In today's Freedom Friday blog and email newsletter, I want to talk about a topic that often comes up with my breach of contract clients.  Many times, these kinds of clients wish to maximize their recovery, and so they ask about damages, and how much they can collect or recover, even beyond the actual damages.  So, in today's Freedom Friday blog and email newsletter, I'm answering the question, “Can I sue for damages in a breach of contract case?”

Breach of contract cases usually fall within two broad categories: a party has failed to fulfill their contractual obligations, either by failing to perform as agreed, or by violating specific terms of the agreement.  These breaches can be further divided into two other categories: material breaches which include major violations that significantly affect the purpose of the contract, allowing the other party to sue for damages and/or to terminate the contract; and minor breaches which are less significant violations that do not entirely undermine the contract but still might lead to legal action for damages.  Depending on the type of breach, there are different types of damages which you can sue for in a breach of contract case.  Here are five (5) types of damages which you can sue for in a breach of contract case:

1.  Actual Damages

The first type of damages which you can sue for in a breach of contract case is actual damages, also known as compensatory damages.  Actual damages are designed to make the non-breaching party whole, to put the other party in the position they would have been in if the contract had been fulfilled.  Actual damages include direct damages such as financial losses caused by the breach like unpaid invoices, lost revenues, and additional costs incurred.  Actual damages also include consequential damages which are losses resulting from the breach but not directly tied to the contract like lost business opportunities.

2.    Liquidated Damages

The second type of damages which you can sue for in a breach of contract case is liquidated damages.  This can include direct actual damages, but if the contract includes a liquidated damages clause, it can also include a predetermined amount of damages which must be paid if the contract is breached.

3.    Punitive Damages

The third type of damages which you can sue for in a breach of contract case is punitive damages.  Punitive damages are rarely awarded in a breach of contract case unless the breach involves fraud, gross negligence, or some kind of intentional malice on the part of the breaching party.  Obviously, the point of punitive damages is to punish wrongful conduct and deter such from occurring again.

4.    Specific Performance

The fourth type of damages which you can sue for in a breach of contract case is specific performance.  Sometimes instead of money damages a court may order specific performance and require the breaching party to fulfill its obligations.  This type of damages is often seen in cases involving unique goods, real estate transactions, and intellectual property cases.

5.    Attorney Fees and Court Costs

In Oklahoma, attorney fees are not automatic in a breach of contract case, but they are available to a prevailing party if the contract has a prevailing party attorney fees clause, or if the contract involves one of several categories, such as labor, services rendered, open account, notes, negotiable instruments, or sale of goods.  Court costs are usually available to the prevailing party, especially if the contract specifies so, but attorney fees are usually awarded by separate application after a judgment is rendered.

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