Which type of damages is meant to compensate the aggrieved party for actual injuries or damages?

Compensatory damages are designed specifically to address the actual injuries or damages experienced by an aggrieved party. Their primary function is to restore the injured party to the position they would have been in had the wrongful act not occurred. This type of damage covers both economic losses, such as medical expenses or lost wages, and non-economic losses, such as pain and suffering or emotional distress.

In contrast, exemplary damages are intended to serve a punitive purpose, designed to punish the wrongdoer rather than to compensate the victim. Nominal damages are a small amount awarded when a legal wrong has occurred, but there are no actual damages to compensate for, often demonstrating a legal principle rather than offering real remuneration. Punitive damages are meant to deter the wrongdoer and others from similar conduct, further highlighting their focus on punishment rather than compensation for direct losses.

Understanding these distinctions shows why compensatory damages are the appropriate type to directly address and make whole the party who has suffered actual harm.