Jurisdiction(s):
United Kingdom

Key definition

Contract definition

What does Contract mean? In legal practice, a contract is the enforceable agreement by which parties set out promises and allocate risk, whether made orally, in writing or by conduct. The law of contract is principally case-law driven across England & Wales, Scotland, Northern Ireland and Ireland, with statutory interventions on formalities, construction and consumer protection. In England & Wales, Northern Ireland and Ireland, formation generally requires offer, acceptance, consideration and an intention to create legal relations. In Scotland, consideration is not required; a contract is formed by agreement (consensus in idem) with the necessary intention, with writing only needed in defined cases. Key features...

Non-pecuniary contractual damages: availability and assessment of punitive, distress/amenity, reputation, restitutionary and negotiating damages

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Practice notes

This Practice Note examines the various categories of Contractual Damages available for non-financial (non-pecuniary) Loss—namely punitive damages, damages for loss of enjoyment and loss of amenity, restitutionary damages, and negotiating damages (previously referred to as ‘Wrotham Park damages’). For guidance on contractual damages in general, see Practice Note: Contractual damages—General Principles. For damages addressing financial (pecuniary) loss for breach of contract, see Practice Note: Contractual damages—pecuniary losses.

Contractual damages—categories of non-pecuniary loss

Damages for non-pecuniary loss are granted only in exceptional circumstances, as such awards run counter to the basic principle that damages are strictly compensatory. They include:

punitive damages
damages for loss of enjoyment and loss of amenity
restitutionary damages
negotiating damages

Non-pecuniary loss—punitive damages

Punitive damages are awarded where the defaulting party’s conduct is so egregious that punishment is warranted. These awards are rare in tort and are almost certainly irrecoverable in contract. They usually exceed the claimant’s actual loss, aiming to penalise the defendant rather than to compensate the claimant...

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Web page updated on 21/05/2026

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