Generally, contracts are those agreements signed by two or more parties including people, companies, civil organizations and even government institutions. These bonds may either consist of the contracting parties' guarantee to perform or to cease from doing a specific action for a particular cost. Normally, these are done in form of writing, either formal or informal, but in some instances, it can also be done verbally.
Contracts usually contains terms such as who's, what's, where's and how's of the arrangement. These stipulations will define both parties' obligations and the manner and period in which the agreement must be done.
Contract Breach
Primarily, breaches occur when one party fails to meet his part stated in the contract. These may happen due to the following circumstances:
- One side of the accord has given the other difficulties in meeting his obligations to the contract
- One party involved in the contract has exercised some dealings contrary to the objective of the agreement
- One party has completely refused to do his obligations stipulated in the contract
Remedies for Breach of Contract
Remedies that may result from contract infringements are as follows:
- Compensatory Damages - monetary payments provided to cover the losses
- Consequential and Incidental Damages - monetary reimbursements paid to cover foreseeable damages, which are possible losses if a breach would occur and are already known by both parties at the time of the agreement
- Legal Counsel's fees - these may only be reimbursed if stated in the contract
- Liquidated Damages - these damages may be recovered if a fraudulent act was done
- Specific Performance - an order issued by the court to carry out what is indicated in the agreement
- Rescission - this pertains to the cancellation of the contract, releasing both parties from continuing whatever is agreed upon. With this, any amounts given by any party in advance will be returned.
- Reformation - this refers to the readjustment of the agreement to give chance to the infringing party to perform his obligation in the contract
Filing of Charges
The Anti-Breach of Contract Laws provides guarantees the protection of both parties' rights. These provisions compel both parties in the contract to abide all the things that were stipulated in the agreement.
However, it is always recommended to consult an expert business lawyer whenever an aggrieved party wishes to pursue a case in court.
Another option in resolving this issue, aside from filing a lawsuit, is engaging into a direct negotiation wherein both parties will try to settle things outside the court. Here, both of them will analyze their case and calculate the resulting damages that the infringing party should reimburse. This performance will definitely speed up the resolution of the case.
