Breach of contract is a tough and unfortunate reality that many business owners and managers have to face. As much as you might like to manage a business where you never have to deal with a disgruntled employee or shady partner, there are always going to be some people who go back on their word when it suits them. Others may simply be oblivious to the terms they signed and the damage they can cause. Regardless of the reason for a breach of contract, its effects can be devastating and business litigation could result.
Violations of Intellectual Property
Some of the broadest categories of breach of contract relate to intellectual property. The violation of a non-disclosure agreement is one major category, in which a contractor, employee, executive, or other party discloses information they were contractually obligated not to share with others. This also applies to trade secrets, where the release of information about your trade secret could put you out of business. As soon as any of these types of breach of contract occur, you should immediately consult with a litigation attorney.
Refusal to Perform One’s Obligations
Any time a party in a contract decides not to fulfill the duties they have been contractually obligated to perform, this represents a repudiation of obligations breach. Sometimes called a fundamental or material breach, this is such an egregious breach that it permits the other party to terminate the contract, as well as pursue a corporate lawsuit for damages. If the material breach is in advance of the due date for performance, it’s known as anticipatory, while a failure to deliver on the due date is known as an actual breach.
The Minor or Partial Breach
There is another common category of breach of contract to keep in mind. The minor breach, or partial breach, occurs when a job was done, but it wasn’t done to the standards agreed upon or was incomplete in some respect. Often, the harmed party can pursue business litigation to seek damages for the partial breach, but is not excused from performance of the contract, such as payment for a service or continued association with a partner.
In the event that the harmed party in a breach of contract decides to seek damages through business litigation, it will benefit from immediate consultation with a competent litigation lawyer. If you’re on the receiving end of a breach of contract, your corporate lawyer can guide you through the process of filing the suit and outline whether you’re likely to receive compensatory and punitive damages as remedies.