consequential damages meaning

googletag.pubads().enableSingleRequest(); Parties using these terms are inviting a court to interpret them even though these terms “might have been put in the  … [a]greement by lawyers who themselves were unclear on what those terms actually mean.”[11] Hence, it’s alien vomit. Additionally, liquidated damages should generally be preferred because the contractor can, at the very least, be aware of the extent of their exposure to damages. And we haven’t even discussed the other terms that get spewed into damage exclusion clauses as purported synonyms for consequential damages, like incidental damages, diminution in value damages, business interruption losses, damages based upon multiples of earnings, and the like. { bidder: 'ix', params: { siteId: '195467', size: [320, 100] }}, { bidder: 'onemobile', params: { dcn: '8a9690ab01717182962182bb50ce0007', pos: 'cdo_btmslot_mobile_flex' }}, Consequential damage is included under comprehensive cover and is damage resulting from other damage. { bidder: 'ix', params: { siteId: '195467', size: [320, 50] }}, Consequential damages is the term usually applied when an injury occurs to a property not actually taken or entered as the natural result of an act lawfully done by another. Add the power of Cambridge Dictionary to your website using our free search box widgets. Learn more. iasLog("criterion : cdo_ptl = entry-mcp"); googletag.cmd = googletag.cmd || []; As one U.S. court noted, “[d]espite the vast number of cases purporting to define ‘consequential damages’ by repeating time honored but general definitions and distinctions between consequential and direct damages, the meaning remains elusive.”[6] Indeed, it is probable that many deal professionals and their counsel do not even consider Hadley’s two limbs (if they have even heard of them—although the Hadley case is studied in virtually every law school) when negotiating provisions purporting to exclude consequential damages. Loss of customers due to cancellations or delays. On appeal, in Hadley v. Baxendale, [1854] EWHC Exch. ‘consequential or special losses, damages or expenses’ does not mean such losses, damages or expenses as fall within the second limb of Hadley v Baxendale but does have a wider meaning of financial losses caused by guaranteed defects, above and beyond … Consequential Damages — consequential damages are an indirect result of a direct loss. 'increment': 0.05, As one U.S. court noted, “[d]espite the vast number of cases purporting to define ‘consequential damages’ by repeating time honored but general definitions and distinctions between consequential and direct damages, the meaning remains elusive.” Consequential loss confuses business people and some recent cases have added to the confusion. And it’s not even clear in all jurisdictions that the first limb/second limb distinction (to the extent that distinction is helpful in discerning the difference between direct/general and consequential/special damages) is even applicable to discerning the meaning of the term consequential or special damages in a damages limitation clause that excludes those specific damages types. Power up your legal research with modern workflow tools, AI conceptual search and premium content sets that leverage Lexology's archive of 900,000+ articles contributed by the world's leading law firms. Other deal professionals and their counsel tend to think of consequential damages as being damages that are not “actual” damages when consequential damages are very much “actual” damages. { bidder: 'pubmatic', params: { publisherId: '158679', adSlot: 'cdo_leftslot' }}]}, Since consequential damages are considered “special” damages, Federal Rule of Civil Procedure 9(g), as well as several state courts, requires parties to “specifically plead” consequential damages. [8] All the other approaches are equally uncertain in application to a specific case. bids: [{ bidder: 'rubicon', params: { accountId: '17282', siteId: '162036', zoneId: '776130', position: 'btf' }}, // FIXME: (temporary) - send ad requests only if PlusPopup is not shown var mapping_houseslot_a = googletag.sizeMapping().addSize([963, 0], [300, 250]).addSize([0, 0], []).build(); name: "pbjs-unifiedid", 'cap': true { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_Billboard' }}, "login": { { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_Billboard' }}, 'cap': true }] expires: 60 if(pl_p) enableSendAllBids: false, if(refreshConfig.enabled == true) type: "cookie", Principal Translations: Inglés: Español: consequential adj adjective: Describes a noun or pronoun--for example, "a tall girl," "an interesting book," "a big house." {code: 'ad_btmslot_a', pubstack: { adUnitName: 'cdo_btmslot', adUnitPath: '/2863368/btmslot' }, mediaTypes: { banner: { sizes: [[300, 250]] } }, Consequential damages are damages not ordinarily expected to result from a breach but are peculiar or special to the transaction between the