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Four Types of Breach of Contract You Should Be Aware of

Four Types of Breach of Contract You Should Be Aware of

When two parties enter into an agreement, they form a legally binding contract. A breach of contract occurs when one or both parties fail to meet the obligations outlined in the agreement. It is important for businesses to be aware of the different types of breach of contract so that they can protect themselves and their rights.

If you are dealing with a breach of contract, Slate Stern Law can help. Our Santa Fe breach of contract lawyer can help you sue the other party for the breach or – if you are accused of breaching a contract – defend you against the accusations.

Four Types of Contract Breaches

Here are four categories of breach of contract that you should know.

1. Material Breach of Contract

A material breach is considered serious, meaning it has caused significant damage or loss to one or both parties involved in the contract. This type of breach also refers to a party failing to fulfill a major part or obligation under the agreement made with the other party. An example would be if a service provider fails to deliver on their promise due to their negligence. In this case, the service provider would be guilty of a material breach and could be held liable for any damages incurred by the other party as a result.

2. Minor Breach of Contract

This type of breach occurs when one party fails to fulfill a minor obligation that was outlined in the original contractual agreement. Unlike material breaches, minor breaches do not usually cause significant harm or damage to either party involved in the contract. An example would be if one party fails to submit payment on time but still fulfills all other aspects agreed upon in the contract; this would constitute a minor breach and can usually be resolved without any outside help from lawyers or courts.

3. Anticipatory Breach of Contract

An anticipatory breach occurs when one party communicates that they will not fulfill their obligations under the terms outlined in an agreement before it is set to expire. This type of breach can also occur if one party fails to perform an action within a reasonable amount of time after being asked by another party involved in the contractual agreement.

The implication here is that one side has already decided they are not going through with their end of the bargain before it was even due and, as such, have breached it ahead of time, leaving them vulnerable to legal consequences and damages claims brought against them by other affected parties.

4. Actual Breach of Contract

Actual breaches are those where there is clear evidence that one side has failed to meet their responsibilities under an existing agreement between two parties. This type of breach is usually easy for courts and lawyers to identify and prove because there is clear proof available showing non-compliance from either side involved in a contractual arrangement. Examples include failure to pay rent on time or deliver goods according to agreed-upon timelines, among other similar scenarios.

By understanding these four types of breaches, businesses can be better equipped when dealing with potential contract breaches. If you are considering filing a lawsuit for a breach of contract, keep in mind that you have a limited amount of time to do so. New Mexico Statutes § 37-1-3 gives the wrong party six years for filing a lawsuit for a breach of contract.

Consult With a Breach of Contract Lawyer

Breaches of contracts can have serious repercussions for all those involved, so it is important for businesses and individuals alike to understand what types exist and how best they can protect themselves from potential issues arising from these situations. Our experienced lawyer at Slate Stern Law can help you identify the legal remedies available to you if you are dealing with a breach of contract. Get a case review by calling (505) 814-1517.