What Is A Breach Of Contract And What Damages Can I Recover In The Event Of A Breach Of Contract?
A contract is an exchange of mutual promises between two or more individuals. It can be written or oral, but the key component is that each side is going to do something for the other.
A breach of contract is when one party to the contract fails to perform its side of the bargain, and that’s when you have a breach. Now, the damages that can recover is actually a complex question. There are various types of damages that one can recover. For example, if I was going to buy widgets at a dollar a widget from you, and you stop supplying widgets to me and I had to go on the spot market and buy widgets at $2 a widget, I could recover the extra dollar per widget that I had to pay.
On the other hand, I had a client just recently who bought a home from someone and was deceived about the condition of that home. In that case, we’ve got rescissory damages, meaning that the person who sold them the home had to give them back their money and take the home back, as well as pay their transaction costs and legal fees.
Generally speaking, what you’re looking for in a breach of contract is going to be either reliance damages; you said you were gonna do something for me and I spent all this money to get ready, and I get that money back, or expectancy damages, which tend to be my lost profits. Had you performed, I would have made this much money. The latter category is a much more complex area and very difficult to prove in court, but with the right lawyer and the right evidence, it can and will be proven.