Our dispute resolution solicitors have a wealth of experience in advising commercial clients on contract disputes over a diverse range of contracts, for example arising from failure to provide services, defective goods or failure to meet payment obligations.
Contract terms are generally classified into different types according to their importance to the agreement as a whole. Some terms are ‘fundamental’ to an agreement, for example a term specifying the nature of goods to be delivered under a contract for the supply of goods. Other terms might be regarded as ‘minor’ terms of lesser importance. Different terms create different legal rights. Typically only breach of a fundamental term of a contract will allow the innocent party to cancel the contract. With other types of breach, generally the party in breach has to be given an opportunity to remedy the breach.
Where a breach of contract is not or cannot be remedied, the general legal principle in so far as compensation is concerned is that the innocent party should be placed in the position which he would have been, had the breach not occurred. Sometimes contracts attempt to exclude liability for compensation for breach of contract. Whether terms of this type can be enforced depends on various factors, including whether the contract is between a private individual dealing as a consumer with a business, or whether the contract is business to business.
Breach of contract issues are rarely straightforward. Timely, accurate and sensible legal advice is often key to avoiding protracted disputes.