Consequential damages are those that are not a direct result of an act, but a consequence of the initial act. To be awarded consequential damages in a lawsuit, they must be a foreseeable result of an act. In a contractual situation, consequential damages resulting from the seller’s breach include any loss resulting from general or particular requirements and needs of which the seller at the time of contracting had reason to know and which could not reasonably be prevented by cover (obtaining a substitute) or otherwise. Many warranties seek to exclude or limit consequential damages, such as exclusion for loss of time, inconvenience, loss of use of the vehicle or commercial loss in car warranties.
The following is an example of a state statute dealing with consequential damages in a lease situation: