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What is a Breach of Contract?

In order to understand what a breach of contract is, you first have to understand the parameters of a contract. A contract is a legally-binding agreement made between two parties, obligating one or both parties to specific duties. Contracts can either be verbal or written, but when they are verbal they are more difficult to define. If it is mutually understood by both parties that the contract was binding and a party does not uphold their side of the contract, then a breach of contract has taken place. A breach of contract is a legal cause for action taken against a party and if convicted, they will be said to have committed a civil wrong.

There are four main types of contract breaches that it is possible to commit:

  • Minor Breach: A minor breach is a type of breaking of promise that does not include failure to perform all the duties of the contract. The contract at its very foundation was not broken in whole, but rather in part. This is in direct contrast to a material breach.
  • Material Breach: This type of breach is so substantial that it nullified the contract in whole. For example, if a business owner paid a contractor to install porcelain sinks in every bathroom, but the contractor did not complete any part of this action, whether by statement or by avoidance, then the business owner can file a breach of contract to either cancel the contract or even sue.
  • Fundamental Breach: This can also be called a repudiatory breach and can warrant a termination of contract or suing for damages. It takes place when the breach caused a detriment to the other party.
  • Anticipatory Breach: This type of breach takes place when the promising party refuses to uphold their side of the contract by declaration of intent. This happens before the promising party actually refrains from upholding the contract, and instead states ahead of time that they do not intend to do so.

If you have entered into a legally-binding contract with someone, whether the relationship was business or personal, and the promising party did not uphold their side of the contract, you may be entitled to file a breach of contract claim. These can potentially cause a major detriment to the receiving party that they need compensation for. If you have entered into an agreement with someone and they breached that contract, then seek the help of a firm that deals with commercial litigation. At Arnold & Itkin, we have extensive experience in business litigation cases and know how to get our clients the compensation they deserve.

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