Nonetheless, in specific circumstances, a party may successfully recover more money than initially contracted for under the doctrine of reliance damages. This hesitancy to award punitive damages is due to the theory of efficient breach which argues that breaching contracts and paying damages is sometimes economically beneficial for society as a whole. For example, if a party agrees to pay $50,000 to have their house painted but is only willing to hand over $10,000 once the painting is complete, the court will award the painters $40,000 in damages. Generally, these damages are limited to what is listed in the contract and, unlike damages from tort cases, courts do not award punitive damages for breaches of contract.
As a result, the default remedy available for a breach of contract is monetary damages. The overarching goal of contract law is to place the harmed party in the same economic position they would have been in had no breach of contract occurred. Due to the frequency of breaches of contract, a robust body of law has grown to resolve the ensuing disputes. A breach of contract occurs whenever a party who entered a contract fails to perform their promised obligations.
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