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WPI 303.01 Measure of Expectation Damages—Breach of Contract—No Counterclaim

6A WAPRAC WPI 303.01Washington Practice Series TMWashington Pattern Jury Instructions--Civil

6A Wash. Prac., Wash. Pattern Jury Instr. Civ. WPI 303.01 (7th ed.)
Washington Practice Series TM
Washington Pattern Jury Instructions--Civil
April 2022 Update
Washington State Supreme Court Committee on Jury Instructions
Part XIII. Contracts
Chapter 303. Contracts—Remedies
WPI 303.01 Measure of Expectation Damages—Breach of Contract—No Counterclaim
It is the duty of the court to instruct you as to the measure of damages. [By instructing you on damages the court does not mean to suggest for which party your verdict should be rendered.]
In order to recover actual damages, the plaintiff has the burden of proving that the defendant breached a contract with plaintiff, and that plaintiff incurred actual [economic] damages as a result of the defendant's breach, and the amount of those damages.
[If your verdict is for plaintiff on plaintiff's breach of contract claim and] if you find that plaintiff has proved that plaintiff incurred actual damages and the amount of those actual damages, then you shall award actual damages to the plaintiff.
Actual damages are those losses that were reasonably foreseeable, at the time the contract was made, as a probable result of a breach. A loss may be foreseeable as a probable result of a breach because it follows from the breach either
(1) in the ordinary course of events, or
(2) as a result of special circumstances, beyond the ordinary course of events, that the party in breach had reason to know.
In calculating the plaintiff's actual damages, you should determine the sum of money that will put the plaintiff in as good a position as plaintiff would have been in if both plaintiff and defendant had performed all of their promises under the contract.
The burden of proving damages rests with the plaintiff and it is for you to determine, based upon the evidence, whether any particular element has been proved by a preponderance of the evidence. You must be governed by your own judgment, by the evidence in the case, and by these instructions, rather than by speculation, guess, or conjecture.
Use this instruction in a breach of contract action without a counterclaim. When a counterclaim is presented, use WPI 303.02 (Measure of Damages—Breach of Contract—Counterclaim) instead.
Use this instruction when expectation damages are sought, rather than reliance damages. For reliance damages, use WPI 303.05 (Contract—Reliance Damages).
Use this instruction with an explanation of direct damages, as set forth in WPI 303.03 (Contract—Measure of Damages—Direct Damages—Special Cases), as is appropriate to the facts of the case. When there is an evidentiary basis for an award of lost profits, use WPI 303.04 (Contract—Damages—Lost Profits).
Use the limiting adjective “economic” before “damages” in the second paragraph, unless the case falls within the exceptions noted in the Comment under the heading “Mental Distress.”
If a valid liquidated damage clause applies, use WPI 303.07 (Contract—Liquidated Damages) instead of this instruction.
Recoverable damages. The seminal case on contract damages is Hadley v. Baxendale, 9 Ex. 341, 354, 156 Eng. Rep. 145, 151 (1854), in which the court described damages recoverable for a breach of contract as those that:
may fairly be considered either arising naturally, i.e., according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of the parties, at the time they made the contract, as the probable result of the breach of it.
See Gaglidari v. Denny's Rests., Inc., 117 Wn.2d 426, 445–46, 815 P.2d 1362 (1991).
Damages in contract actions differ significantly from damages in tort actions. Alejandre v. Bull, 159 Wn.2d 674, 682, 153 P.3d 864 (2007). Purely economic damages are specifically recoverable in contract actions, as opposed to tort actions. Berschauer/Phillips Constr. Co. v. Seattle Sch. Dist. No. 1, 124 Wn.2d 816, 828, 881 P.2d 986 (1994). The purpose of damages in a breach of contract action is “not a mere restoration to a former position, as in tort, but the awarding of a sum which is the equivalent of performance of the bargain—the attempt to place the plaintiff in the position he would be in if the contract had been fulfilled ….” Rathke v. Roberts, 33 Wn.2d 858, 865, 207 P.2d 716 (1949); accord TMT Bear Creek Shopping Center, Inc., v. Petco Animal Supplies, Inc., 140 Wn.App. 191, 210, 165 P.3d 1271 (2007); Jacob's Meadow Owners Ass'n v. Plateau 44 II, LLC, 139 Wn.App. 743, 757 n.3, 162 P.3d 1153 (2007).
On the other hand, damages in contract actions are generally narrower than damages in tort actions in that they are limited to compensation for economic harm or pecuniary loss; see the discussion of mental distress below.
According to the Restatement (Second) of Contracts § 351 (1981):
  • (1) Damages are not recoverable for loss that the party in breach did not have reason to foresee as a probable result of the breach when the contract was made.
