GA Code § 13-6-8 (2021)
2021 Georgia Code|Title 13 - Contracts|Chapter 6 - Damages and Costs Generally|§ 13-6-8. Damages and Expenses Recoverable - Remote or Consequential Damages

 Remote or consequential damages are not recoverable unless they can be traced solely to the breach of the contract or unless they are capable of exact computation, such as the profits which are the immediate fruit of the contract, and are independent of any collateral enterprise entered into in contemplation of the contract.   (Orig. Code 1863, § 2885; Code 1868, § 2893; Code 1873, § 2944; Code 1882, § 2944; Civil Code 1895, § 3798; Civil Code 1910, § 4394; Code 1933, § 20-1406.)   Law reviews.   - For article discussing recovery of anticipatory damages in breach of contract actions, see 11 Ga. B.J. 18 (1948). For article, "The New Documentary Concerns Associated With Intelligent Buildings," see 22 Ga. St. B.J. 16 (1985). For comment, "Recovering Lost Profits for an Unestablished Business Under Georgia Law: The New Business Rule Bows to MECCA," see 39 Mercer L. Rev. 977 (1988).   JUDICIAL DECISIONS   Tortious acts not necessary for recovery.    - Even though the statutory definitions of general and special damages (see O.C.G.A. § 51-12-2) refer to tortious acts, general and special damages also may be recovered in contract actions if the damages are not remote or consequential and arose naturally and according to the usual course of things from the breach. Bill Parker & Assocs. v. Rahr, 216 Ga. App. 838, 456 S.E.2d 221 (1995).   Fact that damages are to some extent contingent does not necessarily prevent their recovery.    - Damages which are the legal and natural result of breach are not necessarily too remote merely because the damages may be to some extent contingent. Walker v. Jenkins, 32 Ga. App. 238, 123 S.E. 161 (1924); Reynolds v. Speer, 38 Ga. App. 570, 144 S.E. 358 (1928).    To recover substantial, compensatory damages, there must be some evidence of actual damages, and amount of those damages. Lurlee, Inc. v. Pernoshal-39 Co., 135 Ga. App. 724, 218 S.E.2d 701 (1975).    Burden is on plaintiff to show both breach and damage, and this must be done by evidence which will furnish the jury data sufficient to enable the jury to estimate with reasonable certainty the amount of damages; it cannot be left to speculation, conjecture, and guesswork. Bennett v. Associated Food Stores, Inc., 118 Ga. App. 711, 165 S.E.2d 581 (1968).    As a general rule, expected profits of commercial business are too uncertain, speculative, and remote to permit recovery for their loss. Atlanta Gas Light Co. v. Newman, 88 Ga. App. 252, 76 S.E.2d 536 (1953).    Speculative damages - the loss of conjectural profits - are too remote and uncertain to be recoverable. Davis v. Boyd, 118 Ga. App. 198, 162 S.E.2d 880 (1968).    Loss of anticipated profits from contract which are completely conjectural are not recoverable. Hip Pocket, Inc. v. Levi Strauss & Co., 144 Ga. App. 792, 242 S.E.2d 305 (1978).   When anticipated profits are recoverable.    - While anticipated profits of an unestablished future business are generally too speculative for recovery, where the business has been long established, has uniformly made profits, and there are definite, certain, and reasonable data for their ascertainment, and such profits reasonably must have been in contemplation of parties at time of contract, the damages may be recovered at least for a limited reasonable future time, even though the damages cannot be computed with exact mathematical certainty. B.H. Levy Bro. & Co. v. Allen, 53 Ga. App. 246, 185 S.E. 369 (1936).    Party who has been injured by a breach of contract can recover profits that would have resulted from performance when the amount of the loss and the fact that the loss could have been prevented by the breach can be proved with reasonable certainty. Graham Bros. Constr. Co. v. C.W. Matthews Contracting Co., 159 Ga. App. 546, 284 S.E.2d 282 (1981).   Lost profits not recoverable unless capable of definite ascertainment and traceable directly to other party's acts.    - In general, unless lost profits are capable of definite ascertainment, and are traceable directly to acts of other party, lost profits are not recoverable in action for breach of contract. Kingston Pencil Corp. v. Jordan, 115 Ga. App. 333, 154 S.E.2d 650 (1967).   