What is meant by the duty to mitigate damages?

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The duty to mitigate damages refers to the legal principle that a party suffering harm or loss due to a breach of contract or wrongful act is required to take reasonable steps to minimize or reduce those damages. This means that the injured party cannot simply sit back and allow the damages to accumulate; instead, they must actively seek to lessen the financial impact of the breach or harm.

For example, if an artist’s work is wrongfully used without permission, they have a duty to attempt to mitigate their losses by seeking alternative opportunities or negotiating a settlement, rather than letting the situation worsen. This principle encourages parties to make reasonable efforts to keep losses as low as possible, which benefits not just the parties involved, but also the legal system by preventing excessive claims.

The other options do not align with the concept of mitigating damages. Maximizing losses contradicts the notion of reduction, while a prohibition against taking legal action does not relate to minimizing damages but instead implies that the injured party cannot seek redress. Lastly, the right to refuse a contract does not pertain to the management of damages following a breach but relates to the initial acceptance of contractual obligations.

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