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What is a contract breach?

On Behalf of | Jul 6, 2023 | BUSINESS & COMMERCIAL LAW - Business Litigation

Contractual agreements are common among businesses and other parties. By ensuring that contracted parties are aware of their legal obligations, well-written contracts can be advantageous to all parties.

Contract breaches do happen and can be troublesome for all parties involved. What you should know about contract violations is this:

Minor breach

Anything that marginally violates a contract may be considered a minor breach. Usually, this sort of violation does not result in much damage but is still in violation of a contract.

A small breach, for instance, would occur if one of the parties neglected to send a shipment of wood by the deadline. Instead, the delivery was delayed by a day. Even though there may not have been any significant harm from this delay, it may still be seen as an issue.

Material breach

When a good or service was not provided or finished in accordance with the terms of a contract, it constitutes a material breach. Damages from this sort of breach may be severe.

Returning to the wood example, the non-breaching party checked the wood and found that they were rotted or warped, rendering them useless. Thus, the use of the wood resulted in sales losses for the non-breaching party.

Anticipatory breach

Frequently, breaches are identified right away. However, in rare situations, a party may be aware that a hired party would violate the terms of the agreement; this is known as an anticipatory breach. The non-breaching party may talk about how the possible breach is remedied before it happens.

Actual breach

Actual breaches are those that arise from a party’s outright failure to follow the terms of a contract. An actual breach is a blatant admission that the person with whom the contract was made will not or is unable to carry out their obligations.

Contract violations can occur in a variety of ways. Some breaches can happen as a result of unread contract clauses. By being aware of your legal choices and incorporating terms that specify what would happen in the event of a violation, you may be able to reduce contract breaches.