Claim for lost profits precluded.    - In suit by van manufacturer against dealership for breach of contract, van manufacturer's lost profits were clearly precluded by O.C.G.A. § 13-6-8; the lost profits sought by van manufacturer were not independent of any collateral enterprise entered into in contemplation of the claimed contract and, in fact, the lost profits were very dependent upon the market for the vans - a market which the testimony indicated was suffering from a recession. Hixson-Hopkins Autoplex, Inc., 208 Ga. App. 820, 432 S.E.2d 224 (1993).    Contractual provision prohibiting the recovery of special damages precluded an award for contractual profits actually lost as a result of the breach of the contract. Imaging Sys. Int'l v. Magnetic Resonance Plus, Inc., 227 Ga. App. 641, 490 S.E.2d 124 (1997).    When a contract specifically prohibited recovery of "any lost profits" by either party, both consequential and direct damages, to the extent those damages concerned lost profits, were not recoverable. Imaging Sys. Int'l v. Magnetic Resonance Plus, Inc., 227 Ga. App. 641, 490 S.E.2d 124 (1997).   Lost profits not shown.    - A contractor was not entitled to recover lost profits pursuant to O.C.G.A. § 13-6-8 in its claim for breach of contract against a defaulting supplier, because the contractor failed to demonstrate a history of profitability and failed to provide definite, certain, and reasonable data to ascertain the amount of lost profits on the job at issue. Triad Drywall, LLC v. Bldg. Materials Wholesale, Inc., 300 Ga. App. 745, 686 S.E.2d 364 (2009).    Lost profits recoverable when hotelkeeper injured due to lessor's failure to repair. Stewart v. Lanier House Co., 75 Ga. 582 (1885).   Breach of contract and lost income.    - When a defendant's breach of contract causes a hotel to lose business, compensation for lost income is recoverable and the hotel operator need only show generally the facts which will enable the jury to approximate the operator's losses and ascertain the operator's damages. McDevitt & Street Co. v. K-C Air Conditioning Serv., Inc., 203 Ga. App. 640, 418 S.E.2d 87, cert. denied, 203 Ga. App. 906, 418 S.E.2d 87 (1992).    When a defendant's breach of contract caused a dump truck owner to lose income and its senior status with an account, compensation for lost income was recoverable since the dump truck owner's lost profits claim was supported by tax and income records. Freightliner Chattanooga, LLC v. Whitmire, 262 Ga. App. 157, 584 S.E.2d 724 (2003).    When items cannot be traced solely to defendant's breach of the contract, the trial court errs by awarding these sums as consequential damages. DOT v. Arapaho Constr., Inc., 180 Ga. App. 341, 349 S.E.2d 196 (1986), aff'd, 257 Ga. 269, 357 S.E.2d 593 (1987).   Lost profits not too remote when telegraph operation knowingly sends erroneous messages intended to deceive.    - When telegraph operator knowingly sends false, fraudulent, and fictitious messages, which are intended to and do deceive addressee, liability for lost profits is not too remote. Jenkins v. Cobb, 47 Ga. App. 456, 170 S.E. 698 (1933).    Current profits of going manufacturing concern are too uncertain to form basis of award of damages for breach of contract affecting operation of the plant. Consolidated Phosphate Co. v. B.F. Sturtevant Co., 20 Ga. App. 474, 93 S.E. 155 (1917).   Breach of real estate sales contract.    - In an action by a seller against a buyer for breach of a real estate sales contract, there can be no recovery for continued insurance coverage, utility bills, maintenance costs, ad valorem taxes, and loss of use of proceeds of sale, in the absence of a clause in the parties' contract expressly authorizing such recovery. Quigley v. Jones, 255 Ga. 33, 334 S.E.2d 664 (1985).   Damages for breach of share-cropping contract by landlord.    - See Wideman v. Selph, 71 Ga. App. 343, 30 S.E.2d 797 (1944).    Measure of damages for breach of construction contract by owner is usually profits, that is, price less what it would have cost contractor to perform. Crosswell v. Arten Constr. Co., 152 Ga. App. 162, 262 S.E.2d 522 (1979).   