In Hadley v Baxendale, 9 Ex. 341 [1854], of 1L Contracts lore, the Court of Exchequer set out the dichotomy of direct damages and consequential (or indirect) damages. In the 170 years that have followed, lawyers on both sides of the Atlantic have sought to parse out what are direct damages and what are consequential damages. In the March 20, 2025 installment of the Toolbox Talk Series, Gaetano P. Piccirilli and C. Quincy Conrad discussed this frequently disputed and convoluted classification of damages as direct or consequential in construction disputes.

Gaetano and Quincy noted the traditional explanations of direct and consequential damages almost invariably use those terms without explaining how the differ. For example, direct damages are frequently described as "necessary and usual" flowing from the breach. Consequential damages are described as "naturally, but not necessarily" flowing from the breach. Gaetano and Quincy recommend avoiding the use of whether the damages are "foreseeable."