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What is a Breach of Contract?

Conference between attorney and client in regards to contract

A contract is an agreement between two or more parties where certain factors are bargained for between the parties. For example, contracts can take place with the sale of goods, for the purchase of a home, or even in employment contracts. But what happens when a party fails to meet the requirements of the contract? Do you have a legal claim against the party? The following is a discussion regarding breach of contract and what your legal options could be after a breach of contract has occurred.

Each contract contains various obligations that parties must have to fulfill when they enter into the contract agreement. When one party fails to fulfill the obligation enforced by the contract, the party is known to be in “breach of the contract.” Breaching the contract can take place in many different forms, such as when the party fails to deliver goods or when the party fails to finish their performance. A breach of contract can be described as a material breach or an immaterial breach depending on when the party failed to perform. The different types of breach determine how much damage the non-breaching party could receive.

Breach of Contract Example

The most common breach of contract instances our personal injury attorneys have seen  is through employment contracts.

For example, if a new employee signs on with an employer for a salary of $2,000 every two weeks, but the employer fails to pay that amount, the employer has breached the employment contract. The employee could then file a lawsuit for breach of contract against the employer to receive the difference in how much she received versus how much she was supposed to receive under the employment contract. Our workplace discrimination attorneys have extensive experience determining how an employment contract is created end how a breach may qualify for damages.

Could I file a lawsuit for breach of contract?

The non-breaching party could file a lawsuit against the breaching party for the damages sustained. We advised that when a party breaches their contract, the next step would be for the plaintiff to initiate a lawsuit against the defendant in order to resolve the contract.

What do I have to prove in a breach-of-contract claim?

Our experienced contract attorneys understand that a breach-of-contract claim could be very complex and involve multiple parties. That is why it is important to hire an experienced and skilled contract attorney to pursue your claims and make sure that there is strong evidence to support the claim. In order to establish a breach of contract, the non-breaching party must prove that:

  • There was an enforceable contract: the contract should be very clear and outline all terms. Failure to outline all the terms may lead to the determination that the contract is void.
  • The Plaintiff has performed their obligations under the contract
  • The breach of contract was material

How much can you sue for breach of contract?

Each contract case differs depending on how much damages were suffered by the plaintiff. For example, if the plaintiffs suffered $100,000 in damages, then the plaintiff would assert a $100,000 breach of contract claim against the breaching party.

Remedies for Breach of Contract

There are different remedies a plaintiff could receive from a breach of contract claim. This depends on what the plaintiff is trying to achieve, and whether the contract has been partially performed. The different remedies regarding a breach of contract include:

  • Damages: this occurs when the non-breaching party simply wants to get monetary compensation and to be placed in the position they would have been in had the contract been performed.
  • Specific performance: this occurs when the plaintiff does not want to receive monetary damages because money damages are an inadequate legal remedy. This occurs when the plaintiff wants the contract to be carried through. This most commonly occurs in real estate contracts when there is a contract between a buyer and the seller, however the seller breaches by refusing to hand over the property. The buyer could file a lawsuit for breach of contract against the seller for specific performance in order to have the property sold to them.
  • Cancellation: the plaintiff could ask the court to have the contract canceled, also known as “rescission”, if the plaintiff does not want to move forward with the contract terms anymore.
Business lawyers discuss breach of contract

What is a material breach?

Occurs when one party fails to perform their duties as described in the contract. For example, the breaching party could fail to fulfill any obligations. This is the most severe type of breach.

What is an anticipatory breach?

This occurs when a party communicates to the other party prior to breaching that they will be unable to fulfill the contract requirements.

What is a minor breach?

A minor breach is considered a partial breach. This occurs when the breaching party has only fulfilled part of their obligation described in the contract. A plaintiff would most likely want to pursue monetary damages for a minor breach.

What are the different types of damages I could receive from a breach of contract claim?

The different types of damages differ depending on the type of situation and the type of contract. For example, a service contract would not result in the same number of damages as a real estate contract. Examples of the different kinds of damages include:

  • Compensatory damages: this is to put the non-breaching party in a position they would have been in had the contract been carried out.
  • Punitive damages: this occurs when the breaching party engages in some type of malicious behavior. This is not commonly awarded in California or Nevada.
  • Nominal damages: if the Plaintiff did not suffer any type of damages, but the defendant breached the contract, the plaintiff could recover some type of nominal damages in order to show that the contract was breached.
  • Liquidated damages: this refers to the type of damages stated on the contract. For example, if the contract stated that if there was a breach, the defendant would pay plaintiff $2,000, then the plaintiff would only receive what the liquidated damages are. Liquidated damages are analyzed through the reasonableness standards of the courts.
Close up of torn legal contract

Contact Our Attorneys for your Breach of Contract Claim Today

If you believe that another party has breached a contract, contact our attorneys today to decide on how to proceed with your claim. Our experienced contract attorneys have decades of experience representing various different types of contracts, from employment contracts to real estate contracts. Our attorneys want to make sure that our clients are involved and informed every step of the way when filing a breach of contract dispute against the other party. We offer our clients various different types of alternatives in order to make sure that their contractual rights are represented. Contact us at Heidari Law Group today for a free case consultation.

***Disclaimer: This page is created by Heidari Law Group for educational purposes. This article provides a general understanding of the law. It does not provide specific advice. By using this site and reading through this page, there is no attorney-client relationship created between you and any member of Heidari Law. Further, due to the constant change of the law, some parts of the information above may no longer be good law.

Sam Heidari

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