When you run a business, you may enter into contracts with other individuals or entities. They could be vendors, distributors, financial service providers, repair technicians or just about any other type of business or organization. You hire them to do a job, and they accept the job with the expectation that they will complete it in a timely fashion according to your needs.
So it would be be nice if everyone who signed a contract adhered to its terms. Unfortunately, it doesn’t always happen.
A breach of contract may range from a material breach—in which one party simply does not fulfill the terms of a contract—to an anticipatory breach, in which it becomes clear that one party will not be able to fulfill its responsibilities as detailed in the contract.
Has there been a breach of contract?
Before you can take action, it’s essential to determine whether there has, in fact, been a breach of contract. Understanding the specific facts of your situation will be important when it comes to resolving the issue. The most basic questions that need to be answered are whether a contract was actually in place, the other party failed to abide by its terms and their failure to do so directly caused your company harm.
Without there being an actual breach, and without there being actual harm inflicted upon your company, you’re not likely to have much success persuading a court that the other party owes you anything. However, even in the event that a breach of contract is clear, the court system should not be the first place you turn for a resolution.
Work with the other party
Initiating a legal battle with another individual or business over breach of contract should really be your last course of action. Instead, if you believe the other party has failed to honor the terms of your contract, and that your business has suffered in some way as a result, get in touch with the other company and explain your concerns. In many cases, the other party will appreciate the show of good faith and will work to right the situation. This also reflects well on your business, as it demonstrates attention to detail and a commitment to conducting business in an open and honest manner.
In the event that the other party still fails to meet the terms of the contract even after you’ve been in touch—or in the event that they maintain there hasn’t been a breach of contract at all—it may be time to seek a legal remedy. A skilled business attorney can answer your questions and help you determine your best next steps when dealing with a breach of contract issue.
BoltNagi is a widely respected and well-established business and corporate law firm proudly serving clients throughout the U.S. Virgin Islands.