Mario, a professional entertainer, entered into a one-year contract with Barnum to perform exclusively at Barnum's theatre and nowhere else during that period of time. A week after the agreement was signed, Mario entered into another agreement with a competitor of Barnum to perform at his opera house. The monetary amount that Barnum would be entitled to receive as compensation from Mario would be the amount of the loss that Mario could reasonably have foreseen at the time that the contract was entered into by the parties.

Question

Quizplus · Accepted Answer

This is the principle of foreseeable damages, which means that the party who breaches the contract is responsible for the damages that the other party could reasonably have foreseen at the time the contract was signed. Therefore, Barnum would be entitled to receive compensation for the loss that he could have reasonably foreseen as a result of Mario's breach of contract.

Mario, a Professional Entertainer, Entered into a One-Year Contract with Barnum