Business litigation cases come in various forms. The way you handle these cases determine the eventual success or failure of your business. One of the most common cases includes breach of contract.
What Is a Breach of Contract?
Contracts are a normal way of life for any business. However, not all parties fulfill their end of the contract. The violation of agreed-upon terms and conditions of a binding contract is called a breach of contract. It could be anything from late payment on a sale of property to a more serious violation such as failure to deliver an asset.
Business contracts are binding for the two parties involved. This means that if violated, the contract holds weight in a court of law.
Handling a Breach of Contract
At times, the process of handling a breach of contract is incorporated in the terms of the contract. For example, the contract might state that the defaulter pays 10 percent more or a predetermined sum plus the missed payment in case of late payment. In such a case, it is easy to handle the issue.
If the consequences of the specific violation are not included in the contract, you can decide to settle the dispute in court or via arbitration, which often leads to formulation a new contract or legal action.
When Can a Breach of Contract Be Upheld in Court?
A contract may be breached in whole or in part. In order for any dispute to be upheld in a court of law, it must fulfill several requirements that include:
• The contract must be valid. Validity in this case means that it has all the essential elements of a contract. If any element is missing, then it cannot be heard by the court of law and there won’t be any lawsuit.
• You must prove beyond reasonable doubt that the defendant breached the contract.
• You have to show that you did everything you were supposed to do according to the contract. You cannot file a lawsuit if you have also failed to meet your contractual obligations.
• You must have notified the defendant of the breach of contract. It is better if you do this in writing than verbal.
A contract ends when both parties have fulfilled the contractual obligations. Showing that a valid contract existed is the first step towards filing a successful lawsuit.
Types of Contract Breaches
A breach of contract comes in two types. An actual breach of contract is whereby the other party refuses to fulfill his or her side of the bargain on the due date. On the other hand, an anticipatory breach of contract occurs when the other party announces an intention of not performing his or her side of the bargain before the due date.
According to Gilbert & Bourke, the only way to handle a breach of contract and any other business litigation case is to work with a qualified attorney who will help you with the litigation process.