Breach of Contract: Definition, FAQs, and Examples

Breach of Contract Breach of Contract: Definition, FAQs, and Examples

Breach of Contract: Definition, FAQs, and Examples

It can be stressful if a contractual party does not perform their obligations. You can suffer losses and harm if agreed-upon assets are not delivered.

If you would like to learn about the breach of contract definition and the aspects and elements you need to pay attention to, you have come to the right place. This article provides information and offers useful tips for settling a dispute fast.

What Is a Breach of Contract?

A breach of contract is any type of violation of terms and obligations specified and agreed upon in an agreement.

A contractual party can be in a breach of contract by, for instance, being late or failing to deliver the agreed:

  • Goods
  • Services
  • Payments

What Happens if There Is a Breach of Contract?

While some agreements specify how to deal with a breach of contract, others do not. If a breach is not included in your contract, then you—i.e., the injured party—can:

  1. Send a demand letter to the breaching party
  2. Try to settle the dispute with the other party directly, i.e., out of court
  3. Start a breach of contract lawsuit
  4. Claim damages
  5. Seek other remedies

Breach of Contract Law

You could go to court if your claim has the following breach of contract elements:

  • Existence of a valid contract—A valid contract must include:
    • Offer
    • Acceptance
    • Consideration
  • Evidence of the breaching party’s failure to perform—You need to show that the breaching party—also called the defendant in court—has failed to perform their obligation(s)
  • Proof of the plaintiff’s performance—You—as the injured party—must show that you have:
    • Met all the contract requirements
    • Suffered losses or harm in a certain way or amount
    • Notified the defendant that they are in breach of contract

Forms of Breach of Contract

Here are some common types of contract breaches:

Forms of Breach of ContractDetails
Minor breachA minor—also called partial and immaterial—breach of contract occurs if you do not get the agreed-upon goods or services by the due date (i.e., the breaching party delivers them late)
Material breachA material breach is a failure to perform the contract that:

  • Is significant enough to destroy the contract
  • Defeats the purpose of creating the agreement in the first place
Anticipatory breachThis type of contract breach happens when one party indicates or says in advance that they will not meet their obligations under the terms of the contract
Actual breachAn actual breach of contract occurs when one contractual party refuses to fulfill contractual terms and perform their obligations in full

Reasons for a Breach of Contract

If you decide to sue the breaching party, you should know that they could try to:

  • Prove they have not breached the contract
  • Offer a reason why the breach should be excused

Here is a list of common breach of contract defenses:

  1. Fraud—The defendant claims the contract is not valid because you have:
    1. Not disclosed something important
    2. Made a false statement about a significant fact
  2. Duress—A judge will deem a contract invalid if one contractual party has compelled the other one to enter into a contract by using threats or physical force
  3. Undue influence—If the defendant uses this type of defense, they claim the plaintiff has used a power of advantage over the defendant to force them to sign the agreement
  4. Mistake—The contract could be found invalid if the defendant can prove that both contractual parties have committed an error about the subject matter
  5. Statute of limitations—Most cases have precise time limits and can be filed by a certain deadline. If that time has passed—i.e., the statute of limitations has expired—a court might not accept your case. Keep in mind that the statute of limitations varies by state

Try To Settle the Dispute Before Suing for Breach of Contract

Keep in mind that resolving a problem outside court could be the least expensive and time-consuming option.

To settle a dispute outside of court, you should:

  1. Draft a breach of contract letterSign up for DoNotPay to create your letter fast
  2. Offer a solution and new deadline for the breaching party to fulfill their contractual obligations
  3. Take the necessary additional steps in accordance with the other party’s response or lack of it

Is There an Easier Way to Settle a Breach of Contract Dispute?

There is no need to:

  • Hire a pricey lawyer to draw up a demand letter for you
  • Inspect numerous demand letter templates only to find them unsuitable for your specific case

Our AI-powered app keeps track of relevant state laws and can use that knowledge to create a demand letter tailored to your needs in a matter of minutes.

Subscribe to DoNoPay and:

  1. Find the Client Breach of Contract feature
  2. Provide data about your agreement, including:
    1. The name of your client
    2. The terms of your contract
    3. Due date of payment
    4. The owed amount
  3. Enter the final due date for the payment before taking legal action

DoNotPay will automatically draft a demand letter using the provided information. Once we generate your letter, you can print it, send it to the breaching party, and wait for their response.

In case the other party sends an unfavorable response or does not reply at all, DoNotPay can help you sue them in small claims court.

If you would like to get familiar with breach of contract regulations in different U.S. states, you should take a look at the following table:

ColoradoNew YorkIllinois
VirginiaNew JerseyOhio
South CarolinaNorth CarolinaFlorida

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Breach of Contract — Frequently Asked Questions

What are the consequences of breaching a contract?

When a breach of contract occurs, the aggrieved party is entitled to take legal action and sue for damages in small claims court. The easier method is to use DoNotPay's "Sue Now" product, which allows you to sue anyone at the press of a button.

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