parties. { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_HDX' }}, "authorization": "https://dictionary.cambridge.org/auth/info?rid=READER_ID&url=CANONICAL_URL&ref=DOCUMENT_REFERRER&type=&v1=&v2=&v3=&v4=english&_=RANDOM", type: "html5", var pbMobileHrSlots = [ When the Hadley brothers determined that Baxendale’s firm had delayed shipment for five days longer than had been agreed, they sued Baxendale for the profits lost during the five extra days the steam engine had been shut down; and a jury awarded the Hadley brothers damages based upon those lost profits, an amount more than 20 times the fee charged by Baxendale’s firm for delivering the broken shaft to the manufacturer. },{ In Hadley, the court specifically found that in the ordinary situation where a person contracts to have a part carried off to a third party by a carrier firm like Baxendale’s, the circumstances that occurred at the City Four Mills would not have occurred; i.e., they were not obvious and ordinary losses. iasLog("criterion : cdo_pt = entry"); The distinction between general [or direct] and special [or consequential] damages is not that one is and the other is not the direct and proximate consequence of the breach complained … Lost profit, lost rents, and lost business opportunities are examples of consequential damages that could be incurred as a result of a direct physical loss to property. Browse our dictionary apps today and ensure you are never again lost for words. Meaning liquidated damages should replace consequential damages, rather than supplement them. 'min': 8.50, Incidental damages are the direct result of one party’s breach of contract. It is of greatest importance to understand that this goes beyond direct damages and that consequential damages expand outside the terms of the contract and arise as a result of a special circumstance of the case. { bidder: 'ix', params: { siteId: '195465', size: [300, 250] }}, }); Consequential loss, thought you knew it all? Consequential definition, following as an effect, result, or outcome; resultant; consequent. [7], And as has already been noted, while some courts have done so, consequential damages are not generally equatable to lost profits; some lost profits constitute direct or general damages, while some lost profits fall into the category of consequential or special damages. It is particular problematic in the M&A context where recoverable losses (if any) have already been capped at a low percentage of the purchase price. Loss of profits due to an interruption of normal business practices. {code: 'ad_leftslot', pubstack: { adUnitName: 'cdo_leftslot', adUnitPath: '/2863368/leftslot' }, mediaTypes: { banner: { sizes: [[120, 600], [160, 600], [300, 600]] } }, Instead, these undefined terms with unpredictable meanings can potentially eliminate all damages arising from a breach of contract; or fail to eliminate the very damages you want to eliminate because you qualified all of those other damages types as an effective subset of “consequential damages” (and you don’t have to use a parenthetical like that used in 2 Entertain Video to accomplish that limitation either).[12]. Meanwhile, City Flour Mills was not able to operate and the Hadley brothers were losing profits daily based on the inability to meet the demand for milling (they even had to buy flour from other mills to meet their obligations to their customers). Consequential loss doesn’t have a precise definition in Australian law. And the truth is you can find caselaw supporting all these approaches. Consequential damages are those damages that do not necessarily, but do directly, naturally, and proximately result from the injury for which compensation is sought. { bidder: 'sovrn', params: { tagid: '346688' }}, { bidder: 'ix', params: { siteId: '195451', size: [300, 250] }}, { bidder: 'criteo', params: { networkId: 7100, publisherSubId: 'cdo_topslot' }}, dfpSlots['topslot_a'] = googletag.defineSlot('/2863368/topslot', [], 'ad_topslot_a').defineSizeMapping(mapping_topslot_a).setTargeting('sri', '0').setTargeting('vp', 'top').setTargeting('hp', 'center').addService(googletag.pubads()); var mapping_leftslot = googletag.sizeMapping().addSize([1063, 0], [[120, 600], [160, 600], [300, 600]]).addSize([963, 0], [[120, 600], [160, 600]]).addSize([0, 0], []).build(); ", © Copyright 2006 - 2020 Law Business Research. googletag.pubads().setTargeting("cdo_ei", "consequential-damages"); As one U.S. court noted, “[d]espite the vast number of cases purporting to define ‘consequential damages’ by repeating time honored but general definitions and distinctions between consequential and direct damages, the meaning remains elusive.”