Damages in Georgia Contract Disputes

After an alleged breach of contract, damages are a way to rectify the harm done to the aggrieved party. There are multiple types of damages in Georgia contract disputes, including compensatory and punitive damages.

Quantifying damages is a difficult and complex undertaking, requiring help from accounting professionals and skilled attorneys. At Sparks Law, our knowledgeable contract dispute lawyers are here to advise you on seeking the restitution you deserve in your case.

Actual vs. Foreseeable Damages in Contract Breach Cases

In a contract dispute, actual damages refer to what really happened, while foreseeable damages are those that a reasonable person could have anticipated. For instance, say that an agency contracts a performer for an event. The agency was projected to make $50 million from this performance. However, the performer cancels.

The agency could argue for $50 million in actual damages. However, the defendant and their attorney may push that number down, arguing that the agency did not have to pay the various expenses of putting on the show since the event did not occur.

The defendant may also argue that the agency should have foreseen that the performer might not perform and gotten an insurance policy to cover a potential cancellation. This could constitute a foreseeable damage if the performer is notoriously unreliable. In these types of contract disputes, both sides would hire their own experts and attorneys to calculate the foreseeable and actual damages and present their case for the court.

Liquidated Damages in Georgia Contract Cases

Liquidated damages are a good faith estimate of what the damages would be if someone were to breach a contract. In contracts, the liquidated damages section often deals with scenarios that would take significant legal work and costs to prove damages.

Essentially, both parties to a contract could agree on a set amount of damages in the event of a dispute. If one party sues for breach of a contract with a liquidated damages provision, they only need to prove the breach and do not need to prove the amount of damages. In a successful lawsuit, the plaintiff will automatically get the liquidated damages.

Calculating Liquidated Damages for Contract Breaches

Liquidated damages are an estimate that factors in the total value of the contract as well as potential attorney and court fees. It is important to consider legal costs, as these can be significant in contract dispute cases. When drafting a liquidated damages provision for a contract, it is crucial to work with accounting and legal professionals to determine an appropriate amount.

For instance, say a services contract costs a person $5,000, but they stand to gain $10,000 from the whole transaction when figuring in third parties. The person might estimate that it would take $20,000 in legal fees to sue for a potential breach of contract. In this case, the person and their local attorney might set the liquidated damages at $30,000 even though the contract itself only cost $5,000.

Seek Contract Dispute Damages with Help from a Georgia Attorney

If you are involved in a breach of contract case, or if you are entering a legal agreement with another party, consult an attorney at our firm. The lawyers at Sparks Law are experienced at working with accounting experts and accurately valuating damages in Georgia contract disputes. We could also help draft contract provisions to ensure you will receive an appropriate amount of damages should a breach occur. Call us today to discuss your situation.