When you enter into a contract with another party, it is expected that the agreement’s terms will be met. Contracts should be written in such a manner that both parties will derive value from adherence to its terms. Unfortunately, sometimes disputes arise and obligations are not met.
When a party fails to carry out the stipulations to which they committed in a written agreement, they are said to have breached their contract. Sometimes a breach of contract is of such severity that the non-breaching party must seek legal remedy in the form of damages to recoup a financial loss. The following are the types of damages that a non-breaching party may be legally entitled to:
- Nominal damages are symbolic damages that are issued if a breach occurs, but no financial loss on behalf of the non-breaching party is proven.
- Punitive damages are used as a form of punishment against a breaching party. Such damages are an amount in excess of full compensation and are not typically awarded in cases regarding business contracts.
- Compensatory damages are intended to act as a means of placing the non-breaching party into the situation they would be had no breach occurred.
- Liquidated damages are damages that are written into a contract that are to be paid in the event of a breach of that contract. Liquidated damages are meant as a fair and logical estimate of potential damages.
Seeking damages is just one avenue you may want to consider in the event of a breach of contract. Your best options will likely be determined by the circumstances of the breach and the terms contained in the contract. A Florida attorney may be able to offer advice regarding how to respond to a contract dispute.
