101 South Hanley, Suite 1280 Clayton, MO 63105
314.283.8930

Benefit of the Bargain Contract Damages, Lost Profits

If a plaintiff is successful in a breach of contract claim, he/she may recover the “benefit of the bargain,” as well as damages naturally and proximately caused by the breach and damages that could have been reasonably contemplated by the defendant at the time of the agreement. Birdsong v. Bydalek, 953 S.W.2d 103, 116 (Mo. Ct. App. 1997). The benefit of the bargain is often reasonably straightforward: the monetary amount the plaintiff would have received had the contract been fully performed. But what can constitute additional natural and proximate damages?

The answer to this question varies from case to case, but the biggest items falling within this inquiry are usually general consequential damages or lost profits. Catroppa v. Metal Bldg. Supply, Inc., 267 S.W.3d 812, 818-19 (Mo. Ct. App. 2008. To give an example of consequential damages in a business setting, fixed overhead expenses that would have been paid from the gross revenue generated by a breached contract can be recovered if such expenses are proven by substantial evidence. American Laminates, Inc. v. J.S. Latta Co., 980 S.W.2s 12, 24 (Mo. Ct. App. 1998).

For lost profits, a party must produce evidence that provides an adequate basis for estimating the lost profits with reasonable certainty. Ameristar Jet Charter, Inc. v. Dodgson Int’l Parts, Inc., 155 S.W.3d 50, 54 (Mo. 2005). While additional evidence would be helpful, Missouri law does provide that testimonial evidence alone is sufficient for estimating lost profits. Parshall v. Buetzer, 195 S.W.3d 515, 523 (Mo. Ct. App. 2006) (business owner’s testimony that “based on his many years’ experience in the concrete business, he would have earned fifteen per cent profit on that job … established the fact of lost profits with reasonable certainty, and was sufficient to support the amount”). Ideally, however, it is better to produce supporting documentation as opposed to relying on bare testimony.

Contact with questions.