California Civil Jury Instructions (CACI)

2422. Breach of Employment Contract - Specified Term— Damages

If you find that [name of defendant] [discharged/demoted] [name of plaintiff] in breach of an employment contract for a specified term, then you must decide the damages, if any, that [name of plaintiff] has proved [he/she] is entitled to recover. To make that decision, you must:

1. Decide the amount that [name of plaintiff] would have earned up to today, including any benefits and pay increases; [and]

2. Add the present cash value of any future wages and benefits that [he/she] would have earned up to the end of the term of the contract; [and]

3. [Describe any other contract damages that were allegedly caused by defendant's conduct.]

[If you find that [name of plaintiff] would have exercised [his/her] option to extend the term of the employment contract, then you may consider the total term of [name of plaintiff]'s employment contract to be [specify length of original contract term plus option term].]

Directions for Use

Use CACI No. 2407, Breach of Employment Contract—Unspecified Term— Employee's Duty to Mitigate Damages, if the defendant seeks an offset for wages plaintiff could have earned from similar employment.

Sources and Authority

Civil Code section 3300 provides: "For the breach of an obligation arising from contract, the measure of damages, except where otherwise expressly provided by this code, is the amount which will compensate the party aggrieved for all the detriment proximately caused thereby, or which, in the ordinary course of things, would be likely to result therefrom."

"Stated simply, the contract compensation for the unexpired period of the contract affords a prima facie measure of damages; the actual easured damage, however, is the contract amount reduced by compensation received during the unexpired term; if, however, such other compensation has not been received, the contract amount may still be reduced or eliminated by a showing that the employee, by the exercise of reasonable diligence and effort, could have procured comparable employment and thus mitigated the damages." (Erler v. Five Points Motors, Inc. (1967) 249 Cal.App.2d 560, 562 [57 Cal.Rptr. 516].)

In appropriate circumstances, the court may authorize the trier of fact to "consider the probability the employee would exercise the option in determining the length of the unexpired term of employment when applying the applicable measure of damages. . . ." (Oldenkott v. American Electric, Inc. (1971) 14 Cal.App.3d 198, 204 [92 Cal.Rptr. 127].)

"The trial court correctly found that defendants wrongfully terminated the employment contract and that the measure of damages was the difference between the amount Silva would have received under the contract and that amount which Silva actually received from his other employment." (Silva v. McCoy (1968) 259 Cal.App.2d 256, 260 [66 Cal.Rptr. 364].)

"The plaintiff has the burden of proving his damage. The law is settled that he has the duty of minimizing that damage. While the contract wages are prima facie [evidence of] his damage, his actual damage is the amount of money he was out of pocket by reason of the wrongful discharge." (Erler v. Five Points Motors, Inc., supra, 249 Cal.App.2d at pp. 567-568.)

"The burden of proof is on the party whose breach caused damage, to establish matters relied on to mitigate damage." (Steelduct Co. v. Henger-Seltzer Co. (1945) 26 Cal.2d 634, 654 [160 P.2d 804], internal citations omitted.)

Secondary Sources

21 California Forms of Pleading and Practice, Ch. 249, Employment Law: Termination and Discipline, § 249.21 (Matthew Bender)

(New September 2003)