Breach of Contract

Most businesses rely on agreements with suppliers, customers, and other entities to operate and stay afloat. When one party to a contract breaches it, the violation can potentially jeopardize an enterprise’s ability to operate. Steve A. Buchwalter is an experienced business litigation lawyer who helps clients in Orange County and throughout Southern California navigate breach of contract cases. He is a tenacious litigator with more than two decades of experience providing representation in business disputes.

A contract is an agreement between two or more parties in which there is a promise to do something in exchange for valuable consideration. For a contract to exist, the terms must be clear enough that the parties understood their obligations, agreed to give each other something of value (consideration), and mutually agreed to the terms.

A contract may be express or implied. It is express if it is in writing or oral. Under California law, oral contracts are enforceable, unless they are required by law to be in writing. For instance, real estate contracts, and those that cannot be performed within a year, must be in writing. A contract can also be implied based on the conduct of the parties.

A breach of contract is a violation of its terms. Whether there is a breach depends on the language in the agreement and each party’s performance based on its contractual obligations. If a contract is written, courts will look at its actual terms to see if there is a breach. A court may also supply some terms if the parties did not explicitly agree to them. If there is no specific date for performance, for example, the court may imply a reasonable time. What is “reasonable” depends on the facts of each case, including the contract’s subject matter and why the parties entered it in the first place. If the agreement is oral, certain evidence may be enough to show the existence and terms of a contract, including electronic communications.

The plaintiff bears the burden of proving that the defendant breached the contract. To prove a breach of contract, the plaintiff must show:

• The existence of a contract;
• Its own performance of obligations under the contract, or an excuse for nonperformance;
• The defendant’s breach, or failure to do something that the contract required; and
• Damages caused by the defendant’s breach.

If the defendant’s performance is contingent on something else happening first, the plaintiff must also show that all of these conditions occurred.

There are differences in the severity of a breach. A party to a contract cannot stop performance for a non-material breach. A material breach, however, may give a party the right to stop performing its side of the bargain. What is “material” depends on the context and varies from case to case, but it usually goes to whether the breach strikes at the root of the agreement. A non-breaching party also has to take reasonable steps to mitigate its damages and prevent additional harm.

The measure of damages is usually based on the nature of the contract. The non-breaching party may recover profits or benefits, as long as they are reasonably ascertainable. For instance, a new business may be unable to recover anticipated or future profits, but this may not be the case with an established business or commercial relationship.

Knowledgeable civil litigation attorney Steve A. Buchwalter has represented clients from Los Angeles and the surrounding area in numerous commercial disputes, including breach of contract. He can assess your particular situation, discuss the strengths and weaknesses of your position, and advise you on how to move forward in a breach of contract case. He works with clients in Pasadena, Irvine, and Santa Barbara, among other communities throughout the region. Call us at (818) 501-8987 or use our online form to schedule a confidential consultation.