What To Do After the Other Party Breached Your Contract

Sometimes you enter into a business relationship that doesn’t work out as well as you hoped. It’s impossible to get ahold of the other person when you have concerns, and now they’ve gone and done something that caused you considerable financial loss. What can you do?

If you have a contract in place and the other party does not comply with the terms for any reason that is not legally valid, that contract has been breached and you can take steps to either enforce it or demand compensation for any resulting losses, or both.

A breach of contract falls into one of two categories:

 

  • Non-Material: involves an ancillary or minor contract detail. For example, if you are a clothing designer and the packages of dress silk that you ordered for July 5 arrive on July 6 instead, it is a non-material breach because the one-day delay is a minor deviation that does not go to the heart of the contract.
  • Material: affects the nature of the contract itself and is much more serious. For example, if you tell your fabric supplier that you MUST have that silk no later than July 5 because a wedding has been scheduled for the 8th and you need two full days to make the requested dresses, the delay could be considered a material breach because the time of delivery was essential to the contract.

 

When you feel that the other party has committed a material breach, it’s normal to feel angry and cheated. You may even want “payback.” But before acting on those feelings, take a moment to consider whether the breach was actually material.

  • Were you denied benefits under the contract that you reasonably relied upon?
  • How does the other party’s actions comport with good faith and fair business practices?
  • Was the breach under their control or due to outside influences?

Most contracts include a section detailing the steps to follow in the event of a breach. Depending on your contract, you may have to make an informal request for a resolution before commencing legal action. For a non-material breach, it is always advisable to continue performing your own responsibilities under the contract, but for material breaches, you may be excused from performing your end. If the breach was only non-material and you fail to honor your own obligations, you could end up liable for damages. Contact our office right away for a more accurate assessment of your situation, and whether a breach was material or not.

If you have a contract in place and the other party breaches any terms, you should consult with an experienced commercial litigation attorney. Ken and Nancy are dedicated to solving problems on behalf of their clients and will, if necessary, aggressively protect your interests in court. Call 307-733-4946 to schedule a consultation today.

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