What Is a Breach of Contract and What Action Can I Take for It?

December 19, 2016, By Slater Heelis

What is a breach of contract?

A breach of contract is a legal cause of action in which one or more parties have not honoured one or more of the clauses agreed upon in a contract. A breach of contract can lead to the contract completely breaking down and possible legal action, depending on the severity of the breach.

Different types of contract breach

There are three main types of contract breach. These are: minor, material and anticipatory.

  • Minor breach of contract: this is also referred to as a partial breach and is a small breach of the terms of the contract which doesn’t stop the rest of the contract being fulfilled. An example of a minor breach of contract would be a builder substituting agreed upon materials with others of his choosing which perform the job to the same level. Even though the substitute materials perform the job to the level required the builder would still be liable for a minor breach of contract should this occur, as he has gone against the agreed-upon terms written in the contract.
  • Material breach of contract: a material breach is a breach of contract which negatively effects the outcome of the work and can be grounds for cancelling the contract. If the aforementioned builder had substituted the agreed upon materials for materials of a much lower quality, thereby reducing the quality of the finished product, it would be classified as a material breach of contract.
  • Anticipatory breach of contract: Slightly different to the other two breaches in that the breach doesn’t have to have occurred yet. An anticipatory breach of contract is when one of the parties makes it known in advance they will not be able to carry out the work or won’t be able to meet deadlines specified in the contract. For example, if your supplier has agreed to deliver new stock on 1st March but contacts you in February to inform you they will not be able to deliver the products until 15th March you would immediately be able to sue for an anticipatory breach of contract, without having to wait until the breach has occurred.

What legal action can I take for a breach of contract?

The course of action you can take for a breach of contract depends on the nature of the breach in question. If the breach was minor you can sure the party breaching the contract for damages incurred as a result of that breach but the rest of the contract is still valid, with both parties obligated to fulfil their agreements.

A material or anticipatory breach of contract allow the victim to cancel the contract and sue the offending party for damages caused by the breach.

How can I prove a breach of contract?

In order to prove a breach of contract has occurred, the judge will first need to establish that a legally binding contract exists, making it vital for you to keep all records of your contractual agreements signed by both parties.

If the contract is verbal you will need to prove to the judge that the agreement existed and outline what the terms and conditions of the agreement were.

Once the judge is satisfied the contract existed and what the terms were, you will need to show evidence of the breach and the damages caused as a direct result of the breach. For example, if you are alleging that your supplier is in breach of contract for delivering items late you will need to show evidence of the agreed delivery date and the date when the supplies were delivered.