When business owners execute contracts with workers, service providers or vendors, they expect the other party to comply with the contract. Unfortunately, breach of contract situations are somewhat common.
Factors ranging from increasing expenses to communication issues may result in a company or professional violating an agreement with a business. When that happens, leadership at the affected organization has to make a decision. In some cases, they may elect to take the matter to court.
Breach of contract lawsuits can help reduce the harm caused by contract violations. How do the civil courts address breach of contract issues?
Judges can offer many types of remedies
Civil court judges have more authority than many people realize. During breach of contract litigation, they can offer many forms of relief to the plaintiff.
They have the power to invalidate a contract through rescission. In some cases, that may be the best option available after a breach of contract occurs. Other times, judges can offer other forms of relief to the plaintiff in a contract lawsuit scenario.
They can enforce the contract with an order of specific performance. A vendor or service provider may have to follow through on the terms of the initial agreement. A judge can also require that one party redo work that did not meet contractual standards.
The judge also has the authority to enforce penalty clauses that assign financial consequences to certain types of behavior, such as late payments or the disclosure of private information. A judge can also issue an injunction to prevent inappropriate conduct in cases where one party may have breached a confidentiality agreement or engaged in unfair competition against a business.
Finally, judges can order financial compensation in the form of damages when a contract controversy has economic consequences for one of the parties involved in the dispute. Resolving a breach of contract scenario often begins with a review of the contract. From there, the concerned party may need to send notice of the potential contract violations. If the other party does not resolve the matter quickly, then a lawsuit could help resolve the matter.
Understanding the possible solutions available through civil litigation can help those running businesses assert themselves during a dispute related to a contract. The civil courts offer many forms of relief for those harmed by breach of contract situations.