What Are Compensatory Damages?
When a party files a civil complaint and proves their cause of action (e.g., breach of contract or negligence), the court will usually award them money to fix the harm. The primary category of this money is known as compensatory damages.
The legal philosophy behind compensatory damages is "to make the plaintiff whole." The goal is not to punish the defendant, nor is it to make the plaintiff rich; it is strictly to reimburse the plaintiff so they end up in the exact financial position they would have been in if the defendant had never wronged them.
Types of Compensatory Damages
In Florida real estate and civil litigation, compensatory damages are generally divided into two categories:
- Economic Damages (Special Damages): These are objective, easily calculable out-of-pocket expenses. Examples include repairing a casualty loss to a building, refunding a stolen earnest money deposit, paying for medical bills after a slip-and-fall, or replacing lost rental income due to an illegal eviction.
- Non-Economic Damages (General Damages): These are subjective losses that are harder to calculate but still intended to compensate the plaintiff. Examples include pain and suffering, emotional distress, or loss of reputation (in defamation cases). In standard real estate breach of contract cases, non-economic damages are rarely awarded.
How They Differ from Punitive Damages
Compensatory damages are entirely distinct from punitive damages. While compensatory damages repay the victim for their actual losses, punitive damages are an extra penalty added on top to severely punish the defendant for intentional malice or gross negligence. For example, if a roofer accidentally damages a home, the court will only award compensatory damages to fix the roof. If the roofer intentionally scammed an elderly homeowner out of their life savings, the court may award compensatory damages to return the money, plus massive punitive damages to punish the roofer's fraudulent behavior.
Related Terms
- Damages — The overarching category containing compensatory and punitive types
- Comparative Negligence — A defense that reduces the compensatory damages awarded
- Earnest Money — A common form of economic compensatory damages
Barnes Walker Property Litigation
Barnes Walker's trial attorneys meticulously calculate and prove economic and non-economic compensatory damages to ensure our clients recover every dollar they are owed following a breach of contract or property dispute. Request a legal inquiry for assistance.
Reviewed by the attorneys at Barnes Walker, Goethe, Shea & Robinson, PLLC