What can the innocent party recover as a result of a breach?

The innocent party in a breach of contract situation is entitled to recover expenses and reasonably anticipated profit losses because these represent the losses that directly result from the breach. When a contract is breached, the primary purpose of damages is to place the innocent party in the position they would have been in had the contract been fulfilled. This encompasses not just the contract price but also additional costs incurred as a direct result of the breach and the profits that the innocent party reasonably expected to make from the contract.

To successfully claim these damages, the party must demonstrate that the losses were foreseeable and that they made reasonable efforts to mitigate those losses. This means that not only actual expenses can be claimed but also profits that were anticipated at the time the contract was made.

In contrast, recovering only the contract price does not provide adequate compensation for the losses incurred. Similarly, future income projections can often be speculative and uncertain, making it difficult to prove their reliability. Claiming only actual damages incurred may not encapsulate the full extent of losses, particularly those linked to lost profits anticipated from the contract. Therefore, the option that includes expenses and reasonably anticipated profit losses aligns with the principles of contractual damages and the goal of making the innocent party whole.