Damages and Benefits: New Rules for the Compensatio Lucri Cum Damno Doctrine

In certain cases, an unlawful act or a breach of contract, apart from disadvantageous consequences, could confer economic benefit on the injured party. For determining the compensation, in such cases it is necessary to take account not only of harms suffered by the victim, but also the advantages that he or she has possibly achieved. Generally, the law scholars expressed that need with the elaboration of the “compensatio lucri cum damno” doctrine. On 22 May 2018, in order to clarify a contrast existing among the different Sections, the Sezioni Unite of the Italian Court of Cassation provided a meticulous discussion of the foundations and the rules of this doctrine. The Court put particular emphasis on clarifying whether collateral benefits obtained by the injured party in connection with an unlawful act needs to be deducted from the amount obtained as compensation of the tortious act. Before examining the new position that the Italian Supreme Court has assumed with the recent decisions of the United Sections on compensatio lucri cum damno the article analyzes the origins of the doctrine, its foundations and the traditional sphere of operation in the Italian law system. Finally, some concluding remarks will be formulated.