If someone mentions broken promises, many scenarios might come to mind. Some people may remember an incident from childhood when they were promised a special reward but never received it. Others might recall a romantic relationship where promises were made but not kept. A few individuals might think of politicians who do not follow through on campaign promises. However, not many people outside the legal field recognize that a broken promise aptly describes a breach of contract.
Broken Promises Occur in Many Ways
Contracts in the business world involve various situations, types of goods and amounts of money. They may vary from a $2,000 contract for a wedding cake to $20,000 for roofing a large residence to millions of dollars for the sale of oceanfront property. Although contracts may occasionally involve a trade of property or goods, most contracts specify a definitive amount of money or payment in exchange for various services, land, buildings, merchandise or personal possessions.
Failure of one party to carry out the obligation outlined in the contract to the other party results in a breach of contract. The broken promises may be pretty straightforward or vague enough to cause a significant disagreement over the breach:
- Payment is not met as specified or only partial payment is made
- The delivery date is missed
- A contracted service is not entirely performed or does not meet expected standards, such as a catered meal missing the salad course or serving an overcooked entree
- A mistake is made in the service or goods, such as painting a house the wrong color or delivering an appliance in the wrong finish
- The item was not correctly represented, such as a used car with more miles than the odometer shows
- The seller decides to keep a unique property, or valuable antique after the contract is signed
Although some breaches are clear-cut, many are not and often involve subjective opinions. For example, the violation is apparent if a painter uses blue paint when the contract calls for green. However, if frosted white is substituted for pearly white, the breach is not as apparent to most people.
Breach of Contract Resolutions Take Numerous Forms
Because several factors may affect the severity of a breach of contract, California law distinguishes material or total breaches and non-material or immaterial breaches. Once again, individual circumstances and even subjective opinions come into play.
Consider a contract for a wedding cake, for example. If the contract specifies white cake with raspberry filling, but the white cake is delivered with strawberry filling instead, is this a material breach? After all, the wedding couple is still getting a gorgeous, valuable cake delivered on time for their reception. However, perhaps the bride hates strawberries. Maybe the bride or groom or a family member is allergic to strawberries. This breach takes some sorting out. Breach of contract disputes can be settled by several different means:
- Negotiations between the parties
- Review by a mediator
- Binding arbitration by an impartial third party
- A lawsuit brought by one party against the other in small claims or circuit court
Courts May Award Several Types of Damages
When a breach of contract ends up in court, the judge or jury members determine the severity of the breach and provide a remedy with appropriate damages:
- General damages attempt to restore the plaintiff to the same financial outcome as if the breach had never occurred.
- Special damages are occasionally granted by the court to compensate the plaintiff for expenses incurred in expectation of the completed contract.
- Liquidated damages cover the specified amount of compensation outlined in a contract in the event a particular breach occurs.
- Special performance essentially orders the defendant to carry out the contract as written. This is often a remedy when the seller in the contract decides to keep the property or item.
- Cancellation and restitution may totally void the contract and restore any money paid in advance by the plaintiff.
Note that California law generally does not provide for punitive damages as additional punishment for the party that caused the breach.
Clear and Explicit Contracts Make Settlements Easier When Breaches Occur
Seeking the assistance of a lawyer familiar with contract law helps assure any contract you sign is clear, understandable and outlines detailed expectations for both parties. A good contract avoids any vagueness and ambiguity, but it may also provide for liquidated damages in the event of a breach of contract, making it easier to settle any disagreement that arises.
An Experienced Attorney Helps Solve Contract Disputes
If a business or individual has failed to carry out written promises made to you in a contract, or you are accused of committing a breach of contract, consult an experienced attorney to help sort through your options and take the best action in your case. Contract law can be confusing, so let the professionals at the Law Offices of Brent D. George help guide you with a free consultation. Call (805) 494-8400 today.