Contracts form the backbone of many business dealings in the Hackensack area. For this reason, when one party to a contract does not fulfill their obligations under the agreement, it could spell financial disaster to the other party. When this happens, the aggrieved party may want to purse compensation through a breach of contract claim.
With regards to financial compensation in a breach of contract claim, there are several types of damages that may be pursued. The most common type of damages that may be sought are compensatory damages. In this type of award, the breaching party is ordered to pay the other party what they would reasonably need to obtain what they were promised in the contract from another business.
Sometimes an award of restitution may be appropriate. Through restitution, the breaching party is ordered to pay what is necessary to put the aggrieved party back in the position they were in prior to the contract, based on the aggrieved party’s performance of their contractual obligations.
In some cases, punitive damages may be awarded. As their name implies, punitive damages serve as a punishment. However, they will generally only apply if the breaching party committed some sort of morally reprehensible act.
Sometimes the contract itself provides a remedy. Liquidated damages are those that the parties agree to in the terms of the contract should the agreement be breached.
Finally, the aggrieved party may pursue payment under the legal doctrine of “quantum meruit.” This means that they will be compensated for any work, even partial work, performed prior to the breach.
As you can see, there are a variety of ways to pursue financial compensation in a breach of contract claim. However, this general overview of compensatory damages only scratches the surface of the topic and does not contain legal advice. Attorneys in New Jersey may be a useful resource to those who believe they have a breach of contract claim and want to pursue damages.