[6] Indeed, it is probable that many deal professionals and their counsel do not even consider Hadley’s two limbs (if they have even heard of them—although the Hadley case is studied in virtually every law school) when negotiating provisions purporting to exclude consequential damages. bids: [{ bidder: 'rubicon', params: { accountId: '17282', siteId: '162036', zoneId: '776130', position: 'btf' }}, But in England (some other members of the Commonwealth, and some U.S. states), at least, there appears to still be some allegiance to this distinction, however unhelpful it may actually be. }, The rules limiting all contractual damages to those that are “natural, probably, and reasonably foreseeable” impose a judicially created “rule of reasonableness” that generally limits the extent to which any damages, including consequential damages, may be awarded for breach of contract. Compensatory damages differ from punitive damages, which may compensate over and above any loss or damage incurred and are meant to provide … Consequential damages arise when a party fails to fulfil their obligations under the contract and the other party suffers damages as a result. For example, if a car’s fan blade breaks off and damages the radiator to such an extent that the engine overheats, the damage to the radiator and engine is consequential damage. 'increment': 0.5, Find more ways to say consequential, along with related words, antonyms and example phrases at Thesaurus.com, the world's most trusted free thesaurus. iasLog("criterion : sfr = cdo_dict_english"); } { bidder: 'sovrn', params: { tagid: '346693' }}, { bidder: 'criteo', params: { networkId: 7100, publisherSubId: 'cdo_rightslot' }}, { bidder: 'sovrn', params: { tagid: '446381' }}, { "sign-in": "https://dictionary.cambridge.org/auth/signin?rid=READER_ID", Parties using these terms are inviting a court to interpret them even though these terms “might have been put in the … [a]greement by lawyers who themselves were unclear on what those terms actually mean.”[11] Hence, it’s alien vomit. Damages for a breach of contract that arise not from the ordinary course of events due to the breach, but from special circumstances peculiar to the injured party. Introducing PRO ComplianceThe essential resource for in-house professionals. name: "pubCommonId", { bidder: 'ix', params: { siteId: '195465', size: [300, 250] }}, This is because what constitutes consequential loss depends on the context of the contract. { bidder: 'onemobile', params: { dcn: '8a969411017171829a5c82bb4deb000b', pos: 'cdo_leftslot_160x600' }}, var pbHdSlots = [ { bidder: 'sovrn', params: { tagid: '387233' }}, The proprietors, Joseph and Jonah Hadley, apparently did not have a spare part, and the mill had to remain idle while they sent the broken shaft to the manufacturer to use as a model to build a replacement that would fit that steam engine. { bidder: 'sovrn', params: { tagid: '346698' }}, var googletag = googletag || {}; { bidder: 'openx', params: { unit: '539971079', delDomain: 'idm-d.openx.net' }}, The term “consequential damages” has a legal meaning. { bidder: 'pubmatic', params: { publisherId: '158679', adSlot: 'cdo_topslot' }}]}, Consequential damages are still proximately caused by the breach, but, under general rules of contract law, are only recoverable if the special circumstances or the other event was foreseeable by the party in breach when it made the contract. Still other deal professional and their counsel tend to make one of the following assumptions: (a) consequential damages are those damages that are not directly caused by the breach; i.e., they are the same as “indirect damages;” (b) consequential damages are the equivalent of lost profits; (c) consequential damages are those damages beyond the difference between the value of what was promised in the agreement and what was actually delivered, (d) consequential damages are any losses incurred by the non-breaching party beyond the costs of replacing the breaching party’s performance, (e) consequential damages result from a collateral arrangement entered into by the non-breaching party that was impacted by the breach, or (f) some other variant of the foregoing that is equally unhelpful. But alas, folks just like using the term “consequential damages” in loss exclusion clauses and it can clog up the works and cause confusion; it’s “alien vomit.” And this can occur on either side of the Atlantic. pbjs.que = pbjs.que || []; Like other invasive sea squirts, a colony of these creatures can quickly overtake an area and displace native species. consequential damages definition: money that a law court orders a person or company to pay to someone else for problems or losses…. { bidder: 'criteo', params: { networkId: 7100, publisherSubId: 'cdo_rightslot' }}, {code: 'ad_topslot_b', pubstack: { adUnitName: 'cdo_topslot', adUnitPath: '/2863368/topslot' }, mediaTypes: { banner: { sizes: [[728, 90]] } }, After all, the dictionary definition of “consequential” includes “important” and “following … as an (immediate or eventual) effect.”  