A contract is a legally binding and enforceable contract between two or more parties. Each party to the contract makes a promise to do something or refrain from doing something in exchange for the other party’s promise.
A breach of contract occurs when one party fails to perform their duties as specified in a contract. A contract may be breached by one or all parties. Legal consequences may result for the breaching party. A breach may either be material or non-material depending on the nature of the breach.
A material breach is a party’s failure to perform a major part of the contract. The breach is substantial and prevents the contract from being completed or defeats the purpose of the contract. A non-breaching party is thus no longer obligated to finish their performance under the contract.
A non-material breach, or minor breach, occurs when a party fails to complete a less serious part of a contract. The contract can still be completed in the event of a non-material breach. Thus, the non-breaching party is still obligated to complete their performance.
An example of a material breach might be in an electrical contract, where an owner of the home has contracted to pay an electrician to install high-grade wires for safety purposes. Instead, the electrician installs low-quality wires which do not work as well and cause damage to the walls. This would be considered a material breach since the intent of the contract (safety) has been disregarded.
An example of a non-material breach might be if the home owner contracts for black colored wires but the plumber installs red colored wires, which perform just as well and are not visible after installation as they are sealed behind the wall. This would be considered a breach, but would be non-material because the overall outcome of the contract is the same.
In a material breach, the non-breaching party:
Regardless of whether the breach is considered to be material or non-material, it is in your best interests to seek the advice of a business lawyer. Material breaches will usually give rise to a viable cause of action in a court of law. Non-material breaches are also important because there may be damages involved that need to be remedied in court. A lawyer can provide much guidance in presenting your arguments or defenses.
Last Modified: 11-09-2017 12:11 AM PSTLaw Library Disclaimer
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