Whether you own a business or partner with a business, you likely have in place contracts that dictate the roles and obligations of your relationship. These agreements can be critical in preventing and resolving disputes, but only when parties comply with them.
If a party breaches — or is accused of breaching — a contract, legal actions and remedies like those we discuss below may be appropriate.
Assessing the alleged breach
When there are concerns of a breached contract, parties will want to assess the type of breach. Reviewing the contract with an attorney at this point is typically vital. If you determine that you or the other party failed in the performance or obligations of the contract, then it can be a breach.
But before you assume legal action is inevitable in the event of a breach, you will need to categorize the breach. Was it material, or an essential component of the contract? Was it immaterial, or minor and not pertinent to the completion of the contract?
Depending on the type of breach, there can be at least a few different remedies. These remedies include:
- Payment of damages resulting from the breach
- Performance of duty or the completion of duties promised in the contract
- Contract cancellation
Depending on the specific details of a case, parties might seek one or more of these remedies.
Parties can negotiate these remedies themselves through mediation or arbitration outside of court, which can save time and money. If these methods are not feasible or successful, then the case can go to court where a judge will make a determination and order relief, if appropriate.
There can be a lot on the line when it comes to contract disputes. Therefore, it is important to take accusations of breaches seriously and consult an attorney to assess your legal options.