Speculative Damages Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Speculative Damages, written in plain English, along with examples of how it is used.
What is Speculative Damages?
(n) Speculative damages are the claims made by plaintiff for compensating the contingent loss which may occur in future as a consequences of the wrong doing by the defended. For example when a property is not transferred as per the contract, the calculation of future appreciation in its values and loss with respect to that appreciated value is a claim of speculative damages
History and Meaning of Speculative Damages
Speculative damages refer to the compensation claimed by a plaintiff for future losses that may result from the defendant's wrongdoing. These damages are difficult to calculate as they are based on uncertain or speculative events or estimates. Courts generally avoid awarding speculative damages because they are seen as too uncertain or speculative. However, in some instances, they may be available to compensate the plaintiff for future losses.
The concept of speculative damages has been part of the law for centuries. In the past, damages were typically awarded only for actual losses suffered by the plaintiff. However, as the economy became more complex, courts began to recognize the need to compensate plaintiffs for future losses that are likely to occur.
Examples of Speculative Damages
A physician is accused of medical malpractice that resulted in a patient's paralysis. The patient may be awarded speculative damages for the future medical expenses, lost income, and other losses that may result from living with paralysis.
A company breaches the terms of a contract, thereby causing the plaintiff to incur significant losses. In this case, the plaintiff may seek speculative damages that cover the estimated future losses.
A party to a construction contract breaches the contract, causing delays in the project completion. The plaintiff may seek speculative damages for the future costs and losses that may result from the delay.
Legal Terms Similar to Speculative Damages
Consequential Damages: Consequential damages refer to the indirect or secondary losses resulting from the defendant's wrongdoing.
Liquidated Damages: Liquidated damages are pre-estimated damages that are included in a contract to provide a predetermined amount of damages to the plaintiff in case of a breach by the defendant.
General Damages: General damages refer to the direct or primary losses that the plaintiff has suffered due to the defendant's wrongdoing. These may include physical or emotional injuries, loss of income, and other losses.