MBE Rules · Remedies
Compensatory Damages
Cal. Civ. Code §§ 3300-3302 (contract); § 3333 (tort)
The rule
Compensatory damages restore the injured party to the position she would have occupied absent the wrong. In contract, damages are measured by the loss of the bargain (expectation); in tort, by the actual harm suffered. Damages must be proximate, foreseeable, and reasonably certain in amount.
In plain English
Compensatory damages are intended to make the injured party whole again by covering the losses they incurred due to a wrongful act. In contract cases, these damages focus on the expected benefits that were lost, while in tort cases, they are based on the actual harm experienced by the victim.
Worked example
Alice and Bob entered into a contract for the sale of a car for $10,000. Bob failed to deliver the car, and Alice had to buy a similar car for $12,000. In this case, Alice can recover $2,000 in compensatory damages to cover her loss of the bargain.
Memory hook
Compensatory damages: restoring you to where you should've been.
The trap
Exams may present scenarios where students confuse compensatory damages with punitive damages, leading them to miscalculate the appropriate recovery. Additionally, students might overlook the requirement for damages to be foreseeable and reasonably certain.
How examiners test it
Questions often involve fact patterns where a party suffers a loss due to a breach of contract or a tortious act, requiring candidates to identify the appropriate measure of compensatory damages based on the specifics of the case.
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