Experienced Business Law And Dispute Resolution Representation

5 steps for addressing a breach of contract

On Behalf of | Sep 14, 2021 | Business Litigation

Utah business owners like you know the importance of protecting your company as much as possible. You have undoubtedly created various legally binding contracts in hopes of better ensuring that your company does not face undue risk when dealing with partners, employees, vendors or other outside parties. However, even these protections are not infallible.  

Despite your best efforts to ensure the following of contracts, you cannot fully control the actions of another party. As a result, the possibility exists that someone you enter into a contract with could violate the terms of the agreement and leave you in a precarious position. Fortunately, you could take action to address the issue. 

How can you deal with a breach of contract? 

When someone does not adhere to the terms of a legally binding agreement, they have committed a breach of contract. In most cases, a breach can have consequences that allow the nonbreaching party to pursue compensation for damages. The manner in which you carry out that pursuit will likely depend on the severity of the breach and the willingness of the other party to address the matter effectively. 

Some common steps involved with addressing a breach of contact include the following: 

  • Identifying the terms of the contract that the other party has breached and how the breach occurred 
  • Sending a demand letter to the breaching party to explain the breach and the obligation that the breaching party has of fulfilling the terms of the contract 
  • Detailing in the demand letter how you would like to resolve the issue before taking the matter to court 
  • Going through mediation in an attempt to resolve the issue if the breaching party does not follow the suggestion provided in the demand letter 
  • Filing a lawsuit and moving forward with litigation if mediation proves unsuccessful 

Litigation is often the last step because it can be time-consuming and costly. However, if other attempts to have the breach addressed do not resolve the matter, a lawsuit may help your company work toward the compensation it deserves. 

Protecting your business 

Though the contract you entered into may not have prevented someone else’s wrongdoing as hoped, it could still help protect your company in the long run. If your matter goes to court, you can use the contractual agreement as evidence that the other party had a legal obligation to your company. Gaining information on how you can use this and other details as supporting evidence in your case may prove useful.