A contract is a legally binding agreement between two or more parties. Failing to perform the terms of the agreement can result in a minor breach of contract or a material breach of contract. First, you need a valid contract that is enforceable under your state laws.
A valid contract must have a minimum number of elements for a court to enforce the contract. At a minimum, a contract must include these elements to be enforceable: an offer, acceptance, consideration, mutual agreements, and capacity. If a party fails to perform any of the terms of the contract, the party is in breach of contract. The non-breaching party may have one or more legal causes of action to remedy the contract breach.
What Qualifies as a Breach of Contract?
Abreach of contractoccurs when a party to the contract does not perform the outlined terms. Because contracts are governed by state laws, the legal elements required to prove a breach of contract claim can vary. However, most states require that the case involves a valid, legally enforceable contract. Other basic elements of breach of contract cases include, but are not limited to:
- The non-breaching party performed the requirements of the contract
- The breaching party did not perform the requirements of the contract and the breach was not excused
- The breach occurred within the statute of limitations for filing breach of contract cases
- The lawsuit was filed before the expiration of the statute of limitations
- The non-breaching party sustained harm or damages
- The breach was the direct and proximate cause of the non-breaching party's damages or harm
Proving each element of a breach of contract claim is essential for recovering damages for breach of contract.
Material vs. Minor Breaches of Contract
Breaches of contract can be categorized as a material breach or a minor breach of contract. A minor breach of contract occurs when a party to a contract performs most of the terms of the contract. The party may fail to perform a minor term of the contract that does not significantly impact the other contract terms.
On the other hand, a material breach of contract is considered a major breach of the terms of the agreement. A minor breach of contract usually does not prevent the completion of the contract in a manner that results in a satisfactory result. However, a material breach makes it difficult or impossible to achieve a satisfactory result.
In some jurisdictions, anything less than complete performance is a material breach of contract. In those jurisdictions, any breach discharges the nonbreaching party from the contract. In other words, the non-breaching party has no further performance requirements under the contract and may sue for damages.
However, the laws in some states leave the matter to a judge or jury to determine whether a minor breach of contract occurred and if any remedies are appropriate. If the non-breaching party received the same outcome, even though there was a minor breach of contract, damages may or may not be awarded. Also, the non-breaching party will be required to complete the contractual obligations.
What Are the Legal Remedies for Breach of Contract?
The consequences of breach of contract depend on your state's laws. If you live in a state that does not void an agreement for a minor breach of contract, your options and remedies for breach of contract might be limited.
However, if the other party commits a material breach, you may have the legal right to cease to perform your obligations under the agreement and sue for damages. Before yousue for breach of contract, it is best to consult with an experienced contract attorney near you. You do not want to risk legal liability for failing to perform your obligations for a minor breach of contract that does not result in voiding the contract.
Depending on the laws in your state and the facts in your breach of contract case, potential legal remedies for breach of contract cases include, but are not limited to:
- Rescission (releases the non-breaching party from performance obligations)
- A court orders the breaching party to perform the terms of the agreement (specific performance)
- Compensatory damages (monetary damages for losses caused by the breach of contract)
- Punitive damages (typically only awarded in cases involving fraud)
- Restitution (returning the injured party to the position it was in before signing the contract)
