For a party to recover breach of contract damages for the profits it would have made pursuant to a contract had the contract not been breached, the party must prove such damages with “reasonable certainty.” The reasonable certainty standard is consistent with Restatement (Second) of Contracts, §367 which states that damages cannot be recovered “for loss beyond an amount that the evidence permits to be established with reasonable certainty.”
Even though it might be difficult for the non-breaching party to establish the amount of its damages with reasonable certainty when it claims lost profit damages (the profits it would have made over the remaining term of the contract had it not been breached), a court should be reluctant to use the reasonable certainty standard to deny a recovery. A comment to Section 367 notes that doubts concerning the amount of damage are generally resolved against the breaching party where it is established that a significant loss has occurred.