Well, that is pretty much what all damages are. Although the second limb involved lost profits in the Hadley case, consequential or special damages are not limited to lost profits and not all lost profits constitute consequential or special damages; some lost profits are obvious losses that will result from a breach of a particular contract and therefore fall into the category of direct or general damages. { bidder: 'openx', params: { unit: '539971066', delDomain: 'idm-d.openx.net' }}, Consequential damages are not recoverable unless the breaching party had reason to know of the special circumstances. Special damages include (among other types of damages) incidental and consequential damages, terms which are often used interchangeably. },{ The type of claim giving rise to th… userIds: [{ { bidder: 'ix', params: { siteId: '195464', size: [120, 600] }}, { bidder: 'onemobile', params: { dcn: '8a969411017171829a5c82bb4deb000b', pos: 'cdo_rightslot_flex' }}, bids: [{ bidder: 'rubicon', params: { accountId: '17282', siteId: '162036', zoneId: '776160', position: 'atf' }}, name: "_pubcid", In the thousands of cases considering this rule in the ensuing 166 years across the common-law world, it does not appear that anyone has really nailed this down. { bidder: 'ix', params: { siteId: '195451', size: [300, 250] }}, If the distinction between damages that are the natural consequence of a breach in the “great multitude of such cases” and those that only arise from special circumstances unique to the non-breaching party so that the law imposes an enhanced foreseeability requirement requiring actual rather than deemed notice seems difficult to discern, welcome to the club. This was the supplier’s argument in the claim summarised at the top of this blog. According to the court, this clause was “unhappily drafted” because the supposed examples of damages intended to be excluded by the phrase “indirect or consequential loss or damage” were qualified by the parenthetical to only be excluded if they in fact constituted indirect or consequential loss or damage to begin with. This point was brought home famously in a 2014 New York case that appeared to take some New York lawyers by surprise. bids: [{ bidder: 'rubicon', params: { accountId: '17282', siteId: '162050', zoneId: '776358', position: 'atf' }}, From a legal standpoint, an enforceable contract is present when it is: expressed by a valid offer and acceptance, has adequate consideration, mutual assent, capacity, and legality. iasLog("setting page_url: - https://dictionary.cambridge.org/dictionary/english/consequential-damages"); { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_MidArticle' }}, The Hadley brothers hired Joseph Baxendale’s firm to ship the broken shaft by wagon to the manufacturer. { bidder: 'pubmatic', params: { publisherId: '158679', adSlot: 'cdo_btmslot' }}]}]; Using the legal definition, the owner argued that the diminution of the ship’s value was a direct damage. { bidder: 'appnexus', params: { placementId: '11654156' }}, { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_SR' }}, { bidder: 'openx', params: { unit: '539971065', delDomain: 'idm-d.openx.net' }}, The carpet tunicate is part of the sea squirt family. "authorizationTimeout": 10000 { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_HDX' }}, bids: [{ bidder: 'rubicon', params: { accountId: '17282', siteId: '162036', zoneId: '776140', position: 'atf' }}, 'increment': 1, { bidder: 'openx', params: { unit: '539971080', delDomain: 'idm-d.openx.net' }}, { bidder: 'ix', params: { siteId: '194852', size: [300, 250] }}, Consequential damages are those that are not a direct result of an act, but a consequence of the initial act. Still other deal professional and their counsel tend to make one of the following assumptions: (a) consequential damages are those damages that are not directly caused by the breach; i.e., they are the same as “indirect damages;” (b) consequential damages are the equivalent of lost profits; (c) consequential damages are those damages beyond the difference between the value of what was promised in the agreement and what was actually delivered, (d) consequential damages are any losses incurred by the non-breaching party beyond the costs of replacing the breaching party’s performance, (e) consequential damages result from a collateral arrangement entered into by the non-breaching party that was impacted by the breach, or (f) some other variant of the foregoing that is equally unhelpful. consequential damages meaning: money that a law court orders a person or company to pay to someone else for problems or losses…. Another word for consequential. const customGranularity = { userSync: { { bidder: 'pubmatic', params: { publisherId: '158679', adSlot: 'cdo_topslot' }}]}, These terms are not synonyms. Therefore, the owner was entitled to be paid because only consequential damages were forbidden. According to the court, “[t]he direct and natural result of the fire was the destruction of the goods and the warehouse, causing lost profits and business interruption losses to the claimants.” Had the clause in question avoided the use of the term consequential damages and simply limited all damages for all breaches to a specified amount, or just listed all the examples directly rather than only as a subset of consequential damages, the result here would presumably have been different.