A contract is an agreement that is usually between two parties. Contracts typically outline the rules that each party must follow; if a party fails to do what they said they would, the other party may be entitled to compensation.
In some cases, when a party breaks their promise, known as breach of contract, the damage done to the other party is minimal. In these cases, remedies may include specific performance, contract rescission, or contract modification.
However, in other cases, the damage can be extensive. This means the breaching party may be ordered to pay a large sum of money, known as damages, to help bring the injured party back to where they were before the breach of contract.
Damages are an award that are paid to a party who has suffered loss or injury. There are several different types of monetary remedies in law, including:
As mentioned, equitable remedies require the ordered party to act or refrain from acting in some way. The court could order:
Specific performance isn’t always available, for example, if it is impossible for the contract to be completed. While the non-breaching party might want the contract to be completed, the court cannot order the breaching party to complete the impossible.
A contract rescission would put the parties in the situation they were before the contract was formed; as if the contract never existed. This means that any money or goods exchanged during the contract would need to be returned. While it allows both parties to form a new, different contract, it is often used in situations where a party was fraudulently induced to sign the contract.
Contract reformation can be used for something as simple as a mistake/error in the contract, like a misplaced comma that turns $12,000 into $120,000. It can also be used in cases of fraud, if the other party still wants to enter a contract and the fraudulent party agrees to fix the contract.
If you have any questions regarding the damages available for breach of contract, you should contact a local business lawyer. An experienced attorney will review your contract and advise you of your best course of action. If necessary, your lawyer will also represent your best interests in court.
Last Modified: 07-27-2018 01:30 PM PDTLaw Library Disclaimer
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