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Damages in a Breach Of Contract Lawsuit Explained

A person may be able to recover compensation for losses sustained, if a party or party's business has been harmed because another party breached a contract. This article is a brief overview of recoverable damages in a breach of contract lawsuit.

What is a breach of contract?

A breach of contract occurs when one party to a contract fails to fulfill its obligations to the other party. Types of breaches include:

  • Minor breach — One party fails to perform a part of the contract but does not breach the agreement in its entirety and the breach may not entitle the injured party to sue for damages or the damages are so minor that a lawsuit is impractical. Parties may still be obligated to perform under the terms of the contract in the event of a minor breach.

  • Material breach — A serious violation that undermines the contract as a whole. A material breach excuses performance by the non-breaching party.

  • Anticipatory breach (also referred to as Repudiation) — One party indicates through words or actions that it will not fulfill its obligations to the other party. The words must be definite and unequivocal.

Recoverable Damages in a Chicago Breach of Contract Lawsuit

No two breach of contract claims are the same, and the damages you can recover depend on a number of factors. The main goal of damages is to place the non-breaching party in the same position the party was in before the breach or entering the contract (i.e., to make the non-breaching whole), depending on the type of damages sought or available. Below are the types of recoverable damages:

  • Compensatory Damages are intended to compensate a non-breaching party for any monetary losses.

  • Restitution (also referred to as unjust enrichment) is when the breaching party pays the non-breaching party back to restore the non-breaching to the position they were in before the breach.

  • Liquidated damages are recoverable if the contract includes a provision with a predetermined amount of damages should either party breach the contract.

  • Nominal damages may be issued by the court when a breach has occurred but there has been no financial loss.

  • Equitable remedies ordered by the court may require specific performance (requires a party to act) or injunctive relief (requires a party not to act or to stop a certain act) when money damages are not available.

Finally, it is worth noting that punitive damages are generally not available in a breach of contract lawsuit. However, such damages may be awarded if there are additional claims (e.g. fraud). Punitive damages are intended to punish the defendant’s misconduct and deter future wrongdoing.

Why This Matters

Parties that enter into contracts have a right to expect other participants to live up to their end of the bargain. When one party fails to fulfill its obligations to the other, it takes a skilled business litigation attorney to successfully prosecute a breach of contract lawsuit.

To set up a consultation to discuss breach of contracts or to help you recover damages, please call Curington Law, LLC at 312 803-1755 or contact us online.




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