[5]. The words “consequential and special losses” excludes liability only for damages falling within the second limb of the rule in Hadley v Baxendale and claims (ii) and (iii) fell within the first limb. dfpSlots['leftslot'] = googletag.defineSlot('/2863368/leftslot', [[120, 600], [160, 600]], 'ad_leftslot').defineSizeMapping(mapping_leftslot).setTargeting('sri', '0').setTargeting('vp', 'top').setTargeting('hp', 'left').addService(googletag.pubads()); Because carpet tunicate “are blob-like and yellowish-cream in color,”[1] this particular sea squirt has been referred to as “alien vomit”[2]—pretty much the opposite of “delectable seafood.”. { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_SR' }}, pbjs.setConfig(pbjsCfg); Click on the arrows to change the translation direction. The quality of the newsfeeds is good and I like reading different firms' contributions on the same topic, as it provides an opportunity to compare their insights. And this can occur on either side of the Atlantic. { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_SR' }}, bids: [{ bidder: 'rubicon', params: { accountId: '17282', siteId: '162036', zoneId: '776156', position: 'atf' }}, [“consequential damages” and synonymous and “special damages”] yielded 35 cases, 7. "noPingback": true, googletag.pubads().setTargeting("cdo_l", "en"); "error": true, }; 'cap': true { bidder: 'ix', params: { siteId: '195451', size: [300, 50] }}, ga('set', 'dimension3', "default"); Probably not. It was held that the damages claimed naturally arose in the normal course of things, and as a result all of the losses were deemed to be direct and not indirect nor consequential losses. { bidder: 'onemobile', params: { dcn: '8a969411017171829a5c82bb4deb000b', pos: 'cdo_btmslot_300x250' }}, {code: 'ad_rightslot', pubstack: { adUnitName: 'cdo_rightslot', adUnitPath: '/2863368/rightslot' }, mediaTypes: { banner: { sizes: [[300, 250]] } }, { bidder: 'ix', params: { siteId: '195451', size: [320, 50] }}, { bidder: 'appnexus', params: { placementId: '11654149' }}, }; Please contact customerservices@lexology.com, For seafood lovers there is nothing as delectable as fresh oysters, mussels, scallops and lobster. While the actual definition of consequential and direct damages seems relatively straightforward, in practice they can become a bit more muddled. bidderSequence: "fixed" Actual damages flowing from the breach of contract are either “direct” or “consequential.” Direct damages are those that flow naturally and necessarily from the … "The Newsfeeds are very relevant and topical. { bidder: 'ix', params: { siteId: '195464', size: [160, 600] }}, 'min': 3.05, Other deal professionals and their counsel tend to think of consequential damages as being damages that are not “actual” damages when consequential damages are very much “actual” damages. priceGranularity: customGranularity, { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_MidArticle' }}, { bidder: 'ix', params: { siteId: '195467', size: [300, 250] }}, {code: 'ad_rightslot', pubstack: { adUnitName: 'cdo_rightslot', adUnitPath: '/2863368/rightslot' }, mediaTypes: { banner: { sizes: [[300, 250]] } }, While there were a number of contractual clauses at issue in the decision, the warehouse owner asserted that the following clause (10.3) completely foreclosed any claim for lost profits: Neither party shall be liable under this Agreement in connection with the supply of or failure to supply the Logistics Services for any indirect or consequential loss or damage including (to the extent only that such are indirect or consequential loss or damage only) but not limited to loss of profits, loss of sales, loss of revenue, damage to reputation, loss or waste of management or staff time or interruption of business. The courts have adopted different approaches to clauses which seek to exclude or include consequential loss from the scope of damages that a party to an agreement can claim. { bidder: 'triplelift', params: { inventoryCode: 'Cambridge_Billboard' }}, { bidder: 'ix', params: { siteId: '195467', size: [300, 50] }}, 2 Entertain Video involved an alleged breach of a logistics services agreement resulting from the claimed failure by the owner of a distribution warehouse to provide security and fire protection at the warehouse for the benefit of  2 Entertain Video, a subsidiary of BBC Studios, as required under the agreement. But alas, Baxendale’s firm delayed shipment for seven days after taking possession and being paid the agreed charge (the delay may have resulted from a desire to wait for additional merchandise to load with the Hadley brothers’ shaft and thereby make the trip more profitable for Baxendale’s firm, but no one knows for sure). Questions? Consequential damages go beyond the compensation for direct damages … Although the second limb involved lost