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What damages can Floridians seek when a contract is breached?

When two parties in Florida enter into a business contract, they naturally do so with the expectation that the agreement will be honored. After there may have been a great deal of negotiation that went on before the parties reached a final agreement that they were both satisfied with. Moreover, in a business contract each party has the expectation that they will experience some sort of financial advantage. Unfortunately, things do not always run so smoothly, and sometimes business contracts are breached.

When a company is pursuing business litigation based on breach of contract, they may seek financial damages. In fact, financial damages are the most common type of damages sought in such situations. There are several types of financial damages that may be awarded.

First, there are compensatory damages. These are meant to place the aggrieved party in the same position they would have been in had the contract been honored. Then there are punitive damages. The amount of these damages exceeds what would be necessary to make the aggrieved party whole. They are meant to punish the breaching party for their wrongdoing, but they are not a common remedy in the area of business contracts.

Sometimes nominal damages are sought. These are a token award made when the aggrieved party could not prove that they actually suffered some sort of financial loss due to the breach. Finally, there are liquidated damages. These are remedies that are specifically laid out in the terms of the contract itself, and therefore have been agreed upon by both parties. In order to be awarded, however, the amount of liquidated damages set in the contract needs to be a reasonable estimate of what they would be in the event of a breach of contract.

No party to a contract anticipates that the other party will not follow through on it, but it does happen. And, when it does, the aggrieved party may pursue damages. The type of damages awarded is highly dependent on the situation surrounding the breach, so if a party is engaged in business litigation based on breach of contract, they should make sure they understand that the court will take into account the unique facts of their case when deciding what damages are appropriate.

Source: FindLaw, "Breach of Contract and Lawsuits," accessed May 1, 2018

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