What does mitigation refer to in terms of damages?

Mitigation in terms of damages refers to the obligation of a party who has incurred damages to take reasonable steps to reduce or minimize those damages. This principle is grounded in the idea that a party should not allow their losses to accumulate unnecessarily when they have the ability to limit them.

In a legal context, when a plaintiff suffers a loss due to the actions of another party (such as in a breach of contract or tort case), they have a responsibility to make efforts to lessen the impact of that loss, which might include seeking alternative solutions or making adjustments to their situation. For example, if a contractor fails to complete a project, the injured party should actively seek to find another contractor to complete the work rather than simply allowing the situation to worsen.

This concept is essential in cases involving compensatory damages because courts may reduce the amount awarded if it can be shown that the injured party did not adequately mitigate their damages. Essentially, the focus of mitigation is on the proactive steps taken to curtail losses, making it a crucial aspect of damage calculations in legal proceedings.