People in modern world generally create number of contracts in order to perform their day to day activities. Most contracts are directly linked with the career performance and some contract creates the special relationship between the parties.
First of all, what is a contract?
Contract is defined as an agreement between two or more persons to do or refrain from doing a specific thing in exchange for something of value.
What does breach of contract mean?
Breach of contract simply means the failure of a party to perform what they promised to do. In other words, it means the violation of a contract by failing to perform one’s contractual obligation.
However, breach of contract may creates some consequences, and thus, it gives rise to a cause of action. Therefore, aggrieved party may seek some remedies for the breach.
But, some contacts may be ending on non-dishonored of one party and other party would not intend to take any action against the breach. Thus, if there is a breach of a very important term of contract, then the innocent party is given the option to bring the contract to end.
However, only the breaches which are sufficiently serious generate this right to the innocent party.
This may depend on terms and conditions, as well as the facts and the circumstances of the contract and the action of the parties.
However, if a party does not fulfill his contractual promises or will provide information to the other party about his intention not to perform his duty as set out in the contract, he is said to have breached the contract
Thus, a breach of contract may be either actual or anticipatory. Therefore, where one party refuses to perform or perform incompletely his contractual obligation, it is known as the actual breach of contract.
The anticipatory breach occur where one party inform in advance that he intend not to perform his contractual obligations. Then, the innocent party who suffer from the breach could sue for damages.
However, the object of damages is usually keeping the injured party in the same financial position he would have been in, if the contract had been properly performed.
Where the breach of contract results the non pecuniary loss such as distress and loss of enjoyment, compensations are not usually awarded. But in practice, following the breach of contract, compensations are awarder for such losses only where the contract’s main purpose is to promote the happiness or the enjoyment of the parties.