Which type of loss compensates for the benefits expected from a contract?

Expectation loss is designed to compensate a party for the benefits they anticipated from a contract had it been fulfilled. This concept is grounded in the principle that parties should be put in the position they would have been in had the contract been performed as agreed. This form of loss encompasses not only the direct damages that arise from a breach of contract but also any consequential benefits that were reasonably foreseeable at the time the contract was formed.

In contrast, actual loss refers to the tangible losses incurred due to a breach, while reliance loss compensates a party for expenses incurred in reliance on the contract, but not for the expected benefits. Liquidated loss is a specific amount predetermined by the parties to the contract as compensation for a potential breach but does not measure the expected benefits distinctly.

Therefore, expectation loss effectively bridges the gap between what was expected from the contract and what was ultimately received, serving as the main basis for compensation in breach of contract situations.