Damages resulting from nature of traveler's business, unknown to railroad contracting with traveler, are too remote.    - Damages resulting from the particular character of business of traveler, unknown to railroad company contracting with the traveler, are too remote to be recovered. Georgia R.R. v. Hayden, 71 Ga. 518, 51 Am. R. 274 (1833).    Law inapplicable in action for breach of promise of marriage. Parker v. Forehand, 99 Ga. 743, 28 S.E. 400 (1896).   Validity of clause excluding consequential damages.    - To the extent that consequential damages are recoverable in breach of contract actions, a clause excluding such damages is valid and binding unless prohibited by statute or public policy. Mark Singleton Buick, Inc. v. Taylor, 194 Ga. App. 630, 391 S.E.2d 435 (1990).   Entitlement to due process.    - Plaintiff could not provide an exact computation of the plaintiff's consequential damages, O.C.G.A. § 13-6-8, and had not provided specific consequential damages in any pleading or brief showing a loss that could be traced solely to defendants' failure to provide the defendant with the defendant's contractual guarantee of procedural due process. Therefore, because defendants' alleged breach of plaintiff's employment contract did not result in any cognizable loss relating to the plaintiff's status as a tenured faculty member, there was no genuine issue of material fact concerning whether plaintiff was still entitled to the due process protections afforded by the plaintiff's employment contract. Soloski v. Adams, 600 F. Supp. 2d 1276 (N.D. Ga. 2009).   Attorney fees in condemnation case.    - Trial court did not err as a matter of law by including in the court's award to plaintiff the attorney fees plaintiff incurred in litigating a condemnation case unsuccessfully brought by defendant since these fees were consequential damages incurred as a direct result of defendant's failure to provide the rights-of-way as required by the contract between the parties. DOT v. Arapaho Constr., Inc., 180 Ga. App. 341, 349 S.E.2d 196 (1986), aff'd, 257 Ga. 269, 357 S.E.2d 593 (1987).    Cited in John M. Clark & Co. v. Neufvill, 46 Ga. 261 (1872); Butler v. Moore, 68 Ga. 780, 45 Am. R. 508 (1882); Willingham v. Hooven, Owens, Rentschler & Co., 74 Ga. 233, 58 Am. R. 435 (1884); Gore v. Malsby & Co., 110 Ga. 893, 36 S.E. 315 (1900); Seaboard Air-Line Ry. v. Harris, 121 Ga. 707, 49 S.E. 703 (1905); Carolina Portland Cement Co. v. Columbia Imp. Co., 3 Ga. App. 483, 60 S.E. 279 (1908); Tygart v. Albritton, 5 Ga. App. 412, 63 S.E. 521 (1909); Hall v. J.I. Case Threshing Mach. Co., 11 Ga. App. 840, 76 S.E. 597 (1912); American Agrl. Chem. Co. v. Rhodes, 139 Ga. 495, 77 S.E. 582 (1913); Montgomery v. Alexander Lumber Co., 140 Ga. 51, 78 S.E. 413 (1913); Southwestern R.R. v. Vellines, 14 Ga. App. 674, 82 S.E. 166 (1914); Whitlock v. Mozley & Co., 142 Ga. 305, 82 S.E. 886 (1914); Upmago Lumber Co. v. Monroe & Co., 148 Ga. 847, 98 S.E. 498 (1919); Prince v. Evans, 23 Ga. App. 660, 99 S.E. 132 (1919); Pannell v. Stark, 27 Ga. App. 104, 107 S.E. 496 (1921); La Grange Grocery Co. v. Young & Griffin Coffee Co., 30 Ga. App. 303, 117 S.E. 673 (1923); Horne & Ponder v. Evans, 31 Ga. App. 370, 120 S.E. 787 (1923); Firestone Tire & Rubber Co. v. Shore, 31 Ga. App. 644, 121 S.E. 709 (1924); Anderson, Clayton & Co. v. Mangham, 32 Ga. App. 152, 123 S.E. 159 (1924); Norman & Griffin v. Shealey, 33 Ga. App. 534, 126 S.E. 887 (1925); Courier-Herald Publishing Co. v. American Type Founders Co., 34 Ga. App. 473, 130 S.E. 80 (1925); Bank of Bullochville v. Riehle, 36 Ga. App. 470, 137 S.E. 642 (1927); Gary v. Central of Ga. Ry., 37 Ga. App. 744, 141 S.E. 819 (1928); Buffington v. Atlanta Title & Trust Co., 43 Ga. App. 444, 159 S.E. 297 (1931); Bankers' Health & Life Ins. Co. v. James, 177 Ga. 520, 170 S.E. 357 (1933); Toccoa Falls Light & Power Co. v. Georgia Power Co., 53 Ga. App. 522, 186 S.E. 436 (1936); Sanford v. Patent Scaffolding Co., 199 Ga. 41, 33 S.E.2d 422 (1945); Weathers Bros. Transf. Co. v. Jarrell, 72 Ga. App. 317, 33 S.E.2d 805 (1945); Speed Oil Co. v. Griffin, 73 Ga. App. 242, 36 S.E.2d 205 (1945); Bigelow-Sanford Carpet Co. v. Goodroe, 98 Ga. App. 394, 106 S.E.2d 45 (1958); Camilla Cotton Oil Co. v. Spencer Kellogg & Sons, 257 F.2d 162 (5th Cir. 1958); Smith v. A.A. Wood & Son Co., 103 Ga. App. 802, 120 S.E.2d 800 (1961); Atlanta Tallow Co. v. John W. Eshelman & Sons, 110 Ga. App. 737, 140 S.E.2d 118 (1964); State Hwy. Dep't v. Knox-Rivers Constr. Co., 117 Ga. App. 453, 160 S.E.2d 641 (1968); Eastern Fed. Corp. v. Avco-Embassy Pictures, Inc., 326 F. Supp. 1280 (N.D. Ga. 1970); Crawford & Assocs. v. Groves-Keen, Inc., 127 Ga. App. 646, 194 S.E.2d 499 (1972); Radlo of Ga., Inc. v. Little, 129 Ga. App. 530, 199 S.E.2d 835 (1973); Brown v. Hilton Hotels Corp., 133 Ga. App. 286, 211 S.E.2d 125 (1974); Comtrol, Inc. v. H-K Corp., 134 Ga. App. 349, 214 S.E.2d 588 (1975); Trawick v. Trax, Inc., 136 Ga. App. 62, 220 S.E.2d 70 (1975); Consolidated Eng'g Co. v. U.I.R. Contractors, 136 Ga. App. 923, 222 S.E.2d 692 (1975); Lindgren v. Dowis, 236 Ga. 278, 223 S.E.2d 682 (1976); Cagle v. Southern Bell Tel. & Tel. Co., 143 Ga. App. 603, 239 S.E.2d 182 (1977); LDH Properties, Inc. v. Morgan Guar. Trust Co., 145 Ga. App. 132, 243 S.E.2d 278 (1978); Corrosion Control, Inc. v. William Armstrong Smith Co., 157 Ga. App. 291, 277 S.E.2d 287 (1981); Leader Nat'l Ins. Co. v. Smith, 177 Ga. App. 267, 339 S.E.2d 321 (1985); All-Georgia Dev., Inc. v. Kadis, 178 Ga. App. 37, 341 S.E.2d 885 (1986); Complete Concepts, Ltd. v. General Handbag Corp., 880 F.2d 382 (11th Cir. 1989).   RESEARCH REFERENCES   C.J.S.   - 25 C.J.S., Damages, §§ 4, 5, 8, 34 et seq., 108 et seq.   ALR.    - Loss of anticipated profits as damages for breach of seller's contract as to machine for buyer's use, 32 A.L.R. 120.    Rights and remedies upon cancelation of sales agency, 32 A.L.R. 209; 52 A.L.R. 546; 89 A.L.R. 252.    Rate of exchange to be taken into account in assessing damages for breach of contract, 43 A.L.R. 520; 50 A.L.R. 1273; 105 A.L.R. 640.    Injury to prestige or reputation as element of damages for employer's breach of contract for services, 56 A.L.R. 901.    Expenses incurred in seeking or in obtaining other employment as element of damages in an action for wrongful discharge of employee, 84 A.L.R. 171.    Measure of damages recoverable for loss of or failure to obtain employment for indefinite term, as result of telegraph company's breach of duty as to transmission or delivery of message, 103 A.L.R. 546.    Damages for breach by seller or former employee of covenant, express or implied, not to engage in like business or enter employment of competitor of covenantee, 127 A.L.R. 1152.   Right to recover, in action for breach of contract, expenditures incurred in preparation for performance, 17 A.L.R.2d 1300.   Measure of damages for lessor's breach of contract to lease or to put lessee in possession, 88 A.L.R.2d 1024.   Mental anguish as element of damages in action for breach of contract to furnish goods, 88 A.L.R.2d 1367.   Measure and elements of sublessee's damages recoverable from sublessor for latter's failure to exercise option to renew his lease, 94 A.L.R.2d 1345.   Damages to franchisee for failure of franchisor of national brand or service to provide the services or facilities contracted for, 41 A.L.R.3d 1436.   Civil liability of undertaker in connection with embalming or preparation of body for burial, 48 A.L.R.3d 261.   Recovery for mental anguish or emotional distress, absent independent physical injury, consequent upon breach of contract in connection with sale of real property, 61 A.L.R.3d 922.   Recovery of expected profits lost by lessor's breach of lease preventing or delaying operation of new business, 92 A.L.R.3d 1286.   Buyer's incidental and consequential damages from seller's breach under UCC § 2-715, 96 A.L.R.3d 299.   Recovery by writer, artist, or entertainer for loss of publicity or reputation resulting from breach of contract, 96 A.L.R.3d 437.   Recovery for mental anguish or emotional distress, absent independent physical injury, consequent upon breach of contract or warranty in connection with construction of home or other building, 7 A.L.R.4th 1178.   Special or consequential damages recoverable, on account of delay in delivering possession, by purchaser of real property awarded specific performance, 11 A.L.R.4th 891.   Recovery of anticipated lost profits of new business: post-1965 cases, 55 A.L.R.4th 507.