Legal Definitions - consequential damages

Consequential damages

Consequential damages, also known as special damages, are a type of compensation that a plaintiff can seek from a defendant for harm caused as a result of the defendant's actions. These damages may not necessarily be a direct result of the defendant's wrongful action, but rather a natural consequence of the act.

• A construction company fails to complete a project on time, causing the owner of the building to lose out on potential rental income. The owner can seek consequential damages for the lost income.
• A car manufacturer produces a faulty vehicle that causes an accident, resulting in the driver's medical bills and lost wages. The driver can seek consequential damages for the financial losses incurred as a result of the accident.

These examples illustrate how consequential damages are a form of compensation for losses that are a direct result of the defendant's actions, but not necessarily a direct result of the wrongful act itself.