The duty to mitigate refers to a party’s obligation to make reasonable efforts to limit the harm they suffer from another party’s actions. Parties have a duty to mitigate in both torts and breaches of contracts. Failure to discharge this duty to mitigate precludes the recovery of damages that could have been avoided through reasonable efforts.
- If A agrees to sell B 100 apples for $5 each, and later refuses to sell those apples, B must look for a new apple seller before they can sue A for damages because of B’s duty to mitigate.
- Because the overarching goal of contract law is to place parties in the same situation they would have been in had no breach of contract occurred, A’s liability for the breach will decrease if B can successfully find a new apple seller through reasonable means.
- If B can find someone else to sell 100 apples for $6 each, B can only recover $100 from A for the breach because $100 would place B in the same situation as if no breach had occurred.
- Additionally, if B fails to search for a new apple seller, A is absolved of liability for the breach.
[Last updated in August of 2022 by the Wex Definitions Team]