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Remedies available when a contract is breached

Unfortunately, as most California business owners are aware, contracts are often breached in the course of engaging in transactions. When a breach occurs, it may be an immaterial one, which means it can easily be corrected, or a material one, which means it is so severe that the very terms of the contract have been violated. There are remedies available for either type of breach.

Most immaterial breaches can be resolved informally without necessitating litigation. Examples of immaterial breaches include such things as late deliveries. A possible solution is negotiating that the late company pay for any costs incurred by the receiving business caused by the delay. When a company instead commits a material breach, such as complete nonperformance of its duties under the contract, however, the only solution may be litigation.

Remedies granted in order to resolve serious contract breaches most often involve the award of damages. There are many types of damages, and in most cases, the damages may be very specific to rectify the harm caused. Compensatory damages may be ordered to help put the non-breaching party back into the position it would have been in but for the breach. Liquidated damages may be ordered if they were specifically called for in the contract itself. Judges may order specific performance, in which the breaching company is ordered to perform its duties called for in the contract. There are also several other types of damages and remedies available.

Whether a business has been accused of a material breach or believes another company is in breach of a contract, the business may want to get the help of legal counsel. A business law attorney may be able to help resolve the dispute without the need for potentially lengthy and expensive litigation.

Source: FindLaw, "Breach of Contract and Lawsuits", accessed on Feb. 4, 2015

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Contact Henry B. LaTorraca

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