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How can you defend against a breach of contract claims?

On Behalf of | Jun 6, 2022 | Business Law

Most businesses in Plano rely on solid, enforceable contracts. These contracts may be between the business and a supplier, vendor, other business or employee. As essential as these contracts are, there will be times when one party to a contract is accused of breach of contract.

What is a breach of contract?

Breach of contract occurs when one party fails, without legal excuse, to hold up their end of the bargain. This means they did not perform in a way that satisfies industry standards or they did not meet express or implied warranty requirements.

What are some defenses to breach of contract?

There are numerous arguments you can make if you are accused of breach of contract. For example, contracts that violate public policy cannot be enforced. A contract also cannot be enforced if performance has become impossible or the purpose of the agreement is frustrated. If the parties have already accepted what they are owed in the contract, they cannot later claim breach.

If a contract does not include consideration, it cannot be enforced. Contracts containing a mutual mistake also cannot be enforced. Fraudulent contracts also are unenforceable.

Contracts that limit how much an aggrieved party can pursue in damages regardless of actual loss may be unenforceable. Finally, if one or both parties to the agreement lack the capacity to execute a contract, the contract cannot be enforced.

Stand up for your rights

If you are accused of breach of contract, it can damage your business’s reputation and could possibly lead to stiff fines and other financial costs that impact your business’s bottom line. Thus, it is essential that if you are accused of breach of contract, you understand your defense options so you can make decisions that are in your best interests.