Nominal damages are awarded when:

• A. There is substantial loss or injury
• B. There is no substantial loss or injury
• C. There is punitive conduct
• D. There is a settlement

Answer: (B)

Nominal damages are awarded when a legal wrong has occurred but there is no substantial loss or injury. They are a small, symbolic amount that acknowledges the breach of rights without compensating for actual harm. This helps establish liability and vindicate the plaintiff’s rights even when no measurable damages exist.

If there is real loss or injury, the remedy is usually actual (compensatory) damages to cover that harm. Punitive damages, by contrast, are intended to punish particularly wrongful conduct and deter future acts. A settlement is an agreement to resolve the claim, not a court-awarded damages amount.