The Scoop on Texas Breach of Contract Law

Breach of Contract The Scoop on Texas Breach of Contract Law

Texas Breach of Contract Law Specifics

It is not easy to decide whether to take legal action against someone in breach of contract. You need to take all matters into account before choosing the most suitable option for your case.

To get a better understanding of what your rights and obligations are, you need to get familiar with Texas breach of contract law. This article provides the information that will help you make up your mind about how to proceed.

Elements of Breach of Contract in Texas

A breach of contract happens when one contractual party does not uphold the contractual terms.

Under Texas law, if you decide to sue the other party for breach and seek legal remedies, you will need to prove the following elements:

  • The existence of a valid oral or written contract—A valid agreement contains a(n):
    • Offer
    • Consideration
    • Acceptance of the offer
  • You—i.e., the plaintiff—have performed your obligations under the contract
  • The breaching party—i.e., the defendant—has failed to fulfill their commitments
  • You have suffered damages because of the contract breach

Texas Breach of Contract—What Damages You Are Entitled To

To assess the situation and determine remedies, a judge will:

  1. Examine the terms of the contract—Most agreements include precise penalties for breach of contract instances
  2. Award damages based on the situation—If the contract does not specify penalties, a judge will decide what damages you are entitled to

What Remedies To Expect

In the following table, you can find a list of potential remedies and damages a court might award you:

Potential RemediesExplanation
Specific performanceIf the court awards this type of remedy, they require the defendant to perform obligations under the contract. Specific performance is common for real estate contracts
Liquidated damagesLiquidated damages are awarded in the amount of the loss you have suffered as a result of the breach
Loss of use, time, or credit reputationThis type of remedy is awarded to compensate for the time you have:

  • Lost because the breaching party has not fulfilled the contractual terms on time
  • Spent fixing the resulting damages

A court could also award damages to compensate for the loss of credit reputation that happened due to the breach of contract

ReimbursementYou might receive reimbursement for any expenses you have incurred while:

  • Performing your obligations under the contract
  • Trying to repair harm and injury you have experienced due to the (material) breach
Consequential and incidental damagesYou can get these damages to compensate foreseeable losses
RescissionIf a court decides to terminate the agreement, neither party needs to perform agreed-upon obligations any longer
RestitutionIn case of this type of remedy, both parties must return all gains they have made from the contract

Keep in mind that the breaching party could raise defenses to attempt to prove they have fulfilled the terms of the contract.

Texas Breach of Contract Law Allows Out-of-Court Settlements

Since litigation is usually pricey, complicated, and time-consuming, you could try to negotiate a settlement with the breaching party outside of court first.

Creating a breach of contract demand letter can be an efficient way to resolve the dispute without involving judges and expensive lawyers. Your letter should include the following:

  • Facts and terms of the contract
  • A reminder that the other party has not fulfilled the agreed-upon commitments
  • A solution to the pending problem, e.g., a new deadline for the delivery of services or goods

A good demand letter should specify all the necessary details that could serve as a clear indication for the other party that:

  • They need to honor their end of the deal
  • You:
    • Are not willing to give up on the agreed services or goods
    • Will sue them for any incurred expenses and losses

Register for DoNotPay to create a watertight Texas demand letter that will:

  1. Cover all the necessary information regarding your case
  2. Comply with state laws

Let DoNotPay Take Care of Your Demand Letter

Our AI-powered app keeps track of all changes to relevant state laws to help you prepare an airtight demand letter without you having to:

  • Hire a costly attorney
  • Visit a collection agency that can take up to 50% of the collected damages
  • Adjust an online template to suit your specific circumstances

To get a demand letter customized to your case, subscribe to DoNotPay and take these steps:

  1. Use our Client Breach of Contract product
  2. Answer the chatbot’s questions about the contract and the breaching party
  3. Provide a new deadline for payment or delivery
  4. Outline the performed services
  5. Upload any evidence to back up what you have stated

If the other party does not respond to your letter or is not open to negotiations, DoNotPay can help you sue them in small claims court.

Texas Breach of Contract Statute of Limitations

If you are thinking about taking legal action against the breaching party, you need to determine what the statute of limitations is.

In Texas, you can file a claim for a breach of contract within four years from the date when the breach occurred, but keep in mind that there are exceptions. Check out the following table for details:

Exceptions to the Statute of Limitations in TexasSpecifics
Discovery ruleThe statute of limitations for a legal claim begins once you:

  • Have found out about the injury caused by the breach of contract
  • Should have discovered the resulting loss in the exercise of reasonable care
Fraudulent concealmentThe statute of limitations can be tolled—i.e., legally suspended—if:

  1. The other party under the contract hid the breach from you
  2. You were not aware of the breach when it happened

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