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GLOSSARY

Exemplary damages definition

What does Exemplary damages mean?

damages assessed to punish the defendant for the manner in which he committed the wrong against the claimant.

They, exceptionally, are punitive rather than compensatory in nature.

Commercial

Damages awarded not for the purposes of compensating for loss but for reasons of public policy.
English law does not, other than in highly exceptional circumstances, recognise an entitlement to recover punitive (exemplary) damages for a breach of contract. The purpose of awarding damages is to compensate the innocent party not to punish the party in breach. An exception may arise where the defendant has deliberately broken the contract with the aim of obtaining benefit but in a way that does not cause measurable loss to the claimant.

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Discover our 4 Practice Notes on Exemplary damages