What Are My Options If My Business Contract is Breached?
January 15, 2018 by: Peters Law
In an ideal world, contracts would always be honored by both sides that signed them. But the real world of business is much more complicated. Delays happen, finances might not line up and other unexpected events might occur that lead to a breach of contract.
Depending on the specifics of a contract, breaches can occur when one side fails to complete the terms of the contract on time, does not perform in accordance with the contract or does not complete the terms at all. When a breach of contract occurs, one or both parties may seek to have the contract enforced on its terms (specific performance) or may try to recover damages for financial harm caused by the breach of contract.
If informal attempts at resolution in this situation fail, the most common next step is for one party to file a lawsuit. Lawsuits are not the only option – parties may elect to enter into mediation or binding arbitration to solve the problem. But sometimes, mediation and arbitration do not work.
In a breach of contract lawsuit, the party harmed by the breach may seek one of three primary remedies:
- Damages to cover the financial harm caused by the breach
- Specific performance, meaning that the courts will order the breaching party to carry out the terms of the contract under penalty of legal action
- Cancellation or restitution. Restitution puts the non-breaching party back into the position it was in prior to the breach. Cancellation voids the contract and relieves all parties of any obligation under the agreement.
If you have been affected by a breach of contract in a business setting, seek the services of a business litigation attorney.