What type of damages are awarded to compensate for actual loss suffered?

Compensatory damages are awarded specifically to compensate a party for the actual loss they have suffered as a result of another party's breach of duty or wrongful act. These damages aim to make the injured party whole again, reflecting the real economic loss incurred due to the wrongful act. This can include actual expenses, lost earnings, and other quantifiable financial losses directly linked to the incident.

By contrast, consequential damages refer to losses that are not directly tied to the injury but occur as a secondary result of the breach or act. Punitive damages are intended to punish the wrongdoer for particularly egregious behavior and deter similar conduct in the future, rather than to compensate the victim for their loss. Equitable remedies, such as injunctions or specific performance, involve court orders requiring a party to act or refrain from acting in a certain way and do not provide monetary compensation. Therefore, compensatory damages directly serve the purpose of addressing and remedying actual losses suffered by the injured party.