Contracts are designed to bind the parties to an agreement to the mutual promises they’ve made to one another. When contracts are carefully negotiated, executed – and followed – all parties receive the benefit of the bargain. But there are times in which a party may decide to stop fulfilling its obligations under the agreement. If this happens, the other parties may have a breach of contract claim.
If another party has breached your contract, or you’ve been accused of doing the same, retaining skilled legal counsel will be essential to protecting your rights and interests. Count on SederLaw to advocate for you.
Elements of a Breach of Contract Lawsuit
In order to prove that a party breached a contract in Massachusetts, the following elements must be proven:
The existence of a valid contract: The starting point of a breach of contract lawsuit is proving there was a valid agreement between the parties. Some defendants may deny that there was a contract to violate in the first place. These are the requirements for a valid, enforceable contract:
- Offer. The offeror (the person making the offer) must communicate certain terms to the offeree (the person receiving the offer). A reasonable person must be able to view the offeror’s communication as something the offeree could accept to form an agreement.
- Acceptance. This is the communication of an agreement with the offeror’s terms. If a person receives an offer, and instead of agreeing with it proposes alternative terms, then there is no agreement. In this instance, there would be a counter-offer, which then may be accepted, rejected, or countered by the other party.
- Consideration. Assuming the parties arrive at agreed-upon terms, there must also be a consideration. This is an exchange of something of value between the parties. If one party agrees to purchase a vehicle from another, the price paid would be the consideration. In a services contract, consideration consists of one party agreeing to bear an obligation to perform services that the person isn’t otherwise obligated to perform.
The plaintiff performed its obligations under the contract: It must be clear that the party bringing suit either performed or was willing and able to perform what it agreed to under the contract. In a breach of contract lawsuit, the plaintiff must make its performance or intent to perform clear.
The defendant failed to perform its duties under the contract: This is the heart of a breach of contract case and is often the most hotly disputed issue between the parties. There are several ways that a party may be in breach, but also various defenses to an alleged breach (see below).
The breach caused the plaintiff to incur damages: The plaintiff will generally demand some sort of monetary compensation pursuant to the breach of contract, such as compensatory or liquidated damages. Ask an attorney about the possible monetary damages you may be able to receive as a result of the other party’s breach.
Different Ways to Breach a Contract
Because every contract is different, there are numerous ways a party may decide to disregard its obligations or go against the terms of the agreement. Here are some examples:
- Failure to pay for goods or services rendered
- Failure to pay the correct amount for goods or services
- Failure to provide the correct type or amount of a good or service
- Failure to provide goods or services in a timely manner
- Breaching express or implied warranties
- Doing something expressly forbidden by the contract, such as competing against a former employer
The plaintiff could seek several remedies if it can prove the defendant failed to live up to the terms of the agreement. Those remedies include:
Money damages. As discussed above, there are several forms of this. They may be designed to place the party in the position it would have been in had the terms of the contract been followed. Or these damages could provide restitution to a party that spent money in reliance on contract terms the other party ignored. Another category is liquidated damages, which are used where actual damages may be difficult or impossible to prove.
Reformation. Contract reformation occurs when changes are made to help ensure compliance with the terms of the agreement. It is designed to restate the terms of a contract when the written agreement does not reflect the intent of the parties.
Rescission. Rescission means cancellation of the contract. It requires the return of any money exchanged so the parties can be placed in a position as if the contract terms were never performed. Another way of describing rescission is the voiding of a contract.
Specific performance. A party may demand that the breaching party comply with the terms of the contract. That means asking the court to order the breaching party to do what it agreed to do. Specific performance is often a remedy for breaches of real estate purchase contracts since the property is unique and financial compensation may not suffice to protect the rights and interests of the non-breaching party.
Possible Defenses to a Breach of Contract Lawsuit
The defendant is not without ways to defend against the plaintiff’s breach of contract allegations. These are some potential defenses the defendant may rely upon:
- The absence of a valid contract. Since this is a prerequisite to bring a breach of contract action, if there’s no actual agreement then this gives the defendant an argument.
- Statute of limitations. Plaintiffs only have so much time to bring a breach of contract claim. The deadline to do so is known as the statute of limitations, and it varies by contract.
- Statute of frauds. Certain contracts must be in writing to be enforceable. They include agreements to purchase land and contracts that won’t be performed in less than a year.
- Waiver. The defendant may be able to prove that the plaintiff acted in a manner that constitutes acceptance of the breach, which effectively waives the plaintiff’s objection to the breach.
- Impossibility. This refers to a situation in which a fundamental assumption on which the contract was based no longer exists, and the absence of it was not caused by either party. For example, a painter is hired to paint a house. During a major storm, the house is destroyed and the painter can’t do the job.
- Illegality. If the contract is illegal, it won’t be enforced. Anything that requires a party to break the law to perform the contract will not be upheld by a court.
- Incapacity. Suppose a party to the contract was mentally deficient or underage at the time of entering into the agreement. The contract won’t be enforced against that party.
Contact Our Worcester Breach of Contract Attorney
Whether you are the party that allegedly violated the terms of the contract, or you are making this accusation against another party, having knowledgeable legal representation is key. Although contract breaches often lead to litigation, there are also out-of-court solutions that can help the parties sort out their disputes and get back to working with each other. Connect with SederLaw today to learn more about your legal options.