actual losses.

What three 3 Things Must a court consider in reviewing punitive damages?

To ensure that unconstitutional punishment is not imposed in the form of punitive damages, the Court has set forth three "guideposts" for courts to consider in reviewing punitive damages awards: "(1) the degree of reprehensibility of the defendant's misconduct; (2) the disparity between the actual or potential harm ...

What are the 6 types of damages?

There are six different types of damages: compensatory, incidental, consequential, nominal, liquidated, and (sometimes) punitive.

Are special damages compensatory?

Special and general damages are both types of compensatory damages in a personal injury lawsuit. Compensatory damages are designed to compensate an injured victim for the expenses and losses he or she incurred due to a defendant's mistake.

What are compensatory nominal and punitive damages?

The law recognizes three major categories of damages: COMPENSATORY DAMAGES, which are intended to restore what a plaintiff has lost as a result of a defendant's wrongful conduct; nominal damages, which consist of a small sum awarded to a plaintiff who has suffered no substantial loss or injury but has nevertheless ...

Are liquidated damages compensatory or punitive?

Liquidated damages are meant as a fair representation of losses in situations where actual damages are difficult to ascertain. In general, liquidated damages are designed to be fair, rather than punitive.