Both parties in a business contract want to benefit from the outcome. However, delays, financial problems and unexpected events can hinder business contracts. When a party can’t fulfill their part of the contract, the other party can sue for breach of contract. Business litigation in Ohio has multiple options when a breach of contract occurs.
What is a breach of contract
In business litigation, a contract is an agreement between parties to complete obligations. A party that fails to fulfill its obligations is in breach of the contract. There are many circumstances where a breach can occur, such as not performing at all, performing late or not performing correctly. A breach is either a material breach or an immaterial breach.
Suing for breach of contract
When a breach of contract occurs, one or both parties may want the terms enforced or want to recover any financial harm. A breach of contract lawsuit happens when a dispute happens and informal resolutions fail. The parties may resolve the breach of contract in small claims court. Courts and lawsuits aren’t the only options for parties in contract disputes, however; a mediator can agree to look over the contract and hear each party’s case.
Remedies for a breach of contract
When a party breaches a contract, the other party deserves relief or remedy. The remedies for a breach of contract are damages, specific performances or cancellation and restitution. There are several types of damages:
- Compensatory damages help the non-breaching party get what they would have if a breach didn’t occur.
- Punitive damages have the breaching party pay beyond the contract compensation.
- Nominal damages are small monetary awards when no financial loss happens.
- Liquidated damages are specific damages named in the contract.
Specific performances are for the breaching party’s court-ordered performance in the contract. They help repay breach of contract lawsuits. The non-breaching party could cancel the contract without any repercussions. Restitution allows the non-breaching party to be compensated for the loss. Breach of contract lawsuits depends on the situation, but most end with a monetary payout.