What Constitutes a Breach of Contract?
If any party in the contract fails to perform a contractual obligation within a stipulated time frame, a breach of contract has occurred.
Author: James Welch
13 December 2022
Under Australian corporate and business law, once parties enter a contract, they must abide by its terms and provisions. If any party in the contract fails to perform a contractual obligation within a stipulated time frame, a breach of contract has occurred. At Access Law Group, a business and dispute resolution lawyer from our team can help clients in Sydney, Camden and Wollongong navigate the complexities of contract law.
A breach of contract can occur via an express term of contract. This is where a party fails to do what a clause states must be done by the agreed time or within a reasonable time if no time frame is provided. For example, a supplier fails to deliver required goods to your business within the timeframe specifically stipulated in a contract you’ve both signed.
Partial or Minor Breach
This occurs where the terms of the contract have only been partially met. For example, a supplier fails to supply all the goods. A minor breach typically doesn’t lead to an immediate cancellation of the contract but obligates the breacher to remedy the situation.
A material breach of contract involves an essential element of the contract not being performed as agreed. For example, a supplier providing the wrong goods. The non-breaching parties have the right to seek a remedy or be compensated by the breaching parties. To be considered a material breach, the situation must have had a substantial or serious impact on the benefit one party expected to receive.
Anticipatory breaches arise when one party realises the other will not or does not intend to fulfil the terms of the contract before they are required to do so. For example, a supplier does not have the goods in stock that they agreed they would have supplied within a stipulated time frame.
Remedies for a Breach of Contract
You should contact our business and dispute resolution lawyers before you take action to enforce a contract – particularly if you are thinking of terminating the contract. Enforcing a contract incorrectly can expose you to a risk of a claim.
There are four main remedies for breach of contract in corporate and business law disputes that you can seek as the wronged party:
- Damages to compensate you for the loss suffered
- Court order requiring the breaching party to carry out their obligations
- Court order forbidding the party from breaching the contract
- Court order to terminate the contract and require the party who breached it to restore the wronged party in the position they were in before the contract was entered into
Ultimately, the type of remedy, its appropriateness and its availability depend on the specific terms of contract, type of breach and any relevant unique circumstances. A business and dispute resolution lawyer can advise you as to the best means of dealing with the problem.
Business Lawyer in Wollongong, Camden and Sydney
At Access Law Group, you can speak to a business and dispute resolution lawyer that specialises in contract law. For reliable legal services in Wollongong, Camden and Sydney, call us on 02 4220 7100 or contact us online.