No damage theory, no damages

Rose v. Aaron held that a damages award could not stand because it did not reflect restitution, reliance, or expectancy damages and lacked the necessary methodology to measure the plaintiff’s economic position had the contract been performed.

Specificaly, the Fifth Circuit that a damages award based on the cost of improvements to a ranch were not restitution (no benefit conferred on the breaching party), not reliance (expenditures were not made toward performing the contract), and not expectancy because the factfinder neither offset avoided costs nor quantified other claimed harms with objective evidence.

On expectancy damages in particular, the court faulted the absence of proof that the harms from the breach exceeded the gains the nonbreaching party realized by avoiding future performance, leaving the award ambiguous as to whether it placed the claimant in a better, equal, or worse position than full performance. No. 21-40718 (Oct. 17, 2025).