How Does Breach of Contract Litigation Work?

When two or more parties enter a contract, they are typically bound to fulfill certain obligations. If any one party fails to comply with or fulfill its contractual obligations, it leads to a breach of contract. Examples of breaches include non-performance, not delivering on time, and non-compliance with guidelines. Once a breach occurs, the non-breaching party has the right to seek legal recourse.

Are There Different Types?

Depending on the specifics of your case, you might be involved in different types of breach of contract cases. These include:

  • Material breach. The breach is substantial enough to cancel the contract because it keeps one or both parties from fulfilling their part. Receiving a wrong item would fall under this category.
  • Anticipatory breach. This is when a party suspects that the other party will breach the contract based on specific reasons. It can also take place when one party tells the other that it will not be fulfilling the contract’s terms.
  • Partial breach. A partial or minor breach occurs when one party fails to fulfill a small or relatively insignificant detail, but can still continue to perform its overall role. It can also involve technical errors within a contract.

The Validity of a Contract

While enforcing an oral contract is possible, some types of agreements need to be in writing to hold ground in court. These typically include contracts surrounding sales of goods or services that exceed $500 in value, contracts that remain valid for more than a year from signing, and transfer/sale of real estate contracts.

Role of the Court in Establishing Validity

Once your breach of contract case reaches court, it reviews each party’s responsibilities and determines it all parties have played their due roles. The court takes a close look at the contract to check for modifications that might have resulted in the alleged breach.
It is upon the court to determine if the breach was the result of legal reason. For instance, if a defendant says that a plaintiff concealed or misrepresented material facts, which makes the contract fraudulent, the court needs to look into this claim. Similarly, a defendant might claim that a plaintiff used threats or physical force, which compelled the defendant to the sign the contract under duress.

Your Role in Breach of Contract Litigation

Your role in any type of breach of contract litigation depends on whether you are the breaching or non-breaching party.

Non-Breaching Party

As a non-breaching party, you have the right to seek legal remedy. In this case, follow these steps.

  • Go through the contract carefully and look for clauses that surround breaches. Do they mention damages you stand to receive, or a time frame that the breaching party gets to fix the breach?
  • Inform the breaching party of the breach and give it an opportunity to resolve the problem, either by fixing it or by arriving at a mutually agreeable solution.
  • If the last step fails, the non-breaching party needs to initiate a breach of contract lawsuit against the breaching party.

Breaching Party

If you are held responsible for a breach of contract, consider following these steps.

  • Go through the contract to find out what you might be able to do in the event of a breach. For instance, while a breach might lead to a contract’s immediate termination, it might also give you some time to resolve the problem before the non-breaching party can go to court.
  • If you are unable to fix the breach completely, try to discuss possible alternatives with the non-breaching party. This might lead to a resolution without the involvement of court.
  • If the non-breaching party files a lawsuit against you, you need to defend your case in court, ideally by appointing a breach of contract litigation attorney.

Remedies for Breach of Contract

Damages and injunctions are the most common outcomes of breach of contract litigation cases. Damages refer to the money that a defendant needs to pay a plaintiff to cover for the latter’s loss or suffering. An injunction requires that a defendant cease doing anything that might cause damage or suffering to the plaintiff. Non-breaching parties may also seek cancellation or restitution of their contracts.

Conclusion

If you feel that a party with which you have entered into a contract is breaching its terms in some way, discuss the matter with the other party first and determine if you might be able to solve the problem mutually. If this cannot happen, it is best that you seek advice from an attorney who specializes in breach of contract cases at the earliest because statute of limitations might apply later.

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