What is Breach of Contract?

Contracts are legal agreements between two or more parties that outline the legal obligations and rights of each party. Every person or entity that enters into a contract has the right to expect the others named within the agreement to live up to their part of the contract. Each party also has a certain duty to others named in the contract. Any time one party does not fulfill their obligations outlined in the agreement, they are considered to be in breach of contract. Any party that has sustained harm or loss due to someone else’s breach of contract can file a lawsuit to seek damages. First though, they must prove the other party is indeed in breach of contract. Read on if you’re still wondering, “Well, what is breach of contract?”

Breach of Contract Defined in California Law

In its simplest terms, a breach of contract occurs when a named party in the agreement refuses or fails to uphold their end of the contract. For example, a business owner may enter into a contract with a vendor. The contract may stipulate that the vendor will provide certain products to the business, and that the business will make timely payments for those products.

Regardless of the terms of the contract, the parties named within them have a legal obligation to fulfill their duties under the agreement. If one party fails to meet these legal obligations, they are in breach of contract. This remains true even when the party that breached the contract did not fully read the agreement.

When one party does not fulfill the obligations within a contract, there are sometimes defenses available for the breach. In the above example, if the business burned down and was unable to operate, receive supplies, or pay vendors, this could serve as a breach of contract. Most defenses in breach of contract claims are affirmative, meaning the defendant does not disagree that they breached the contract. Instead, they simply must show that they had a valid reason for the breach.

Remedies Available for Breach of Contract

Breaches of contract can hurt every other party named within the agreement. California law outlines many remedies wronged parties can pursue when another person or entity has breached a contract. These include:

Refusal to uphold contractual obligations: When one party has breached a contract, it gives all other parties the right to refuse to uphold their own obligations under the contract. Using the above example, if the business did not burn down and the owner simply refused to pay the vendor, the vendor could in turn refuse to continue providing products to the business.
Compelling to take specific action: A breach of contract lawsuit can force the breaching party to fulfill their obligations. Staying with the above example, a vendor could file a lawsuit against the business owner and force them to pay for products already provided. If the contract had a specific end date, the vendor may even attempt to compel the business owner to provide payment until the date stated in the contract, even if the business owner no longer wanted the products.
Recovering monetary damages: Like many other types of lawsuits, when one party is proven to be in breach of contract, the non-breaching party can seek monetary damages for any losses they sustained due to the failure of another party to meet their legal obligations.

The remedies pursued by a non-breaching party will vary, depending on the specific facts of the case. An experienced Santa Monica business attorney can identify the remedies available, and recommend the most appropriate course of action to take.

Proving Breach of Contract

Like any other legal case, plaintiffs must show that the defendant, or breaching party, did not fulfill their legal obligations. The four elements of proof in a breach of contract case include:

A contract was in place: It is important that all contracts are in writing, as a written contract can easily prove there was an agreement in place. While California law generally allows for oral contracts, these contracts make it much more challenging to prove there was a contract between the parties.
The plaintiff met their legal duty: If one party does not meet their legal obligations outlined in the contract, there is a case for any other named person in the contract to refuse to meet theirs, as well. As such, plaintiffs must provide compelling evidence to show that their legal obligations were met.
The defendant did not meet their legal duty: Once it is proven that the plaintiff met their legal obligations, they then have the burden of proof to show that the defendant did not. Evidence could include unpaid invoices, disrepair to equipment or other property, and witness testimony.
The plaintiff suffered losses as a result of the breach: Without losses or harm sustained by one party as a result of the breach of contract, there is no legal action. Lawsuits and other remedies rely on one party sustaining harm due to the breach of contract and without it, there is often no breach of contract case.

A breach of contract may seem obvious to the plaintiff, but these cases are very difficult to prove. A Santa Monica business litigation lawyer can review a case when someone believes they have suffered from a breach of contract. An attorney will examine the facts and build a strong body of evidence that demonstrates the claim and corroborates the statements made within the claim.