Page 7 - Calculating Lost Profits
P. 7
Contents
Chapter 1 — Introduction.................................................................................................................................... 9
Intent of the Practice Aid .................................................................................................................................... 9
Practice Aid Overview ........................................................................................................................................ 9
Case Study Background Information ................................................................................................................ 10
Chapter 2 — Legal Principles ............................................................................................................................ 11
Introduction ....................................................................................................................................................... 11
Lost Cash Flow Versus Lost Income ................................................................................................................ 11
Types of Damages............................................................................................................................................. 11
Causation........................................................................................................................................................... 12
Reasonable Certainty ........................................................................................................................................ 15
Foreseeability .................................................................................................................................................... 16
Distinguishing Alleged Violative Acts From Other Acts, Including Subsequent Events ................................ 16
Identifying Multiple Harmful Acts ................................................................................................................... 17
Chapter 3 — Lost Profits as a Measure of Damages ....................................................................................... 19
Introduction ....................................................................................................................................................... 19
Figure 3.1. Summary of Lost Profits ............................................................................................................ 20
Causes of Action Giving Rise to Lost Profits Damages Claims ....................................................................... 21
Breach of Contract ........................................................................................................................................ 21
Torts .............................................................................................................................................................. 22
Other Matters Giving Rise to Lost Profits Analysis ..................................................................................... 22
Chapter 4 — Calculation of Lost Profits .......................................................................................................... 24
Chapter 5 — Loss Period ................................................................................................................................... 26
Overview ........................................................................................................................................................... 26
Breach of Contract ............................................................................................................................................ 27
Torts .................................................................................................................................................................. 29
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