When you’ve signed a contract with another party, it’s a legally binding agreement that creates an obligation to do something. In some cases it is a service, in some cases, it is a sale, but in all cases, it involves one party making an offer to another and the other party agreeing to the terms of the offer. Both sides have an understanding of what is expected based on the terms that the contract includes: these terms may indicate a date when the terms are to be met, the compensation to be provided, the quality of materials to be used, and more. When one party to a contract fails to perform according to the obligations specified in the agreement, it is considered a breach of contract.

Several types of breaches can occur. They are:

  • Material or fundamental breach: This type of breach represents a significant departure from the terms of the contract. An example of a material breach would be if a business purchased a computer system for their office staff to be delivered on February 1st and to have certain specifications. If the system was not delivered until May 30th and it failed to meet the specifications of the original contract, that would represent a material breach because the delivery fell short of the agreed-to terms and may have deprived the company ordering it of their ability to do their work. A material breach can lead to both termination of the contract and damages being paid to the party that did not get what they were promised. They can also demand fulfillment of the contract.
  • Minor breach: A minor breach is a less significant failure to deliver what was promised within the contract. The party that did not get what they agreed to can still get substantial benefits from the agreement. In the example above, the computers might have been delivered a day or two late, or they may have met all of the specifications but might have been the wrong color. The non-breaching party might be entitled to remedies, but probably can’t cancel the contract.
  • Anticipatory breach: This type of breach occurs when one of the parties that agreed to a contract indicates through their words or actions that they are not going to fulfill their contractual obligation. Upon this happening, the non-breaching party can take legal action, either terminating the contract, demanding that the contract be fulfilled, or seeking damages for any harm that they suffered based on the non-fulfillment of the contract.

If you are struggling to resolve a contract dispute, it’s important to make sure that you understand your rights and have a knowledgeable advocate working on your behalf. For help, contact our experienced contract law attorneys today.