A party is entitled to compensation for damages as a consequence of the defendant"s breach of contract provided that the loss incurred is not too remote and could not have been avoided by reasonable mitigation. The standard used for determining compensatory damages is that the injured party should receive compensation to an amount which will put them in the same situation if the contract had not been breached. This means that the normal costs incurred in a situation where the contract had not been breached are included in the calculation of the damages so that the plaintiff gains no extra profit from the breach.
There are limits to what can be claimed as compensable damage to the extent, “that his or her expectation of a certain outcome had a likelihood of attainment rather than being mere expectation.” (Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64 at 84, 99) It is this expectation of profit, chance or opportunity that the plaintiff can seek compensation for. It should also be noted that the onus of establishing that a profit, chance or opportunity would have been earned lies on the plaintiff and requires factual evidence that is recognised by law.