Types of Damages in Contract Law

The video tutorial explains various types of damages in contract law, including compensatory, consequential, liquidated, and nominal damages. It discusses how these damages are calculated and applied in cases of contract breaches. The tutorial also covers specific performance and rescission as remedies, highlighting when they are applicable. Examples are provided to illustrate each type of damage and remedy.

What do compensatory damages aim to cover in a breach of contract?

• Emotional distress caused by the breach

• Future profits expected from the contract

• The actual losses and additional costs incurred

• Punitive measures against the breaching party

Which of the following best describes consequential damages?

• Damages that are meant to punish the breaching party

• Damages that are agreed upon before the breach occurs

• Damages that naturally result from the breach

• Damages that are explicitly stated in the contract

What is the purpose of a liquidated damages clause in a contract?

• To punish the breaching party

• To estimate potential damages in case of a breach

• To ensure the contract is fulfilled

• To provide emotional compensation

When might a court award nominal damages?

• When actual damages are significant

• When no specific damages can be determined

• When the breach was intentional

• When the contract includes a liquidated damages clause

In what situation might a court order specific performance?

• When the contract is for a future service

• When the subject of the contract is irreplaceable

• When the contract involves a service

• When the contract involves a replaceable good

What does rescission of a contract entail?

• Undoing the contract and returning to original positions

• Continuing the contract under new terms

• Awarding damages to the non-breaching party

• Punishing the breaching party

Why might a court not order specific performance in a services contract?

• Because the service might not be performed well

• Because it is not legally enforceable

• Because services are easily replaceable

• Because it is too costly