Daily Law Group
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What to do after a breach of contract

In the business world, you hope that every contract you execute is followed down to the finest of details. Unfortunately, this doesn't always happen. Even if you live up to your end of the bargain, there's always the chance that the other party will attempt to breach the contract for one reason or another.

There are many things that can result in a breach of contract, including but not limited to:

  • If one party fails to fulfill its obligations on time
  • If one party does not provide products or services based on the terms of the agreement
  • If one party fails to make payment for any reason

What should you do next?

When a breach of contract occurs, the first thing you should do is reach out to the other party for more information on what went wrong. It may be awkward, but a simple conversation can help you get the relationship back on track.

If you're unable to resolve the dispute on your own, filing a lawsuit may be your only option. Generally speaking, there are three remedies for a breach of contract:

  • Cancellation and restitution
  • Specific performance
  • Damages

Cancellation is exactly what it sounds like, with the non-breaching party canceling the contract and filing a lawsuit for restitution.

Specific performance is the breaching party's court-ordered performance of duty, as outlined in the contract. This typically comes into play if the issue at hand is unique or rare.

The payment of damages is the most common solution for a breach of contract. You need to decide what type of damages to seek, including:

  • Compensatory damages
  • Nominal damages
  • Punitive damages
  • Liquidated damages

You sign a contract before any business deal with the idea that it will outline the responsibilities and rights of both parties. Just the same, the contract includes language regarding what happens in the event of a breach.

Despite your best efforts to always make things work out, there may come a point when a breach of contract occurs. It can be frustrating, stressful and time-consuming, but understanding your legal rights will go a long way in helping you find a resolution that puts your relationship in the past once and for all.

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