Compensatory damages

Also known as substantial damages. Damages awarded in respect of the actual losses suffered by the claimant. Their purpose is to compensate the claimant for pecuniary and non-pecuniary losses. Pecuniary losses generally include the gains prevented by the breach of contract or tort, expenses caused by the breach of contract or tort and expenses rendered futile by the breach of contract or tort. Non-pecuniary losses generally include pain and suffering and loss of amenity and mental distress.

Compensatory damages may be contrasted with damages which are not strictly compensatory because, for example, the claimant may have suffered damage but cannot prove actual loss or they have suffered no loss but the breach of contract or duty results in a benefit to the wrongdoer. Examples of this type of damages include nominal damages, exemplary damages, restitutionary damages and liquidated damages.