Contracts are legally binding agreements. When one party fails to fulfill one or more terms outlined in the contract, this is known as a breach of contract. You can take legal action to recover your damages.
Types of Breach of Contract Claims
There are four different types of breach of contract:
When one party violates a portion of the contract, this is considered a minor breach or partial breach. An example of a partial breach might be completing a construction job on time but using inferior materials.
Also known as a total breach, this means one party failed to perform their duties to such an extent that the agreement is considered completely broken. An example of a material breach would be when one party paid in full for services that were never performed or goods that were never delivered by the other party.
Similar to a material breach, a fundamental breach occurs when one party fails to complete an essential obligation, so the other party can’t complete their assigned responsibilities according to the terms of the contract. The non-breaching party can then cancel the contract completely. A fundamental breach might occur when one party is supposed to make a product and the other is supposed to provide delivery services. If the product is never made, the party providing delivery services can’t live up to their portion of the contract.
This type of breach of contract claim happens when one party knows the other party won’t be able to fulfill the terms of the contract. Often, this relates to projects that haven’t been started early enough to be fulfilled by the agreed-upon timeframe.
When you have a valid breach of contract claim, you can generally seek compensatory damages. This refers to compensation for what was promised under the terms of the contract—such as the value of a specific product or service. Other types of damages that may be available include restitution, punitive damages, and specific performance.
Meeting with an experienced business law attorney is the best way to determine if you have a valid breach of contract claim and what type of damages you may be entitled to receive.
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