Contractual damages—pecuniary losses
Produced in partnership with Zainab Hodgson and Kavidha Clare of CMS
Contractual damages—pecuniary losses

The following Dispute Resolution practice note Produced in partnership with Zainab Hodgson and Kavidha Clare of CMS provides comprehensive and up to date legal information covering:

  • Contractual damages—pecuniary losses
  • Contractual damages—categories of pecuniary loss
  • Pecuniary loss—expectation-based damages
  • Pecuniary loss—reliance-based damages
  • Expectation and reliance-based damages distinguished
  • Pecuniary loss—damages for wasted expenditure and management time
  • Pecuniary loss—damages for consequential loss
  • Pecuniary loss—gains-based damages

This Practice Note considers the different categories of contractual damages that may be available for financial loss (pecuniary loss), ie expectation-based damages, reliance-based damages and gains-based damages.

For guidance on contractual damages generally, see Practice Note: Contractual damages—general principles.

For guidance on claiming damages for non-financial loss for breach of contract, see Practice Note: Contractual damages—non-pecuniary losses.

Contractual damages—categories of pecuniary loss

Recoverable damages in respect of pecuniary losses are:

  1. expectation-based damages (also known as ‘loss of bargain’ damages)

  2. reliance-based damages

  3. consequential loss damages

  4. gains-based damages

Pecuniary loss—expectation-based damages

‘Expectance-based damages’ are generally used for the calculation of damages.

These are awarded to compensate the innocent party and put them back into the same position as they would have been had the contract been satisfactorily performed and the breach had not occurred. The measure of such damages is the net value of the benefit the claimant failed to get.

For example:

  1. they can be based on a claim for potential lost profit, where the seller of a business warrants that the profits of the business will reach a certain level in the course of the next year and they do not (such 'warranty claims' are often considered in the months following a business sale or share purchase, see Practice Note: Starting an SPA breach of warranty claim—a practical guide)

  2. where goods with a certain market value were due to be delivered for

Related documents:

Popular documents