Reliance Damages
Reliance damages are a type of monetary compensation awarded in legal cases when one party relies on a promise or contract that the other party fails to fulfill. These damages aim to reimburse the injured party for expenses or losses incurred while preparing to fulfill the agreement. Unlike expectation damages, which focus on what the injured party hoped to gain from the contract, reliance damages focus on restoring them to the financial position they were in before they relied on the promise. Essentially, they help cover costs incurred based on the belief that the contract would be honored.
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Reliance damages are a form of compensation awarded in contract law when a party has relied on a promise made by another party, only to have that promise broken. These damages are intended to cover the expenses incurred and losses suffered due to that reliance, putting the claimant in the position they would have been in had the contract never been made. Essentially, reliance damages aim to reimburse the injured party for their reasonable investments and efforts based on the expectation that the contract would be fulfilled, rather than compensating for potential profits they might have made.