1. Damages are a common law remedy, and they may be claimed by an injured party as of right.
They are money compensation for the loss suffered. Their object is to put the injured party into the position in which he would have been had the loss not been suffered, i.e. had the contract not been broken.

2. General rules governing damages
a) The value of the loss ('measure') is assessed objectively, according to the value that an ordinary, reasonable person would put on it. This will normally be the market price for goods and services.
b) The damage recoverable must arise from the breach of contract itself and must not be too 'remote'. The test calls for 'what arises naturally out of such breach' or 'what has been in contemplation of the parties as the probable result of such breach, even if it is not a natural consequence':
Hadley v. Baxendale 1854 - Rule I.
Victoria Laundry (Windsor) Ltd. v. Newman Industries Ltd. 1949 - Rule II with mixed results.
Foreseeability and remoteness in contract and tort reconsidered; especially drop in re-sale value:
The Heron II, Koufos v. C. Czarnikow Ltd. 1969 - less foresight (of the parties) required in contract.
Damage similar in 'type' will be treated as foreseeable even though the actual form it takes could not have been fore- seen: H. Parsons (Livestock) Ltd. v. Uttley Ingham & Co. Ltd. 1978 - illness and death of livestock.
c) If the parties agree to pay a certain sum of money in case of breach, and if that sum is a genuine pre-estimate of the value of the loss, a suit lies in respect of liquidated (quantified) damages.
The sum so assessed must not be a 'penalty' - such agreements are not enforceable in English law.
d) In contract, there are no exemplary damages.
e) Damages may also be recovered in respect of inconvenience, frustration, disappointment, anxiety etc. (as in tort).
f) There must be a causal connection between the defendant's default and the plaintiff's loss:
Quinn v. Burch Bros. (Builders) Ltd. 1966 - failure to provide ladder, pl. used other one instead, claim failed.