Wednesday, May 13, 2009

Damages for Breach of Services Contract Determined by Lost Profits

In Marbella Park Homeowners’ Association, Inc. v. My Lawn Service, Inc. (3D07-3278) the Third DCA reversed the circuit court's order granting summary judgment based upon an improper damage calculation.

"Marbella Park asserts that the trial court erred in awarding the full amount of gross payments as damages, without holding an evidentiary hearing." The Third DCA agreed. "The measure of damages for breach of a services contract is the non-breaching party’s lost profits...Lost profits are calculated by subtracting the non-breaching party’s performance costs from the contract price...Further, the burden of proving lost profits is on the non-breaching party. Indian River Colony Club, Inc. v. Schopke Constr. & Eng’g, Inc., 619 So. 2d 6 (Fla. 5th DCA 1993). Generally, proof of performance costs necessitates an evidentiary hearing. See, e.g., Berlant v. Nat’l Bank of Fla., 527 So. 2d 910 (Fla. 3d DCA 1988)."


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