Breach of Contract
Breach of contract occurs when one party fails to fulfill their obligations as outlined in a legally binding agreement. This can involve failing to perform, not performing on time, or performing in a manner that does not meet the terms of the contract. When a breach occurs, the non-breaching party may seek legal remedies, such as damages or specific performance.
7 Key excerpts on "Breach of Contract"
- B.S. Patil, S.P. Woolhouse(Authors)
- 2019(Publication Date)
- CRC Press(Publisher)
...10 Breach of Contract 10.0 Introduction A breach of a contract is failure to perform an obligation arising out of the contract. Where there is failure to perform an obligation, in whole, it is a total breach. When an agreement is broken only in part it is a partial breach. If a party announces, before his performance is due, his definite unwillingness or inability to fulfil the contract, he thereby admits he is guilty of a breach. The breach in such a case is called an anticipatory breach. Occasionally a party may deliberately incapacitate himself or render impossible the performance of his contract duties; or may so interfere to render performance by the other party impossible. Such tactics also constitute a Breach of Contract. Every breach of a contractual obligation confers upon an injured party a right of action. However, there are a number of valid excuses for non-performance of contractual obligations. An actionable Breach of Contract, therefore, occurs when a promisor, without sufficient excuse or justification, fails to perform in accordance with the dictates of his agreement. Further, there is a distinction between breach of a contract and termination of a contract. When a contract comes to an end it is said to be terminated. Breach of Contract may constitute a means of contract termination. However, there are a number of ways other than a breach by which a contract can be terminated. Full and satisfactory performance by both sides is the usual mode. The other modes include: Release under seal Rescission by consent of parties Accord and satisfaction Exercise of option given to a party in a contract to terminate under certain circumstances or events Rescission by a party on account of repudiation or non-performance by the other party Frustration or impossibility of performance It may be noted that many common forms of breach of important contract conditions are dealt with in their appropriate places in different chapters in this book...
eBook - ePub- Richard Stone, James Devenney(Authors)
- 2022(Publication Date)
- Routledge(Publisher)
...Breach, however serious, does not necessarily create an entitlement to terminate a contract – a key question is when a breach entitles the other party to terminate (‘repudiatory’ breach). The answer, generally, depends on the type of term breached. The courts divide contractual terms into the following: Conditions. Breach of a condition entitles the other party to terminate the contract (as well as claiming damages). Warranties. Breach of warranty only entitles the other party to claim damages, not to terminate. Innominate terms. The consequences of breach of an innominate term depend on the seriousness of the breach. If it deprives the other party of the main benefit of the contract, it will allow that party to terminate. Problem areas. Long-term contracts. It may be difficult in a long-term contract to determine what level of breach will be repudiatory. Instalment contracts. Similarly, there may be difficulties in determining how many instalments need to be defective to constitute a repudiatory breach. Anticipatory breach. If a party indicates in advance that it is not going to perform, the other party may elect to terminate immediately, rather than waiting for the date for performance to arrive. 14.2 INTRODUCTION This chapter is concerned with ways in which contractual obligations may be discharged. We have already discussed one way in which this can happen in the previous chapter, under the doctrine of frustration. Contracts may also be discharged by express agreement. If both parties decide that neither of them wishes to carry on with a contract that contains continuing obligations, or in relation to which some parts are still executory, they may agree to bring it to an end early. The main problem that arises here is where the executory obligations are all on one side, so that the party who has completed performance prima facie receives no consideration for promising not to enforce the other party’s obligations...
eBook - ePubComparative Contract Law
An Introduction
- Ermanno Calzolaio(Author)
- 2022(Publication Date)
- Routledge(Publisher)
...8 Breach of Contract DOI: 10.4324/9781003251606-8 8.1 Specific performance and/or damages The civil law systems are familiar with a basic principle in the case of Breach of Contract: the performing party has the right to specific performance (or ‘direct enforcement’, according to another terminology often used), unless this is materially impossible (for example, if a singer refuses to sing). As far as it is possible, the law protects the interest pursued by the performing party when concluding the contract, so as to obtain performance from the other party. From this perspective, damages are considered as an unsatisfactory equivalent. If a person concludes a valid contract in order to buy a painting and subsequently the painter refuses to deliver the painting, the interest of the buyer is to have that painting, not to have the equivalent monetary compensation. That is why the legal system provides for specific performance. In principle, the common law approach is different. Damages are the rule and specific performance the exception. 1 The reasons for such a sharp difference are closely connected with the historical evolution of contract law rules from the writ of trespass, an ‘extra-contractual’ remedy that was progressively extended to cover cases of breach of a contractual promise (‘assumpsit’). A successful trespass action gave rise to damages. That is why, by default, damages was the relief for Breach of Contract. Specific performance gradually evolved only as an equitable remedy. 1 J. Cartwright, Contract Law. An Introduction to the English Law of Contract for the Civil Lawyer, 2nd ed., Oxford University Press, Oxford, 2013, p. 265. With these basic ideas in mind, it is now possible to distinguish between the enforcement of (a) non-monetary obligations and (b) monetary obligations. In the case of non-monetary obligations, the difference between civil law and common law described above emerges quite clearly...
