Breach of Contract

A breach of contract can quickly become costly – both financially and commercially. The question of when you should instruct a contract lawyer for breach of contract often depends on the level of risk, the available evidence and what the contract actually says. In this article, we explain how to approach the decision to seek legal support.

What Does a Breach of Contract Mean in Practice?

A breach of contract occurs when one party fails to fulfil its obligations under the contract, for example through delay, defective delivery or non-payment. Whether a breach of contract has occurred depends, among other things, on:

• how the contract is drafted,
• which obligations the parties have assumed, and
• whether there are limitations of liability or specific terms.

In more complex commercial contracts, particularly where significant values are involved, the interpretation of the contract is often decisive in determining whether a breach of contract exists. In long-term business relationships, interpretation may become more complex, as the way in which the contract has been applied over time may influence how it is understood and construed.

Common Remedies for Breach of Contract

Typical legal remedies for breach of contract include:

• remedy or replacement delivery,
• price reduction,
• damages, and
• termination of the contract.

Which remedy is available depends both on the contract and on non-mandatory legislation, such as rules of sale of goods law. It is not always obvious which remedy is most strategically appropriate for the company in the longer term.

When Is It Sensible to Instruct a Contract Lawyer?

It can be particularly valuable to instruct a contract lawyer when:

• the parties disagree on whether a breach of contract has occurred,
• the contract is unclearly drafted or does not regulate the situation in question,
• substantial amounts, key customers or business-critical services are affected, or
• you are considering terminating a contract or claiming damages.

A contract lawyer can help analyse the contract and the factual sequence of events, assess the evidential position and develop a strategy from both a legal and commercial perspective.

Preventing Breach of Contract with a Contract Lawyer

Many disputes concerning breach of contract could have been avoided through clearer contracts from the outset. Clear rules on service levels, allocation of responsibility, limitations of damages and the handling of defects reduce the risk of conflict.

At Morling Consulting, our contract lawyers support companies with contract law matters. By reviewing contract structures, standard terms and internal processes, the risk of breach of contract and subsequent disputes can be reduced significantly. Read more about our legal services for businesses and how we can help you manage contract law matters in a structured way.