Mitigation of Damages
What does the duty to mitigate damages entail in contract law?
The duty to mitigate damages in contract law requires that a party suffering from a breach of contract take reasonable steps to reduce their losses. This means not increasing the damage and making efforts comparable to what any reasonable person would take in a similar situation.
How does the mitigation of damages apply in employment law?
In employment law, mitigation of damages involves a terminated employee actively seeking new employment to offset lost wages. The employee must prove they have made reasonable efforts to find comparable work to reduce the financial impact of their job loss.
What repercussions arise from not fulfilling the duty to mitigate damages?
Failing to mitigate damages can significantly reduce the amount of compensation an injured party can recover. Courts will typically reduce the damages awarded by the amount that could have been avoided through reasonable mitigation efforts.
Are there any exceptions to the requirement to mitigate damages?
Yes, there are exceptions. For example, an injured party is not required to take steps that would involve unreasonable effort or expense or that are substantially different from their original situation. The specifics can vary based on jurisdiction and the exact circumstances of the case.
Can mitigation of damages apply to rental property agreements?
Yes, in rental agreements, if a tenant breaks a lease, the landlord must make reasonable efforts to re-rent the property to mitigate lost rental income. However, the landlord is not required to rent the property under market value or accept unsuitable tenants.
Reference:
- Cornell Law School
- FEMA| U.S. Govt
- U.S. Customs and Border Protection
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