Business disputes often involve issues with contracts. When companies negotiate contracts, they typically expect that the other party subject to the agreement should uphold the terms they negotiated. The main purpose of a contract is to provide clarity regarding the agreement between the parties to make it as enforceable as possible.
Despite having a written agreement, violations or breaches of the contract could still be an issue. Contract breaches can lead to operational setbacks and financial losses. If the other party won’t resolve the matter quickly, it is sometimes necessary to take a contract dispute to court.
What potential solutions are available in a breach of contract lawsuit?
The termination of the contract
When one party flagrantly violates an agreement, the other party to the contract may no longer want to do business together. Contract breaches can undermine the professional trust often necessary to work with another organization or individual. Issues ranging from non-payment to substandard performance of services may lead to one party seeking to end future contractual obligations to another because they no longer view doing business with the other party as a beneficial arrangement. The courts can sometimes terminate future obligations after a significant contract violation.
Financial compensation for damages
A contract violation can cause numerous financial expenses. A breach by one party might lead to the other party being unable to fulfill obligations to a client or customer. Failure to deliver goods or provide services might affect efficiency at a company and could cause significant financial losses. Provided that a company can prove there were economic expenses triggered by a contract breach, a judge may award them damages in consideration of the harm caused by the incident.
An order of specific performance
Civil judges also potentially have the authority to enforce a contract after a breach occurs. A judge can issue an order of specific performance compelling one party to deliver goods and materials as agreed upon in the original contract. A judge might also require that one party provide services to the other. Ordering the completion of an unfinished project is possible. A judge could even order one party to redo work already performed because it did not meet certain standards established in the original contract.
Any of these solutions can diminish the negative impact a contract breach has on a business. Seeking the right support from the courts can make a major difference for a company impacted by the contractual failings of another party.