The objective of contracts is to promote stability. If all parties to a contract understand entirely and agree to its terms, then the agreement should meet or exceed everyone’s expectations. But, there may be terrible consequences for all parties if one of the deal makers transforms into a deal breaker. If you think that your contract has been breached, contact a Tampa business attorney.
Breach of contract: Making and breaking deals
Whether it is for the sale of goods or the execution of a service, there are many scenarios or transactions where it is logical to have a contract in place. A contract helps the parties involved or a court of law in resolving issues that occur when unforeseen circumstances make a transaction challenging or impossible to take place. Typical contract forms include:
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Employment contracts
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Lease agreements
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Construction agreements
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Shareholder agreements
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Nondisclosure agreements
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Partnership agreements
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Intellectual property
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Financing agreements
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Sales-related contracts
Written versus spoken
Oral contracts are sometimes complicated to verify, even though they can be both written and spoken. It, therefore, makes sense to “get it in writing” in all situations. In addition, some contracts, including those related to marriage, paying off debts owed to third parties, and selling or exchanging land, need to be written down in order to be recognized by the law.
When is a contract considered breached?
A contract is considered breached when any of its terms and conditions are not met. For example, a contract breaches if a painter offers to paint a customer’s house in seven days, but the house is still unfinished after that period.
Material or non-material?
A contract breach may be material or non-material. Non-material breaches are minor in scope and have no impact on the essence of the contract. Imagine the following situation: Someone gets a contractor to install pipelines in a new home.
The contractor installs pipes that are exactly the same type and quality as those stated in the contract, but they were made by business B rather than company A. Since there has been little modification, this is seen as a non-material breach. On the other hand, there would be a major difference and an enormous breach if the contractor installed PVC piping when the contract mandated copper pipes.
Duty to mitigate damages
The non-breaching party must take appropriate action to try to minimize the damage, even though the breached party is likely to experience harm. This requirement, often known as the duty to mitigate, is a court expectation rather than an obligatory one. If the non-breaching party had attempted to stop the damage, the court may have been able to reduce the losses or damages they could have been entitled to.