Question

Julie signs a contract to buy Nick's 2002 Mustang GT for $5,000. Later, Nick changes his mind and refuses to sell his car. Julie soon buys a similar 2002 Mustang GT for $5,500. She then sues Nick and wins $500. The $500 represents her _____ interest.

A) Compensatory damages
B) Punitive damages
C) Incidental damages
D) Nominal damages

Answer 1

The $500 represents Julie's compensatory damages.

Step-by-step explanation:

The $500 represents Julie's compensatory damages.

Compensatory damages are a type of legal remedy that aim to compensate a party for the actual loss or harm they suffered as a result of another party's breach of contract or wrongful act. In this case, Julie had to spend an additional $500 to buy a similar car after Nick refused to sell his car. The court awarded her $500 to compensate for this financial loss.

Unlike punitive damages, which are meant to punish the wrongdoer and deter others from similar actions, compensatory damages are designed to restore the injured party to the position they would have been in had the breach or harm not occurred.