Book Opener

l How to explain theconcept of anticipatorybreachl How to identifyremedies available forbreach of contractl How to define specificperformancel Why you mustminimize the damagesinvolved in a breach ofcontractUnderstanding theremedies available whena contract is breachedwill help you pursuesatisfaction if thishappens to you.l breach of contractl anticipatory breachl damagesl actual damagesl incidental damagesl liquidated damagesl mitigation of damagesl specific performancel injunctionRemedies of theInjured PartyBreach of ContractA breach of contract occurs when one party to a contract fails toperform the duties set out in the terms of the agreement. If you fail tofulfill your obligations by not carrying them out or by performing themin an incomplete or unsatisfactory manner, then you are said to havebreached the contract.Contracts are usually breached after the performance date. Sometimes,however, parties to a contract notify the other party that they willnot go through with the contract before the time for performance. Theyhave breached, or violated, the agreement before they were required toact. This is called anticipatory breach . Formerly, the injured party hadto wait to bring suit until the time for performance had passed. Manystates now permit the injured party to bring an action for damages immediately,without waiting for the actual time for performance to arrive.Example 11. A youth group to which you belong has made acontract with a carpenter to build a teen activity center. The carpenteris supposed to begin work on June 20, but she calls thedirector of your group on January 9 to explain that she will notbe able to fulfill her obligation. Your group can bring an actionfor damages against the carpenter for an anticipatory breach anytimeafter January 9.The principle of anticipatory breach does not apply to promises topay money at some future date. Someone who refuses to pay moneyowed on a future date cannot be sued until after the payment is due.DamagesWhen a contract is breached, the injured party has a choice of remedies.A remedy is a legal means of enforcing a right or correcting awrong. If you are the injured party, you have three options. You may:accept the breach; sue for money damages; or, in some cases, ask thecourt for an equitable remedy.Acceptance of BreachIf one party breaches a contract, it is an excuse for the other partynot to perform. For example, if someone failed to perform under a contractwith you, you may simply accept the breach and consider the250 Unit 2: Entering Into Contracts