Breach of Contract Equitable Defenses
What are Equitable Remedies for Breaches of Contract?
- Specific performance- requiring the breaching party to fulfill their portion of the bargain
- Contract rescission- canceling the previous contract and replacing it with a new one
- Contract reformation- rewriting or revising the existing contract in order to more clearly meet the parties’ demands
Are there any Defenses to Equitable Remedies?
- Laches: The non-breaching intentionally delayed in bringing forth a lawsuit for the breach of contract. The delay must result in prejudice to the breaching party
- “Unclean Hands”: The non-breaching party had committed the same type of breach that the breaching party committed. Under equitable principles, the party claiming relief should not violate the contract terms
- Hardship: equitable remedies are not issued if they would result in undue hardships to the breaching party
- Unconscionable contract: Recovery is not available if the contract is “unconscionable”. Unconscionable means that the agreement is so one-sided that it is unfair for one of the parties
- Illegal contract: Illegal contracts cannot be enforced either under legal or equitable principles. These include contracts for gambling, prostitution, drug distribution, or other illegal acts
- Mistakes: Sometimes mistakes in the contract terms can prevent a party from recovering. Recovery may be limited based on whether the mistake is mutual or if only one party was mistaken as to the contract provision
- Misrepresentation: The contract may not be enforceable if it was made under conditions of misrepresentation, such as those agreements made through fraud, deceit, or lying
- Undue Influence: Equitable relief may not be available if there has been any instance of undue influence, such as in cases where one party has used their position of authority to take advantage of the other party
- Duress: This is similar to undue influence, except that it usually involves threat of physical harm to one’s self or loved ones
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Last Modified: 09-26-2012 03:30 PM PDT
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