What Constitutes Breaching a Contract in California?
If you’re in business, contracts are integral to your company. But if you’re accused of breaching a contract, it can be a frustrating, costly, and somewhat humiliating experience.
Suppose you wait, and the issue gets out of hand. In that case, your reputation can be irreparably damaged and disrupt your business operations in numerous and dire ways, costing you money and time. Fortunately, with the experienced legal representation this matter demands, defenses are usually available to you to avoid or limit your liability and losses.
In many cases, the most common defense against a breach of contract accusation or claim is the “affirmative defense.”
Let’s say you or your company breach a contract and don’t fulfill your obligations under the terms of the original agreement. A non-fulfillment accusation can take many forms, such as:
- A total failure to perform – You or another party doesn’t complete their duties as specified in the agreement or contract.
- You partially performed – One party involved partly completes their contractual obligations.
- Or, you performed late – Your obligations under the contract are fulfilled but not within an agreed timeline.
First, you must know that for a breach of contract to be actionable, the following issues must be present:
- You must have a valid and formal contract – There must be a formal and legally binding contract between both parties.
- A provable breach must occur – One of the parties involved must have noticeably and legally failed to perform their prescribed contractual duties.
- There must be damage inflicted – The non-breaching party must have sustained provable and actual harm or loss directly because of the breach.
Understanding what constitutes a breach will give your skilled and well-versed business lawyer the firm groundwork needed to strategize a robust defense if you’re accused of breaching a contract.
What is Affirmative Defense and Can It Help My Case?
Simply put, an affirmative defense is an argument that, if substantially proven, negates or reduces your liability (as the defendant) in a breach of contract case. In most cases, standard defenses usually rebuke the plaintiff’s claims. However, a well-thought-out and professionally formulated affirmative defense will introduce new evidence and arguments that, even if your accusers’ claims are valid, provide a rational and sound legal basis for dismissing or minimizing the breach, thus minimizing your possible liability and penalties.
Many breach-of-contract defenses are referred to as “affirmative defenses.” But you should note that in these cases, it’s common that the party raising the defense (the person being sued for the breach) has the burden of proving the affirmative defense if the case goes to trial.
By using an affirmative defense, you and your competent business lawyer do not contest the primary claims or facts of the case but instead bring up mitigating facts and specific circumstances that render the accusation of a breach moot.
For example, let’s say you hire a speaker for a company meeting, and they don’t show up to speak; you could sue the speaker for breach of contract. However, regardless of whether the speaker breached the agreement, they may assert the affirmative defense that they couldn’t enter into the contract in the first place because of a serious illness.
This may sound rather wild and vague, but these affirmative defenses can be highly effective in contract disputes. They effectively shift the focus away from the breach and onto whether there were sound and valid reasons that the breach occurred.
For this and many other reasons, if you’re accused of breach of contract, you must obtain professional, rational, and experienced legal counsel, carefully examine your options, and mount a defense strategy that aligns with your and your company’s interests.
What Are Some of the Common Breach of Contract Defenses?
Defending you in a breach of contract case is a wide-open scenario and virtually only limited, in many cases, by your lawyer’s imagination, experience, and knowledge of California business Contract laws.
That said, just a few of the most common defenses in a breach of contract case are:
- The contract is not legal – In California, if any part of a contract is found to be unlawful, the entire contract is considered void. Simply put, it is legal to breach a contract that requires someone to perform any illegal act.
- There are fraudulent pretenses for the contract – Fraud may have been committed if the other party intended to deceive another person into a contract. Some examples of this are:
- The suing party made a promise and had no intention of keeping it.
- The accuser intended to deceive you (as the defendant).
- The accuser gave you misleading information or hid important information you should have known.
- The contract is indefinite, and essential terms omitted – If certain vital parts were never agreed upon, you and your diligent business lawyer may argue that the contract is indefinite. This means the parties involved did not consider the deal final, as certain necessary specifics were omitted.
- The accusing party (or plaintiff) suffered no damages – In this case, if you (as the defendant) breached the contract, you may admit to it but show that the other party suffered no damages.
The above are only a few defenses that a highly experienced, knowledgeable, and competent business lawyer may use to defend your breach of contract accusation. However, these cases can be legally challenging, and if you are being accused, your best defense is to get professional legal advice as soon as possible; the sooner your lawyer analyzes your case, the better your chances of getting ahead of the situation and minimizing your potential penalties.
What is California’s “Catch All” Defense for Breach of Contract?
In California, if you’re being accused or sued for breach of contract, the state’s business law permits you to claim numerous alternative defenses. This holds even if some of your proposed defenses contradict others.
Let’s say you and your lawyer argue that the contract is invalid or unenforceable. However, you still performed as required, and alternatively, the accuser’s actions justified your failure to perform.
In many of these defenses, not all the arguments can be valid. However, one of these defenses may mitigate your liability, and, in the end, you may admit to the breach and only assert defenses to the damages claimed by the accusing party.
I’ve Been Accused of Breaching a Contract in California; How Should I Proceed?
In California, contracts can be particular as to their terms and conditions. Therefore, if you’re being accused of breaching a contract (or on the opposing side), you can significantly benefit from consulting with an experienced, passionate, and highly knowledgeable Oakland or San Francisco business lawyer.
These cases can be extraordinarily complex and legally tricky, and if they include specific items, such as a binding arbitration clause, are unclear, or are old, consulting with a local, diligent business lawyer is mandatory.
The well-versed, highly competent business lawyers at Geonetta & Frucht, LLP, have provided trustworthy counsel for local businesses for decades in resolving these vexing and sometimes costly disputes.
Call them today at (510) 250-2743 in Oakland or San Francisco at (415) 237-1212 for a free consultation on your unique case. They will work tirelessly and passionately to get you back to “business as usual” as soon as possible.