eBook - ePub- Chris Monaghan(Author)
- 2015(Publication Date)
- Routledge(Publisher)
...Where a condition has been breached the innocent party may choose to treat the breach as amounting to a repudiatory breach and this will discharge the contract. The innocent party may still obtain damages from the defendant. Alternatively, the innocent party may affirm the breach and thus choose to keep the contract alive (see Figure 3.3). He may still obtain damages for the breach. Sometimes a party may inform the other party that there will not be Breach of Contract before the breach occurs. This is known as an anticipatory breach. The innocent party may be able to affirm the breach and continue with their own obligations and thus will be able to attempt to recover the full contractual amount owed (see White & Carter (Councils) Ltd v McGregor [1962] AC 413). REMEDIES FOR Breach of Contract In Chapter 2 we saw how the courts can award both common law and equitable remedies. Where there is a Breach of Contract the innocent party, depending on how the term is classified, may have a right to repudiate the contract. The usual remedy for Breach of Contract is common law damages. The measure of damages is intended to protect the claimant’s expectation interest, that is to seek to put the claimant in the financial position that she would have been in had the defendant performed his contractual obligations. However, the claimant could instead seek to recover her reliance interest, which would recover any expenses incurred in performing her obligations. The courts may refuse to permit the claimant to recover her expectation interest where it is impossible to say with certainty just what the claimant’s financial position would have been had the contract been performed. Where this occurs the courts may calculate damages according to the reliance interest (see Anglia Television Ltd v Reed [1972] 1 QB 60). The claimant must prove that the defendant caused her losses and that the damages sought cannot be too remote and must be foreseeable (see Hadley v Baxendale (1854) 9 Ex 341)...
eBook - ePubBusiness Law
A Straightforward Guide
- (Author)
- 2014(Publication Date)
- Straightforward Publishing Digital(Publisher)
...The arrangement is often termed accord and satisfaction.FormalitiesThis issue arises in connection with certain types of contract (mainly concerning the sale of land) that must be evidenced in writing to be binding under the Law of Property Act (1925).Remedies for Breach of ContractThere are a number of remedies available to the innocent party in the event of a breached contract. There are two main remedies, those under common law and equitable remedies. There is a third category that involves remedies arising from the party’s own agreement.1.8REMEDIES FOR Breach of ContractThe usual Remedy for Breach of Contracts is the award of damages to the innocent party. It aims to compensate for losses that result from not receiving performance that was due under the contract. In general the damages will cover both physical harm to the claimant and their property and also for any economic loss. There are very limited circumstances in which injury to feelings can be compensated for.Damages can fall into the categories of unliquidated damages, which are damages assessed by the courts, the purpose of which is to compensate the victim for the loss he has suffered as a result of the breach and liquidated damages where the damages are set by the parties themselves.When considering damages the general rule is that any damages are awarded innocent parties will place them in a position they would have been if the contract had been performed. There are, however, three limitations: causation, remoteness and mitigation.CausationA person will be liable only for losses caused by their own Breach of Contract. Acts intervening between the Breach of Contract and the loss incurred may break the chain of causation. One case illustrating this is County Ltd v Girozentrale Securities (1996) where the plaintiff’s bank agreed to underwrite the issue of 26 million shares in a publicly quoted company...
eBook - ePub- Scott J. Burnham(Author)
- 2011(Publication Date)
- Wiley(Publisher)
...These defenses include illegality, lack of consideration, lack of capacity, fraud, mistake, and the like. When the contract is avoided because of a defense after one party already conferred a disproportionate benefit on the other party, the courts can ensure a fair outcome by using the principles of restitution to compensate the party who conferred the disproportionate benefit. If I sell my house to you and you prove that we entered into the transaction because of a mutual mistake, contract law rescinds the contract and discharges our duties. You return title of the house to me, and I return the payments you made. However, because you got the benefit of living in the house, the court may require you to make restitution to me for your use of the house before the rescission. A material breach: If we have a contract and you commit a material breach, I have the option of declaring that my performance under the contract is discharged (check out Chapter 14). In addition, I can recover damages for the breach. Whether you can recover restitution for any performance you rendered prior to the breach was at one time hotly debated. Now the position of the Restatement, as found in § 374, is that the breaching party is entitled to restitution. In the 1834 case of Britton v. Turner, Turner employed Britton to work for one year for $120. Britton breached the contract after nine and a half months. Because this was material breach of an entire contract, Turner was entitled to consider the contract at an end and claim damages. The issue was whether Britton had a claim for the work he had done prior to the breach. The court must have concluded that he couldn’t claim damages for Breach of Contract because he didn’t substantially perform. His claim was in restitution for the value of the benefit he had conferred on Turner...
eBook - ePub- Roger ter Haar(Author)
- 2017(Publication Date)
- Informa Law from Routledge(Publisher)
...Chapter 11 Damages for Breach of Contract Some other general principles 11.1 Some other general principles that can affect the amount of damages recoverable for Breach of Contract are now considered. Causation 11.2 If there has been a Breach of Contract, the contract-breaker is liable to pay at least nominal damages. To recover more than nominal damages the claimant must prove what loss he has suffered – or, in legal terms, he must prove what losses have been “caused” by the Breach of Contract. 11.3 If a Breach of Contract by a defendant is to be held to entitle a claimant to recover damages, it must first be held that the breach was an “effective” or “dominant” cause of his loss. 1 The courts distinguish between a breach that is the cause of a loss and a breach that is merely the occasion for loss. 2 This distinction was illustrated by an Australian judge, Mahoney JA as follows: 3 “If a defendant promises to direct me where I should go and, at a cross-roads, directs me to the left road rather than the right road, what happens to me on the left road is, in a sense, the result of what the defendant has done. If I slip on that road, if it collapses under me, or if, because I am there, a car driving down that road and not down the right road strikes me, my loss is, in a sense, the result of the fact that I have been directed to the left road and not the right road. But, in my opinion, it is not everything which is a result in this broad sense which is accepted as a result for this purpose in the law. Thus, if, being on the left road, I slip and fall, the fact alone that it was the defendant’s direction, in Breach of Contract, which may put me there will not, without more, make the defendant liable for my broken leg. I say ‘without more’: if there be added to the breach the fact that, for example, the left road was known to be dangerous, I may, of course, be liable...
