 When a customer exceeds his or her overdraft limit, this constitutes a breach of contract, as the customer has agreed not to borrow more than agreed.When this happens, the injured party (in this case the bank) is entitled to be reimbursed with a reasonable sum to cover the costs it has incurred as a result of the breach, or otherwise the value of the injury expressed in cash terms (liquidated damages).The value does not have to reflect the actual amount of the losses, only that it is a reasonable estimate of such.