Glossary → Contracts
Contracts

Consequential Damages

Indirect losses that flow from a breach — like lost profits.

Consequential (or indirect) damages are losses that don’t come directly from a breach but result from it — lost profits, lost business, reputational harm. Many contracts exclude them entirely, which can leave you unable to recover your real losses. Check whether the exclusion is mutual.

In practice

“Neither party shall be liable for any consequential, incidental, or special damages.” — caps what you can recover even if the breach cost you customers.

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