Measure of Damages Law and Legal Definition

Measure of damages is a way to compute damages that are to be awarded to an injured person. In an action on a penal bond, the measure of damages is compensation for the actual loss, not exceeding the established penalty. In a contract, measure of damages is intended to place the injured party in the same situation as if the contract was performed. Non-compliance of the terms of a contract and actual loss are the key factors for the measure of damages. In an action of tort, measure of damages is the formula that determines a fair compensation for a plaintiff's injuries sustained along with the compensation for any pain and suffering that the plaintiff had gone through.