Reinforcing Contractual Obligations Through Litigation
When two or more parties are mutually bound by the terms of a contract/agreement and one of the parties fails in their performance of the terms of that agreement, including by failing to perform their contractual promise(s), providing information informing the other party that they intend to not perform their duty or being unable to perform their duty as stated by the terms of the agreement, that party is in breach of contract.
Many breach of contract disputes can be settled without litigation by negotiation, mediation or arbitration (referred to as contract dispute resolution). Those cases that do not settle are left to contract litigation, where a lawsuit is filed in civil court.
Your Timing In A Breach Of Contract Dispute Matters
It is vital that you contact Simkin & Associates the moment that a breach occurs, as there may be specific duties to adhere to before holding the other party in breach of contract.
There may be certain methods and timing requirements pertaining to the notification by you to the breaching party that a breach has occurred. There may also be a contractual cure period, whereby the breaching party has a set contractual amount of time to cure the breach from when they are notified.
Understanding Breaches Of Contract
There are four common types of breaches of contract:
Minor breach: A minor breach of contract (also referred to as an immaterial or partial breach of contract) is where the breaching party does not adhere specifically to the terms of the agreement but such breach does not invalidate the agreement itself and cannot compel the breaching party to perform their contractual duty.
For example, if you hire a building contractor to do construction on your house and to then paint your house with a certain brand of paint and the contractor chooses another brand of paint that is of equal quality but perhaps of slightly lesser value, then you may sue the contractor for the difference in the actual value of the two brands of paint.
Material breach: In this case, one party has breached the contract terms in a way that has caused damage to the nonbreaching party.
An example of this would be if the seller of a house agrees to replace the heating unit of the property and then fails to do so, the nonbreaching party may sue for the damages incurred (e.g., the actual cost of adding the heater) or may cause the breaching party to perform their duty by purchasing and installing the heater.
Fundamental breach: A fundamental breach of contract is a breach so large that it provides the nonbreaching party with the right to invalidate the contract and sue for damages.
If a leasing company agrees to lease you an apartment or office space and it leases it to another person or business when you have already given up your lease on another location and expended time and money to prepare for taking over the new lease, then you can sue the breaching party (the leasing company) for damages and compel it to fulfill its duty by leasing the space to you.
Anticipatory breach: A breach of anticipatory repudiation occurs when a party’s failure to perform their duty to the contract is, to a reasonable person using common sense, training or experience, imminent and indicated or inevitable. This may entitle the nonbreaching party to an invalidation of the agreement and to damages incurred as a result of the breach.
Compensating For Breaches
Damages in most cases are monetary and are to place the nonbreaching party (when they are the receiver of the goods or service) where they would have been had the contract not been created or (when they are the provider of the goods or service) where they would have been had the contract been fully completed. When a monetary value cannot be ascertained or is not sufficient to compensate the nonbreaching party, there may then be an equity decree entered by the court with an award of an injunction or specific performance.
Hold The Breaching Party Responsible – Call Today
It is vital for the nonbreaching party to attempt to mitigate the breach when and where possible. This is among the many reasons that you should notify us as soon as possible when you become aware that a breach either has occurred or is likely to occur.