  • (2) Loss may be foreseeable as a probable result of a breach because it follows from the breach
    • (a) in the ordinary course of events, or
    • (b) as a result of special circumstances, beyond the ordinary course of events, that the party in breach had reason to know.
  • (3) A court may limit damages for foreseeable loss by excluding recovery for loss of profits, by allowing recovery only for loss incurred in reliance, or otherwise if it concludes that in the circumstances justice so requires in order to avoid disproportionate compensation.
“The amount of damages should reflect what is required to place the [injured party] in the same financial position he would have enjoyed in the absence of the breach.” Family Med. Bldg., Inc., v. Dep't of Soc. & Health Servs., 104 Wn.2d 105, 114, 702 P.2d 459 (1985); accord Restatement (Second) of Contracts § 347 (1981). Regarding lost profits, however, see WPI 303.04 (Contract—Damages—Lost Profits) and its Comment.
Reliance damages. As an alternative to the general benefit-of-the-bargain measure of damages for a breach of contract action, an injured party may recover damages based on reliance interest, when that party cannot prove with reasonable certainty what profit would have been made had the contract been performed. Such damages may include expenditures made in preparation for performance, or in performance, minus any loss that the party in breach can prove with reasonable certainty the injured party would have suffered if the contract had been performed. Family Med., 104 Wn.2d at 114. See WPI 303.05 (Contract—Reliance Damages) and its Comment. When such damages are sought, the instruction's next-to-last paragraph should be eliminated.
Mental distress. With certain limited exceptions, no damages are awarded for mental or emotional distress resulting from a breach of contract. Restatement (Second) of Contracts § 353 (1981); DeWolf, Allen, & Caruso, 25 Washington Practice, Contract Law and Practice § 14:1 (3d ed.). Specifically, damages for mental suffering are not recoverable in a contract action except for certain categories of contracts for which a breach is particularly likely to lead to emotional distress. See Gaglidari, 117 Wn.2d at 443–44 (recoverable for contracts of carriers and innkeepers with passengers and guests; recoverable for contracts for the disposition of bodies or delivery of messages concerning death; not recoverable for contracts of employment). Cf. Wright v. Beardsley, 46 Wash. 16, 89 P. 172 (1907) (recoverable under contract theory for improper burial of child).
Nominal damages. The WPI Committee considered including the following provision in this instruction, but in view of the Washington cases on this subject, determined that it is not appropriate for inclusion in a breach of contract action for damages only:
[If your verdict is for the plaintiff on plaintiff's claim of breach of contract, then] you will award the plaintiff actual damages or the court will award a small amount of nominal damages.
While the traditional rule is that an action will lie for breach of contract without proof of injury, resulting in nominal damages, see DeWolf, Allen, & Caruso, 25 Washington Practice, Contract Law and Practice § 14:3 (3d ed.), there is a line of cases in which Washington courts have held to the contrary, when the suit is for damages only. Ketchum v. Albertson Bulb Gardens, 142 Wash. 134, 139, 252 P. 523 (1927); Sorrel v. Eagle Healthcare, Inc., 110 Wn.App. 290, 296, 38 P.3d 1024 (2002) (“Dismissal of an action for damages where no property rights are involved need not be reversed if damages are nominal. This is because the law does not deal with trifles.”); Wilkerson v. Wegner, 58 Wn.App. 404, 793 P.2d 983 (1990) (summary judgment for defendant when proof of any damage entirely speculative in lost opportunity to compete for prize money).
On the other hand, there are Washington cases reciting that nominal damages are appropriate in some cases where there is no proof of substantial damage, see, e.g., Ford v. Trendwest Resorts, Inc., 146 Wn.2d 146, 158, 43 P.3d 1223 (2002) (remanding case for entry of nominal damages on breach of employment contract claim on theory that nominal damages are available in all contract actions “where, from the nature of the case, some injury has been done, the amount of which the proofs entirely fail to show”); Seymour v. Jaffe, 78 Wash. 1, 138 P. 276 (1914) (non-negligent seller, unable to convey real property for failure of title). There are also, however, many cases in which the courts, through various procedural devices, render nominal damage awards in contract actions essentially meaningless. E.g., Lee v. Bergesen, 58 Wn.2d 462, 364 P.2d 18 (1961); Com. Inv. Co. v. Nat'l Bank of Com., 36 Wash. 287, 78 P. 910 (1904); Johnson v. Cook, 24 Wash. 474, 64 P. 729 (1901).
For a detailed discussion of damages issues, see DeWolf, Allen, & Caruso, 25 Washington Practice, Contract Law and Practice ch. 14 (3d ed.).
[Current as of April 2021.]
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