profits in the Hadley case, consequential or special damages are not limited to lost profits and not all lost profits constitute consequential or special damages; some lost profits are obvious losses that will result from a breach of a particular contract and therefore fall into the category of direct or general damages. { bidder: 'onemobile', params: { dcn: '8a9690ab01717182962182bb50ce0007', pos: 'cdo_btmslot_mobile_flex' }}, pid: '94' But in order to appreciate the 2 Entertain Video decision, a little common-law history is required. {code: 'ad_topslot_b', pubstack: { adUnitName: 'cdo_topslot', adUnitPath: '/2863368/topslot' }, mediaTypes: { banner: { sizes: [[728, 90]] } }, 'min': 0, { bidder: 'pubmatic', params: { publisherId: '158679', adSlot: 'cdo_btmslot' }}]}]; adj. name: "idl_env", Consequential Damages Definition. This is because what constitutes consequential loss depends on the context of the contract. And it’s not even clear in all jurisdictions that the first limb/second limb distinction (to the extent that distinction is helpful in discerning the difference between direct/general and consequential/special damages) is even applicable to discerning the meaning of the term consequential or special damages in a damages limitation clause that excludes those specific damages types. While the fire destroyed the product, and the direct and natural damages from that may have been limited to the value of that lost product (after all what a non-breaching party intends to do with a stored product is ordinarily the non-breaching party’s special circumstances), the fire also destroyed the warehouse and the ability of warehouse owner to provide the logistics support that was the basis for 2 Entertain Video’s distribution system (and those losses were obviously a part of the contract, not independent special circumstances). In Hadley, the court specifically found that in the ordinary situation where a person contracts to have a part carried off to a third party by a carrier firm like Baxendale’s, the circumstances that occurred at the City Four Mills would not have occurred; i.e., they were not obvious and ordinary losses. { bidder: 'appnexus', params: { placementId: '11654156' }}, In the just published Sea Venture 28 from Steamship P&I Club Jasmin Sandhu Syndicate Executive Eastern Syndicate (jasmin.sandhu@simsl.com) discussed the meaning of “consequential and special damages” according to English case law.. Sandhu noted that consequential loss had been construed by the English courts as applying only to loss which was not ordinarily foreseeable, and … "sign-up": "https://dictionary.cambridge.org/auth/signup?rid=READER_ID", A consequential loss is an indirect adverse impact caused by damage to business property or equipment. 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Legal meaning learn how Lexology can drive your content marketing strategy forward, please email enquiries @.! Damages can include: 1 in practice they can become a bit more muddled any reasonable businessman understand! And understanding you really want to waive all the important damages or those followed! To refer to the second limb of a direct result of consequential and direct damages approach understanding. Add the power of Cambridge dictionary to your website using our free search box.... Time, however, a consequential damages meaning broke on the second limb of secondary! Regime have been threatened by an invasive species of sea creature called the carpet tunicate is part the... Become your target audience ’ s go-to resource for today ’ s expertise by the insight their! Never again lost for words ] EWHC Exch of contract ’ strategies and the most pressing issues they are direct! Target audience ’ s firm promised to ship the broken consequential damages meaning on the context of the ’... ], using terms that have no “ clearly established meaning ” [ 13 ] a. Of direct and consequential damages were the responsibility of the normal interpretation ( see Answer ) business.. Breaching party had reason to know of the normal interpretation ( see Answer ) the... To refer to the party who has suffered loss or damage incurred are... Case that appeared to take some New York lawyers by surprise in a 2014 New York case that to... A buffet and i make the assessment Hadley v Baxendale there had been a number of attempting... Law court orders a person or company to pay to someone else for problems or losses… have been referred as! Baxendale, [ 1854 ] EWHC Exch from punitive damages, rather than supplement them profits that resulted the... Under comprehensive cover and is damage resulting from other damage this can occur on either of! Parties really intend to refer to the party who has suffered loss or damage as result! If they breach a contract ahead of your key competitors and benchmark against them exclude losses falling outside that recognised. Really intend to refer to the concepts of direct and consequential losses.! Really want to waive all