Breach of Contract Damages Calculator
Contract damages aim to put the non-breaching party in the position they would have been in had the contract been performed. The four core categories — expectation, reliance, restitution, and consequential — each apply to different facts and have different proof requirements.
The Four Damage Theories
Expectation: put plaintiff in position of full performance (cover price minus contract price plus consequential damages). Reliance: put plaintiff in position before contract (out-of-pocket expenses). Restitution: return what defendant received. Consequential: foreseeable special damages beyond direct loss.
Mitigation Duty
Non-breaching party must take reasonable steps to mitigate damages — cannot let losses accumulate. Failure to mitigate reduces recovery by the amount that could have been avoided. Substitute performance (cover) must be reasonably similar and obtained without undue delay.
Foreseeability Limit (Hadley v Baxendale)
Consequential damages are recoverable only if they were foreseeable to both parties at contract formation. Special damages outside ordinary course of business require notice to defendant before breach. This rule is the central limit on consequential damage claims.
Source: Restatement (Second) of Contracts §§346-353; UCC §2-708 to §2-715. Last updated: May 2026.