Reliance damages are a type of legal remedy awarded to a party in a contract dispute, intended to compensate for expenses incurred due to reliance on the contract that was not fulfilled. These damages aim to restore the injured party to the position they would have been in had the contract been performed, focusing on the losses directly resulting from their reliance on the promise. This concept plays an important role in evaluating how parties can protect themselves from losses when contracts are breached and aligns closely with economic theories regarding efficiency and decision-making.
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