What To Do After a Breach of Contract

When your business enters into a contract with another party—a client or customer, a supplier, or a vendor, for example—both your business and the other party are legally obligated to live up to the contract’s terms. If you or the other party fail to meet any of the terms, then a breach of contract has occurred.  

What Happens After a Breach of Contract?

So, what can you do after a breach of contract occurs? A breach of contract opens up the door for litigation to enforce any contractual obligations or to start the recovery process for any money lost by the breach. But does it have to go that far? Maybe. Maybe not. A rundown on what to do following a contract breach can help you better understand your options. 

Keep communication lines open.

When a contract breach occurs, it can sometimes be the most expedient and cost-effective option to just reach out to the other party. In some cases, the other party may not even know they have breached the contract. There may be some sort of payment issue that can be worked out in order to fulfill the contract’s terms prior to getting legal help involved. Negotiating with the other party, either yourself or through an attorney, is generally a smart idea and can result in the resolution of the breach in many instances. 

Consider alternative dispute resolution (ADR).

Not all contract breaches are destined to go straight to court. If the matter can potentially be resolved through ADR or even mediation, then that may be a better alternative that saves time and money while keeping the details of the breach confidential. Because the ADR process is less oppositional than suing the other party, it may help your business maintain a relationship with the other party. 

Understand your damages.

Whether your breach of contract issue is resolved through negotiation, ADR, mediation, or a lawsuit, it is important to accurately calculate your damages. Generally, there are monetary losses from contract breaches as well as damages related to unnecessary costs or lost profits. Determining your damages and then showing proof of them will be paramount to your successful claim. 

Act in a timely manner.

In Arizona, the statute of limitations for breach of written contracts is six years; for oral contracts, it is just three. If you wait too long to seek recourse following a contract breach, you may find yourself without options. 

Be ready for a lawsuit, if necessary.

Once you have depleted all possible resources to resolve the breach of contract, your only option remaining may be to file a lawsuit to be made whole again. Contact an experienced Phoenix business litigation attorney skilled in contract disputes for expert legal representation. 

Seek Help for a Breach of Contract Dispute

In a utopian business world, contracts between your company and your clients are executed without a hitch. Both parties enter into the contract feeling good about its terms, both benefit from having the contract in place, and everyone involved is happy with the outcome. Disputes are never even an afterthought. But the reality is far different. Financial problems arise, delays occur, and unforeseen circumstances can all cause dreaded contract breaches, leaving you wondering, “What’s next?” The Phoenix breach of contract lawyers at the Law Offices of William D. Black can help. Reach out for a free case consultation by calling 480-680-8519 or contacting us online