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How can the courts help you resolve a breach of contract?

On Behalf of | Sep 29, 2021 | Uncategorized

Your small business probably executes many different kinds of contracts. For example, you protect yourself by signing employment contracts with everyone that you hire. You will likely also create a written agreement with vendors and service providers. Even your clients or customers may have to execute a contract to do business with your company.

A well-written contract will make it clear what responsibilities each party has, from delivery dates and costs to conflict resolution requirements. Unfortunately, some people will not follow through on their contractual obligations.

A breach of contract could be a source of significant hardship for your business. You may have to go to court to resolve the matter. What are the ways that the courts could help you address a breach of contract?

They can void or invalidate the contract

If a customer, service provider or vendor has failed in their obligations to your company, you may no longer want to do business with that individual or company. However, in many contracts, a violation by one party will not inherently end the obligations of the other. You may need to go to court to have a judge void the contract so that you aren’t subject to breach-of-contract claims by the other party.

They can award you damages

A former employee stealing your trade secrets or a supplier failing to deliver goods on time could lead to provable financial losses for your business. When a documented breach of contract has adverse financial consequences for your company, you can ask the courts to award you damages to compensate you for the practical consequences of that breach.

They can order specific performance

Sometimes, what you really need in a breach of contract scenario is for the other party to follow through with contractual obligations to your company. When a judge orders specific performance, the obligation of the other party intensifies. If they do not fulfill their contractual obligations as ordered by the courts, they will not only be in violation of the contract but also in contempt of a court order.

Any of these solutions can help you when another party fails to follow through with their obligations to your company. Thinking about how a contract issue has affected your small business can help you determine how to resolve a contract issue.