When a contract is breached, several remedies are available to the injured party.
HOUSTON, TX, November 22, 2022 /24-7PressRelease/ —
The Enforcement of Contracts Is Key in Business Relations
Contracts are an essential element of the business world. When one party fails to perform their obligations under the contract, the non-breaching party can file a lawsuit to legally enforce the contract. Remedies available under the law are designed to place the injured party in the position they would be in if the other party had not breached the contract.
Attorney Andrew Weisblatt explains, “Consulting a business litigation attorney who specializes in contract law can help you determine the best way to settle your particular contract dispute.”
Types of Monetary Damages Available
Monetary damages are awarded to put the harmed party in the same economic position they would have been in if the contract had been performed. There are two general categories of damages that may be awarded, compensatory and general. Compensatory, or actual damages, are awarded to recover the economic loss caused by the breach. Punitive damages may be awarded to punish the breaching party.
Punitive damages are more rarely awarded because the non-breaching party must show that the breaching party acted willfully, maliciously, or fraudulently.
As the non-breaching party, it is important to understand the duty to mitigate. Any monetary damages recovered by the injured party may be reduced by a failure to mitigate the harm.
Specific Performance Is Also a Remedy
In cases where monetary damages are inadequate to compensate the injured party, a court may force the breaching party to fulfill their obligations under the contract. Specific performance is a form of equitable relief.
A court will rarely order specific performance in cases where monetary damages are sufficient to compensate for the breach. Cases where specific performance is the best remedy must involve some item that is so unique, like real property, antiques and heirlooms or artwork, that monetary damages will not adequately compensate the loss.
Other remedies available under the law include rescission, reformation and restitution. Recission refers to cancellation of the contract, where both parties are excused from further obligations and any monetary exchanges are returned. Reformation allows the parties to change the terms of the contract to reflect their original intentions.
Restitution may be awarded when one party has unfairly benefitted at the expense of the other party. Unlike compensatory damages, which represent the actual financial losses of the non-breaching party, restitution is measured by the value of the benefit to the breaching party.
About Weisblatt Law Firm
The experienced legal team at Weisblatt Law, a Houston law firm, is qualified to handle all types of business legal matters, including breach of contracts. They have represented business clients in all industries facing a variety of business law challenges.
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