Contractual damages—general principles


Produced in partnership with Zainab Hodgson and Kavidha Clare of CMS
Practice notes
In-house

Contractual damages—general principles


Produced in partnership with Zainab Hodgson and Kavidha Clare of CMS

Practice notes
In-house
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This Practice Note considers the general principles of recovering damages for contractual breach, starting with the compensatory function of damages and the different kinds of damages for pecuniary and non-pecuniary losses, as well as nominal damages, damages under the Sale of Goods Act 1979 (SGA 1979), default damages clauses, contractual mechanisms for dealing with breach and interest on damages.

Per Baron Parke in Robinson v Harman, a party who suffers loss as a result of breach of contract is entitled:

‘To be placed in the same situation, with respect to damages, as if the contract had been performed.’

Compensatory function of damages for breach of contract

The normal function of damages for breach of contract is the same as that in tort, namely, compensatory (see, eg British Westinghouse v Underground Electric Rlys). The aim being to compensate the true loss suffered by the innocent party and place them in the same position, so far as money can do it, as if the contract had been performed. To this extent (and while

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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Damages definition
What does Damages mean?

The monetary compensation awarded by law to a person for the legal wrong done to him.

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