1. Compensatory Damages

Compensatory damages are the most common remedy in breach of contract cases. The goal is to put the non-breaching party in the position they would have been in had the contract been fully performed.

• Expectation Damages: These cover the direct financial losses suffered due to the breach. For example, if a contractor fails to complete a project as agreed, the damages may include the cost of hiring a replacement at a higher price.
• Consequential (Special) Damages: These account for indirect losses caused by the breach, such as lost profits due to delayed performance.

For compensatory damages to be awarded, the plaintiff must provide clear evidence of their financial losses.

2. Restitution

Restitution aims to restore the non-breaching party to their pre-contract position. If one party received a benefit due to the contract but failed to fulfill their obligations, the court may require them to return what they received.

For example, if a buyer pays for goods that are never delivered, restitution may require the seller to refund the purchase price. This remedy is often used when a contract is rescinded or voided due to fraud or misrepresentation.

3. Specific Performance

In some cases, monetary damages may not be sufficient, and the court may order the breaching party to perform their contractual obligations. This remedy is most common when the subject matter of the contract is unique, such as:

• Real estate transactions
• Rare goods or works of art
• Business agreements with non-substitutable obligations

Specific performance is an equitable remedy, meaning it is only granted when financial compensation would not adequately resolve the harm.

4. Rescission

Rescission cancels the contract and restores both parties to their original positions before the agreement was made. This remedy is often pursued in cases of:

• Fraud
• Misrepresentation
• Duress
• Mutual mistake

When a contract is rescinded, both parties are released from their obligations, and any payments or property exchanged are typically returned.

5 Liquidated Damages

Some contracts include a liquidated damages clause. This specifies the amount that one party must pay in case of a breach. These clauses are enforceable if they represent a reasonable estimate of potential damages and are not considered a penalty.

For example, a construction contract may stipulate a daily penalty for delays in project completion. Courts will generally uphold these clauses as long as they are not excessively punitive.

6. Nominal Damages

Even if no substantial financial loss occurs, a court may award nominal damages. This is a small sum to recognize that a legal wrong has occurred. These cases typically arise when a breach is proven, but there is no measurable financial harm.

7. Punitive Damages (Rare in Contract Cases)

Punitive damages are meant to punish the breaching party for egregious misconduct, such as fraud or bad faith. While they are common in tort cases, courts rarely award punitive damages in contract disputes unless the breach involves particularly egregious behavior.

Choosing the Right Legal Remedy

At Tempus Fugit Law, we evaluate each breach of contract case based on its unique circumstances. Our legal strategy considers:

• The nature and severity of the breach
• The financial impact on the non-breaching party
• Whether specific performance is a viable option
• The existence of liquidated damages clauses
• The likelihood of recovering damages in court

Whether you need to recover financial losses, enforce contract terms, or seek another form of relief, we are here to guide you through the legal process.

If you believe you have a breach of contract claim call (617) 752-2371, email inquiry@tflawllc.com or contact us here on our website to start exploring your options with an experienced attorney today.