Intort law, actual damages, also known as compensatory damages, are damages awarded by a court equivalent to the loss a party suffered. If a party’s right was technically violated but they suffered no harm or losses, a court may instead grant nominal damages.
TheSupreme Courtheld inBirdsall v. Coolidge, 93 U.S. 64 (1876)that the phrases "compensatory damages" and "actual damages" are identical.
The amount awarded is based on the proven harm, loss, or injury suffered by theplaintiff. This award does not includepunitive damages, which may be awarded when the defendant's actions are especiallyrecklessor malicious. Receiving actual damages does not prevent a party from also receiving punitive damages.
When calculating actual damages, courts will often look at the fair market value of destroyed/damaged property, lost wages/income, and necessarily incurred expenses. Courts may also include damages foremotional distress; however, due to the difficulty of placing an economic value on these intangible factors, the application is inconsistent.
[Last updated in June of 2022 by the Wex Definitions Team]
