Brevard County companies often put a great deal on the line when they agree to a business contract. In fact, it is not uncommon for a broken contract to hurt one party so badly that it needs to shut down its business operations entirely.
In these types of situations, however, the injured contract holder will have the right to seek damages in court. These damages generally fall under four important categories: 1) compensatory damages, 2) punitive damages, 3) nominal damages, and 4) liquidated damages.
Let’s review what these damages mean in the context of a breach of contract case:
1. Compensatory damages
This category of damages attempts to financially compensate the injured party for the breach of contract and financial harm it caused. For example, if the injured party lost $2.5 million because a construction company failed to complete the project on schedule according to the contract, then those damages may fall under compensatory damages.
2. Punitive damages
This category of damages refers to payments that a breaching party has to make beyond compensatory damages as a means of punishing them for their wrongful acts. Punitive damages are not commonly awarded, but in situations that are particularly egregious, the court may deem them warranted.
3. Nominal damages
These damages may be awarded in situations where the contract breach did not cause actual monetary harm. They are considered “token” damages.
4. Liquidated damages
These are damages that were previously agreed upon within the contract in the event that a certain kind of contract breach occurs. For example, if the construction company failed to complete the project on time according to the contract, the exact amount of damages may have already been specified within the contract.
Getting legal help in a breach of contract case
A breach of contract case can range from relatively simple and straightforward, to complicated and subject to differing legal interpretations. Brevard County companies that have been injured as a result of a breach of contract matter may wish to contact a local commercial litigation attorney to help them pursue damages in court.