Contract disputes can wreak havoc on a business which is why it is important to be familiar with them and what can be done when businesses end up facing them. It is helpful to be familiar with the elements of a contract and the remedies when one has been breached.
What is a contract?
A business contract creates obligations between the parties and also creates rights between the parties to the contract. When one of the parties fails to perform its legal obligations under the contract, it is referred to as a breach of contract. Contract breaches fall into certain categories considered material and immaterial breaches which can impact the remedies available. A breach of contract can occur when one party fails to perform on time, does not perform in accordance with the terms of the agreement or does not perform at all.
What are the remedies for contract breach?
A breach of contract can lead to business litigation and the parties may wish to seek to enforce the contract terms or may seek to recover financial compensation for the financial harm caused by the breach of contract. This depends on the the nature of the alleged breach, the needs of the parties and the goals of the parties. Specific remedies can include monetary damages, specific performance of the contract or cancellation of the contract and restitution.
In circumstances of contract disputes, it is important for the parties to be informed of their rights and know about the legal options available. That knowledge can help them navigate their way out of contract breach.