You are required to take reasonable steps to mitigate the damages incurred by the breach of contract.
Denver, CO – A contract is a legally-binding agreement under which one party promises to do something in return for a benefit, usually a monetary one. You can enter various types of contracts, not only written ones. Verbal and implied contracts can also be enforceable by law.
Breach of contract refers to a situation when one of the parties to the contract fails to perform under the specific terms of the agreement. In a business environment, breach of contract can refer to failure to deliver certain items or failure to pay the agreed price.
If you find yourself in such a situation, you must talk to knowledgeable Denver breach of contract lawyers. You may be entitled to file a breach of contract lawsuit, but only if you prove certain elements, such as:
- There was a legally-binding contract between you and the other party
- You performed your end of the deal
- The other party failed to perform their obligations under the terms of the contract
- You sustained financial damages as a result of their failure to meet their obligations.
What kind of damages can you recover in a breach of contract lawsuit?
There are several types of remedies available for breach or breach of contract, but in most cases, you’ll only receive compensatory damages. As the name indicates, the monetary award is intended to “make you whole” or compensate you for the actual financial losses you incurred.
You may be entitled to recover two kinds of compensatory damages:
This sort of remedy refers to your direct financial loss generated by the breach of contract. As an example, let’s say your company ordered a certain number of items, such as production equipment, from the other party. However, by the due date, the other party delivered items that did not correspond to your specifications or were of poor quality, making them unusable. As a result, you were unable to start production and failed to meet your obligations to a third party, with the ensuing financial losses.
Under general damages you can get a refund of the money you paid to have the equipment delivered.
Next, your Denver lawyers will have to calculate the value of your special damages, also known as consequential damages. These are meant to cover any losses generated by your failure to meet your obligations to a third party. You did not receive the right equipment so you were unable to start producing the items you had promised to that third party.
You must also keep in mind the mitigation clause. You are required to take reasonable steps to mitigate the damages incurred by the breach of contract. You cannot simply sit and wait for the defendant in the lawsuit to pay for mounting damages.
Under Colorado statutes, you are entitled to recover liquidated damages only if provisions for this type of monetary award are included in the contract.
Can I get punitive damages for breach of contract?
In Colorado, punitive damages are rarely allowed in a breach of contract lawsuit. As a general rule, punitive damages are mostly awarded in tort cases and only if the plaintiff can prove that the defendant acted with malicious or fraudulent intent. That does not mean you can never get exemplary damages. You will however need seasoned attorneys to prove that the other party acted with evil intent.