October 8, 2018
Florida Court Reviews Entitlement to Damages in Contract Case
A Florida court recently considered at least some of the types of damages that a party may be entitled to in a breach of contract case. There, the plaintiffs sued a contractor company for breach of contract after the contractor allegedly walked off a home construction job. The plaintiffs sought damages to put them in the position they would have occupied had they never contracted with the contractor. The plaintiffs sought damages that included payments they made to the contractor under the contract, payments they made for updated architectural plans, certain other expenses, and a loss of equity in their home. At trial, the trial court found the contractor breached the contract but declined to award plaintiffs the above damages.
On appeal, the appellate court stated that there are different types of damages for a breach of contract. The appellate court stated that “When a party seeks damages for a total breach, ‘[h]e may treat the contract as void and seek the damages that will restore him to the position he was in immediately prior to entering the contract.’” The appellate court additionally stated that “Or, in the alternative, he may instead ‘affirm the contract, insist upon the benefit of his bargain, and seek the damages that would place him in the position he would have been in had the contract been completely performed.’” The appellate court stated that in “the case of a breached construction contract” like this one, “the benefit-of-the-bargain remedy is ‘either the reasonable cost of completion, or the difference between the value the construction would have had if completed and the value of the construction that has been thus far performed.’” The appellate court reversed the trial court’s damage award and remanded with instructions to award the plaintiffs such damages as will restore them to the position they enjoyed right before they inked their contract with the contractor.