Ten important rules for measuring the damages suffered by the aggrieved party

Important rules for measuring the damages suffered by the aggrieved party are:

1. The damages are awarded by way of compensation for the loss suffered by the aggrieved party and not for the purpose of punishing the guilty party for the breach.

2. The injured party is to be placed in the same position, so far as money can do, as if the contract had been performed.

3. The aggrieved party can recover by way of compensation only the actual loss suffered by him, arising naturally in the usual course of things from the breach itself.

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4. Special or remote damages, i.e., damages which are not the natural and probable consequence of the breach are usually not allowed until they are in the knowledge of both the parties at the time of entering into the contract.

5. The fact that damages are difficult to assess does not prevent the in­jured party from recovering them.

6. When no real loss arises from the breach of contract, only nominal damages are awarded.

7. If the parties fix up in advance the sum payable as damages in case of breach of contract, the court will allow only reasonable compensation so as to cover the actual loss sustained, not exceeding the amount so named in the contract.

8. Exemplary damages cannot be awarded for breach of contract except in case of breach of contract of marriage or wrongful refusal by the bank to honour the customer’s cheque.

9. It is the duty of the injured party to minimise the damage suffered.

10. The injured party is entitled to get the costs of getting the decree for damages from the defaulter party.