Compensatory damages refer to monetary payments a party who breached a contract is ordered to pay in order to compensate the injured party for the actual losses that result from the breach.

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Compensatory damages are a type of financial compensation awarded to the party who suffered a loss due to a breach of contract. The damages are intended to put the injured party in the position they would have been in if the breach had not occurred, by covering the actual losses suffered as a result of the breach.

Compensatory Damages Refer to Monetary Payments a Party Who Breached