Contracts are a crucial aspect of any business, as they set forth the obligations of the parties involved. However, despite careful drafting, unforeseen events such as financial problems, delays, and other unexpected circumstances can impede the execution of these agreements. When one party fails to fulfill their obligations under the contract, it is considered a breach of contract.
There are two types of breaches: material and immaterial. A material breach goes to the heart of the agreement, defeating its entire purpose. An example of this could be a seller who agreed to sell a specific house to a buyer but offers a different house instead on the day of closing. In contrast, an immaterial breach does not affect the primary purpose of the contract and involves the failure to fulfill a minor contractual duty.
If a breach of contract occurs, the aggrieved party has legal options available. To build a successful case, the plaintiff must prove that a contract existed, that it was broken, that they suffered a financial loss, and that the defendant was responsible for the loss. Additionally, the contract must be enforceable and follow a set formula for goods or services to be exchanged. However, even contracts that were never formally executed can be enforceable in certain circumstances.
To avoid breach of contract disputes, parties should take the time to carefully draft and review contracts before signing. Contracts may also have clauses that outline what constitutes a material breach and other pertinent provisions.
If a breach of contract does occur, there are several legal remedies available. The plaintiff may seek damages, such as restitution or return of any advance payments, or sue the other party to compel performance.
At Abir Cohen Treyzon Salo, LLP, our experienced Los Angeles business attorneys can provide effective legal guidance for breach of contract disputes. We serve clients throughout San Diego and Los Angeles, California, and offer free case evaluations. Contact us at 833-ACTS-LAW or fill out our online form today to schedule a consultation.