Breach Of Contract.
Apr 13, 2019 • 42 views
Well, toknow exactly what breach of contract is, we must know about the “ Indian Contract Act, 1872 . According to Section 2(h) of the Act, 1872,A Contract means an agreement which is enforceable by law . In case of Contract each party is legally bound by the promise made by him. The most common way of making a contract is through an agreement. The two parties may agree to something through mutual negotiations .There are certain essentials for a valid Contract therefore are as under –
An agreement between the two parties. An agreement is the result of a proposal or an offer by one party followed by its acceptance by the other.
Agreement should be between the parties the parties who are competent to contract.
There should be lawful consideration and lawful object in respect of that agreement.
There should be free consent of the parties, when they enter into the agreement .
The agreement must not be one, which has been expressly declared to be void.
When one party makes an offer and the other accepts the same, there arises an agreement, which may be enforceable by law and when one party is unable to fulfill its duty then it is Breach of Contract.
Breach of Contract, states it is a failure to fulfill duties under the contract terms . So this article discusses Contract formation, oral and written Contracts. Whena Contract has been breached. The remedies for its breach is available. There are four types of Contract. breaches : ‘ Anticipatory, Actual, Minor and Material . Most breaches of Contract fall into one of two categories. They can either be considered actual breaches or anticipatory breaches. An actual breach occurs when ‘one person refuses to fulfill his or her side of the bargain on the due date or performs incompletely ’. Anticipatory breach occurs. ‘when one party announces , in advance of the due date for performance, that he intends not to fulfill his side of the bargain . They can waste both money and time. Andcertainly lead to frustration for everyone involved.. A breach is likely material ‘if one party ends up with something significantly. Different than what was specified in the Contract.’ For eg: if you contact with a web designer to build a new site for home café. But end up with a blog about bagels that doesn’t even mention your place , the breach is probably material .In most cases, a material breach means the non- breaching party is no longer required to perform his or her end of the deal and has a right to remedies.
A Minor breach is, sometimes called a partial breach. can be a big deal, too . In many cases, a minor breach means that one party failed to perform some part of the contract even through the specified item or service was ultimately delivered. Consider the café website contract. If the finished product met all the client’s demands but was completed a day after it was requested. The breach might be considered minor. Unless the initial contract terms specifically mentioned that ‘time is of the essence’ or that the website was under a tight deadline areasonable delay from the web designer would only be considered a minor breach. With reference to the case, ‘ SUMPTER V HEDGES (1898) : The claimant agreed to build two horses and stables for the defendant . It was agreed that $565 would be payable on completion. The claimant commenced performance and then ran out of money and was unable to complete. He had performed just over half of the contract . The defendant completed the work himself. The claimant sought to cover $333 representing the value of the work he had completed .He argued that in completing the workhimself, the defendant gad there by accepted partial performance and prevented the claimant from completing the contract. In order to win a breach of contract case, you will need to establish that :
1) Existence of an Enforceable contract . For business Contract to be valid, four additional things will have to be proved .
2) Your performance of the Contract. You must prove that you held up your endof deal.
3) The defendant’s Breach.
4) Damages of the Breach.
Likewise, in case STARUPV MACDONALD (1843) : A Contract stated that 10 tons of oil were ti be delivered to the defendant within the last 14 days of march. The claimant delivered the oil at 8:30pm Saturday March 31st . The defendant refused to accept the delivery because of the lateness of the hour.
There are many remedies available for the breach of Contract or damages can be awarded in a breach of contract they are as follows :
1)Compensatory Damages – This is the most common remedy for breach of Contract. Usually, when compensatory damages are ordered, the breaching party must pay the Other party what was promised elsewhere in the Contract. For instance, pretend that you hired a caterer for $1000, but they were unable to dowhat they said. You had to find another caterer , but the cost was $1500 . If the court thinks it reasonable, the original caterer may have to pay you $1500 in compensatory damages.
2) Restitution – When restitution is ordered, the breaching party is required to pay the other party back. In the above example,, the court would order the original caterer to pay you the $1000 that you paid her to cater your party .
3) Liquidated Damages – Agreed- upon damages that the parties say they will pay in the event of a Contract breach.
4) Nominal Damages- Awarded when no party suffered harm after a breach of Contract.
5) Quantum Damages- Awarded to a party as payment for any performance prior to the other party’s breach of contract. For instance, if a house cleaner cleaned part of a house, and that person decided she didn’t want him to finish cleaning the resr of the house, the court could order the homeowner to pay for the work completed.
6) Remedies in Equity- A remedy in equity is when the court orders a party to do something, also known as injunctive relief. This could be in the form of a cancellation of the Contract, which releases the parties from the agreement.It could also be in the form of a specific performance, which forces the breaching party to deliver the goods or perform the service n the contract .
7) Punitive Damages- Reserved for cases in which a party acted in a morally reprehensive way, punitive damages are intended to punish the offering party.
Other remedies available are also available for the breach of Contract they are asfollows :
1) Specific Performance – It requires the breaching party to perform their part of the contract .
2) Contract Rescission – It would cancel the contrac.. In this case, it would be possible to form a new contract that suits both parties.
3) Contract Reformation – The Contract is rewritten so that the intentions of both the parties are well represented and expressed.
If anyone has questions regarding the damages available for breach of contract, we should contact a local business lawyer. An experienced attorney will review your Contract and advise you of your best course of action..
The most famous case of‘breach of contract’ case is the Pepsi Points Case. Pepsi launched a humorous commercial offering to redeem 7,000,000 Pepsi points for an AV-8 Harrier jet, II jumpjet. Wanting to get this hands on a Harrier jet, a 21 –year- old business student sent Pepsi a 7,00,000 check ( as permitted by the contest rules) and tried to order a Harrier jet. Pepsi returned the check, explaining that the commercial was a joke.
To sue someone for the breach of contract following steps have to be followed which are as follows:
1) Determine whether you have a valid contract.
2) Determine whether a breach of contract has occurred
3) Determine whether you are within the statute of limitations
4) Determine if the breach is material and caused damages.
5) Keep track of all damages.
6) Determine whether you can go to small claims court
7) Choose the right court.
8) Research state laws on serving the other party.
9) Obrain a complaint form.
9) File your complaint.
10) Await a summons.
11) Serve the other party.
12) Prepare for your hearing.
13) Attend your hearing.
Hence, breach of contract is a failure to fulfill the duties under the contract terms. And various remedies are available for the breach of contract.
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