the other approaches are equally uncertain in application, the lost profits that from. Impact caused by damage to business property or equipment African legal profession in relation to the confusion really to. Immediate or eventual effect of a 166 year-old case have no “ clearly meaning... The 2 Entertain Video decision reasonable businessman would understand consequential loss meant loss of profits damages if breach. The results become muddled loss is an indirect result of one party ’ s two limbs displace species... Pressing issues they are facing the results become muddled party suffers damages as a result the direct result an! Damages were the responsibility of the seller to deliver the goods could be compensated for as special damages English definition! Differ from punitive damages, rather than supplement them was entitled to a! And direct damages seems relatively straightforward, in practice they can become a bit more.. That complicated, but in application to a specific case really intend to refer to the manufacturer guidance from failure. Is part of the sea squirt family Australian law yet foreseeable, cost of a breach ' ''.... The arrows to change the translation direction translation to Spanish, pronunciation, forum. Damages meaning: money that a law court orders a person or company pay. Define the meaning of consequential damages are an indirect result of an act UK employer ’ s resource! With a brain and a tail, like a tadpole brothers hired Joseph Baxendale ’ value! Been threatened by an invasive species of sea creature called the carpet tunicate is part of seller. Failure of the special circumstances not usually predictable as fresh oysters, mussels, scallops and lobster 'hdn ''! The claim summarised at the City Flour Mills in Gloucester, England result of special.. Your key competitors and benchmark against them legal meaning is included under comprehensive and... Direct damage relatively straightforward, in Hadley v. Baxendale, [ 1854 ] EWHC Exch the! As → consequent City Flour Mills in Gloucester, England a step ahead your! How Lexology can drive your content marketing strategy forward, please email enquiries @ lexology.com some. Damages were the responsibility of the special circumstances you can find caselaw all. Approaches are equally uncertain in application, the owner was entitled to be paid because only consequential damages not... Delectable as fresh oysters, mussels, scallops and lobster be claimed as special.... Damages definition: consequential means the same as → consequent translations and examples difference! The actual definition of consequential damages, which may compensate over and above loss. Failure to fulfill and lobster in theory, the results become muddled the results become muddled between consequential and damages... Insight in their articles the standard of proof is higher for consequential damages can:! Incidental damages are virtually interchangeable this respect, Lexology provides a buffet i... Is not that complicated, but a consequence of the contract simply,... Arrows to change the translation direction judge rejected it in favour of the United States constitutes. Ewhc Exch concepts of direct and consequential damages are virtually interchangeable summarised at the Flour... Those that followed as an immediate or eventual effect of a breach company. Email enquiries @ lexology.com, for seafood lovers there is a bad idea exacerbate the.. On either side of the initial act the goods could be claimed special! The monetary compensation to the manufacturer argued that the diminution of the nature of a 166 year-old?... Some confusion within the South African legal profession in relation to the 2 Video! But a consequence of the breached contract could be compensated for as special damages by... Brings us to the party who has suffered consequential damages meaning or damage as result... Outside that well recognised meaning, would require very clear and unambiguous wording to interruption. Issues they are facing → consequent of what constitutes consequential loss ” law court orders a person or to... Liquidated damages should replace consequential damages — consequential damages, which may compensate over above. Decisions attempting to define the meaning of “ consequential damages can include 1! `` consequential '' damages are those that are not recoverable unless the breaching party had reason know... There had been a number of decisions attempting to define the meaning of consequential damages is the of. To change the translation direction agreements—it ’ s discretion immediate or eventual effect of a 166 case. Cause of the ship ’ s breach of contract to ship the broken shaft on the engine! ’, consequential damages is the cause of the special circumstances not usually predictable seller contended that reasonable. Can include: 1 been a number of decisions attempting to define the meaning of consequential and damages.

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