Our Breach of Contract Lawyers will enforce your contractual rights

Valid contracts create contractual rights and binding obligations which must be adhered to by the contractual parties. Contractual rights and obligations flow from the written or spoken terms of the contract and from any terms ‘implied’ into the contract by legislation or the common law. Our Breach of Contract Lawyers assist clients where a party to the contract has breached their obligations.

Implied contractual terms

Terms implied by legislation include ‘consumer guarantees’ under the Australian Consumer Law, ‘statutory warranties’ under the Home Building Act 1989 (NSW) and a range of implied terms for the protection of buyers under the Sale of Goods Act 1923 (NSW).

Common law implied terms are imposed by Courts where:

  • the parties would have expressly agreed to the term if they had considered the issue when entering into their contract,
  • there is a custom or usage that justifies the implication of a term, or
  • the implied term is a ‘normal incident’ of the type of contract entered into.

Expectation damages

The remedy which is most often awarded by courts in breach of contract matters is common law ‘expectation damages’ (often referred to as simply, “damages”). The purpose of an award of expectation damages is to put the innocent party (the plaintiff) in the position they otherwise would have been in if the defaulting party (the defendant) had performed their obligations under the contract. Expectation damages include economic damage (referred to as ‘loss’) directly caused by the defendant’s breach as well as any consequential loss caused by the defendant’s breach such as a lost opportunity to profit.

Liquidated damages

An assessment of damages is unnecessary where a plaintiff is entitled to ‘liquidated damages’ rather than expectation and reliance damages. Liquidated damages are the available remedy where the contract contains a fixed, agreed amount payable upon breach as a genuine pre-estimate of the innocent party’s loss. Importantly, a liquidated damages clause in a contract will be deemed an unenforceable ‘penalty clause’ if the amount payable is unreasonable in relation to the actual loss suffered as a result of the breach.

Assessing damages

Quantifying the monetary losses caused by the defendant’s breach (referred to as ‘assessing damages’) can be a difficult task for breach of contract lawyers and courts in complex matters, particularly where there is more than one cause for the loss claimed, or where intricate accounting is involved. In all cases, the plaintiff must establish at trial that the losses have a reasonable connection to the defendant’s breach of the contract.

Failure to perform a contractual obligation

A failure to perform a contractual obligation is a breach of the contract giving rise to certain rights (referred to as ‘remedies’) in favour of the innocent party. There are two types of contractual remedies: common law remedies and equitable remedies.

Reliance damages

Plaintiffs may also be entitled to common law ‘reliance damages’ as compensation for money spent in reliance on the contract, being expenditure the plaintiff would not otherwise have incurred if the contract did not exist.

Services our Breach of Contract Lawyers provide

In accordance with section 14 (1) (a) of the Limitation Act 1969 (NSW), claims for breach of contract in NSW must be brought within 6 years of the date on which the cause of action arises, or 12 years if the cause of action is founded on a deed (rather than a contract).

  • preliminary advice and case appraisal,
  • dispute notice reviews and drafting,
  • letters of demand,
  • negotiation and mediation, and
  • proceedings in NSW courts and the NSW Civil and Administrative Tribunal including:
    • applications for preliminary discovery under Part 5 of the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”)
    • applications for security for costs under Part 42, Division 6 UCPR
    • drafting and filing Statements of Claim and Cross Claim, Summonses, Originating Processes and Defences
    • urgent applications including injunctions and freezing orders under Part 25, Division 2 UCPR
    • preparation of lay and expert evidence
    • applications for default judgment under Part 16 UCPR, summary disposal under Part 13 UCPR and dismissal for want of due despatch under Part 12, Division 3 UCPR, and
    • applications to set aside or vary judgments or orders under Part 36, Division 4 UCPR.

The court or tribunal in which the claim is to be brought will generally depend on the jurisdiction governing the contract, the amount of the claim and the nature of the remedies sought by the plaintiff.

Legal proceedings can be costly and stressful and should only be an avenue of last resort. It is our practice to avoid legal proceedings where possible, however, where legal proceedings cannot be avoided, our breach of contract lawyers will litigate the matter vigorously and we play to win.

Our Breach of Contract Lawyers are experienced litigators

Where possible and appropriate, the contractual parties should engage in open and constructive dialogue prior to the commencement of any action for breach of contract. This is an opportunity to identify and address any genuine misunderstanding or disagreement and to preserve the commercial relationship between the parties.

In many cases, the contract will require the parties to take a particular course in relation to any dispute prior to commencing legal proceedings. It is important that parties to the contract understand the contractual requirements for dispute resolution and adhere to their contractual obligations before taking any further steps.

The parties should exhaust all efforts to resolve the dispute before taking more action. An innocent party to a contractual dispute may themselves commit a serious breach of the contract if they seek to terminate the contract or commence proceedings without first satisfying any dispute resolution mechanism embedded within the contract. Generally, the right to terminate a contract is governed by the contractual provisions, any relevant legislation and the common law. It is important that claimants understand that the right to terminate a contract does not always arise simply because one party breaches a term of the contract.

Where a party terminates the contract without the right to do so, the unlawful termination is, in fact, a repudiation (rejection) of the contract which the other party may elect to accept. That party may then themselves lawfully terminate the contract, sue for breach of contract and claim damages.

Where the dispute cannot be resolved by cooperative efforts, the parties may agree to participate in mediation or one party may commence legal proceedings. If the contract has not been terminated, the contractual rights and obligations of the parties will continue through the course of the proceedings.

Disclaimer

The information provided above is not to be taken or relied upon as legal advice and Jason Francis Commercial and Construction Lawyer will not be responsible for decisions made or acts or omissions undertaken in reliance on this information. It is information intended as a guide only. You should obtain independent legal advice in respect of any issue or query you may have after reading this information.

Liability limited by a scheme approved under Professional Standards Legislation.

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