Special damages

The basic principles of contract Go Premium Formation: capacity and authority · representation · misrepresentation · offer · acceptance · consideration · intention to create legal relations · agreement to agree · privity of contract oral vs written contract · principal · agent Interpretation and change: governing law · mistake · implied term · amendment · assignment · novation Performance: force majeure · promise · waiver · warranty · covenant · sovereign immunity · illegality · severability · good faith · commercially reasonable manner · commercial imperative · indemnity · guarantee Breach: breach · repudiation · causation · remoteness of damage · direct loss · consequential loss · foreseeability · damages · contractual negligence · process agent Remedies: damages · adequacy of damages ·equitable remedies · injunction · specific performance · limited recourse · rescission · estoppel · concurrent liability Not contracts: Restitution — quasi-contract — quasi-agency Index: Click ᐅ to expand: Contract Tort Restitution Comments? Questions? Suggestions? Requests? Insults? We’d love to 📧 hear from you. Sign up for our newsletter.

Special damages are damages the court awards you for the consequential or indirect losses it suffers upon a breach of contract. Compare with general damages which are the damages a court awards as a result of direct losses arising upon a breach of contract.

Remember, folks: “damages” are payment orders made by a court. You don’t suffer damages. You get paid damages if you suffer a loss. Well, an actionable one, any way.

Legal eagles are apt to confuse “losses” and “damages”, probably because “damage” is, in muggle-speak, a synonym for “loss”. In any case: consequential loss, indirect loss, special damages, consequential damages, indirect damages, special loss: all the same thing.

“Proof of special damages”

We have seen this magnificent formulation in, of course, a non-disclosure agreement:

No proof of special damages shall be necessary for the enforcement by either Party of the rights under this Agreement

This is quite the eagley exercise in stating the bleeding obvious: proof of special damages is never required to enforce a contract: generally special damages are not even available for breach of contract. We think this comes from the confusion and nervousness all shutter-uppers have about the basic lack of value of an NDA. It is generally the case under an NDA that it is hard to prove loss for which any kind of damages, special or otherwise, would be payable, and what the aggrieved party is really after is anb equitable remedy such as an order of specific performance of the contract (i.e., a general direction from the court to shut up would you) or an injunction (a specific order from the court not to blab to an identified person or in an identified way. The best we can offer is that this contract means, therefore:

No proof of loss shall be necessary for the enforcement by either Party of the rights under this Agreement.

See also

• Consequential loss
• Damages