https://legaldictionary.

net/incidental-damages/

Incidental Damages
Incidental damages are reasonable expenses incurred by one party to a contract as a
result of the other party’s breach of the contract. These expenses may be awarded in a
civil lawsuit in addition to the award of compensatory damages. To explore this
concept, consider the following incidental damages definition.
Definition of Incidental
Noun
1. Something that happens by chance or without intention
Adjective
2. Occurring as an unpredictable consequence
Origin
1655-1665   Middle English
Costs Considered Incidental Damages
Incidental costs are costs that were not expected in the normal execution of the contract,
but arose due to the breach of the contract. Such costs may include:
 Inspection of items
 Transportation or care of items
 Expenses or commissions incurred in connection with incident or delay of items
 Storing of defective items until the supplier can retrieve them

Incidental vs. Consequential Damages

The difference between incidental and consequential damages is the cause of the
expense or loss. Incidental damages are the direct result of one party’s breach of
contract. Consequential damages are more indirect, being incurred not as a result of the
breach itself, but due to the end result of the breach.
Example of Incidental Damages
Bright Lite Bulb Store contracts to install 100 light fixtures in a local mall within 7
days, and so enters into a purchase agreement with a supplier to buy the fixtures. The
supplier agrees to deliver the fixtures within three days. On the fifth day, the supplier
notifies Bright Lite they cannot fill the order, breaching the contract. Because the mall is
unable to change their timeline, Bright Lite loses the contract and has to refund the
mall’s money. The losses incurred by Bright Lite are a direct result of the supplier’s
breach of contract, and so are considered incidental damages.
Example of Consequential Damages
The mall in the above example fails to make their deadline to open a new store space
because installation of the lights is delayed, and loses two days rental income as a result.
The mall’s losses are caused by the result of the lighting supplier’s breach of contract
with Bright Lite, and so are considered consequential damages.
https://en.wikipedia.org/wiki/Incidental_damages

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