When Promises Are Broken: Understanding and Responding to Breach of Contract
Ruslan Ughrelidze
Solicitor Advocate and Managing Director at LawLex Solicitors | Higher Rights of Audience (Civil)
a. The Existence of a Contract
b. That the Contract Was Breached
c. Loss Was Suffered as a Direct Consequence of the Breach of Contract
4. What are the Legal Remedies for Breach of Contract?
5. Should I Sue for Breach of Contract?
6. How to Avoid a breach of contract?
7. Legal Help
8. Actions to take
1 . What is a contract?
A contract is a legally binding promise or agreement between two or more parties. The promise can be made in writing or implied, which means it was communicated orally or by conduct. The contract arises when one party offers something, and the other accepts it. Both parties must intend to be bound by the terms of the agreement. A legally binding contract must have three elements: an agreement, intention to create legal relations, and consideration. Consideration is what gives value and weight to the contract.
2. What Constitutes a Breach of Contract?
A breach of contract happens when one party fails to fulfil an obligation or breaks the 'Terms and Conditions' as set out in the agreement. This can happen in various ways, such as when one party fails to pay for goods or services provided by another party or fails to provide those goods and services to an acceptable standard.
3. How Do I Sue Someone for Breach of Contract?
To sue someone for a breach of contract, you must first overcome a series of legal hurdles to prove the breach of contract.
a. The Existence of a Contract
The first hurdle in proving a breach of contract is to show that a legally binding agreement existed. Having no written evidence of the agreement makes it tricky to show conclusively that one existed. To protect your rights and interests, it is always important to ensure that any contract you enter into is recorded in writing.
b. That the Contract Was Breached
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Once you have shown that a legally binding contract existed, the next obstacle is to prove that an agreement has subsequently been broken. There must be clear evidence of what the other party's obligations were under the agreement, for example, the Terms and Conditions, and proof that those obligations were not performed or not performed well.
c. Loss Was Suffered was a Direct Consequence of the Breach of Contract
The third and final hurdle in proving a breach of contract is showing that you suffered a loss as a direct result of the breach. Any loss you have suffered must have been a direct consequence of the breach of contract. It is important to bear in mind that, even if you manage to convince the Court that you have suffered a loss as a direct result of a breach of contract, assessing and then quantifying those losses can be a complex and difficult task.
4. What are the Legal Remedies for Breach of Contract?
If you manage to overcome the hurdles as set out above, you may be entitled to receive monetary damages for the breach of contract. The Court may also award alternative remedies, such as an injunction or an order of specific performance. An injunction is where the party in breach must either remedy the breach of contract or refrain from causing further damage. An order of specific performance requires the party in breach to fulfil a particular term of the contract, which they previously failed to do.
5. Should I Sue for Breach of Contract?
Before launching into a claim for breach of contract, it is important to assess the merits of your claim, evaluate how much it is worth, and consider whether pursuing a claim on principle is a reasonable and cost-effective response. Litigation can often be expensive, distressing, and time-consuming and may end up costing you more than you lost as a result of the breach of contract. It is also important to consider alternative methods of resolving the dispute, such as mediation or arbitration, which can be faster and less expensive than going to court.
6. How to Avoid a breach of contract?
To avoid a breach of contract, it's important to ensure that all parties involved understand the terms and conditions of the agreement before signing it. This includes discussing any unclear or ambiguous language, ensuring that all parties are capable of fulfilling their obligations and establishing a clear plan for handling any potential disputes that may arise.
7. Legal Help
In the event that a breach of contract does occur, it's important to seek legal advice as soon as possible. Depending on the nature and severity of the breach, there may be several legal remedies available, such as damages or specific performance. A qualified solicitor can help you assess your options and take the appropriate course of action to protect your interests.
Remember, a contract is a legally binding agreement, and failing to fulfil your obligations under the agreement can have serious consequences. By taking the time to fully understand the terms of the contract and working together to establish a clear plan for fulfilling obligations, all parties can minimize the risk of a breach and protect their interests.
8. What to do next
It's important to note that seeking legal advice is not only necessary when a dispute arises but also when you are negotiating a contract. Consulting a solicitor advocate can help you identify potential issues and negotiate favourable terms that protect your interests. By having a legal expert review and advise you on the terms of the contract before signing, you can ensure that the agreement accurately reflects your intentions and expectations. This can ultimately save you time and money down the road by avoiding future disputes and costly litigation. So, whether you're entering into a new agreement or dealing with a breach of contract, don't hesitate to contact me, your solicitor advocate, to discuss the details and protect your legal rights.