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Broken Contract: Instances That Can Cause Breach of Contract

When a contract has been broken a breach of contract is said to have occurred; breach of contract in legal terms is used to describe actions that has been undertaken by one of the parties in contravention to the binding agreement as originally agreed between the parties (Benzvi, 2009). There are three instances that the law recognizes as factors that can cause breach of contract. One, a breach in contract occurs where one of the party’s actions means that other parties to such a contract are unable to perform. Secondly, the law states that a breach of contract occurs where one of the parties refuses to completely discharge duties as required. Finally, a contract has been breached where one of the parties undertakes actions that are not in accordance to the “intent of the contract” (LectricLaw.com, 2008). Based on these conditions we can thus determine that the refusal by Jersey Shore Inc refusal to honor payments as of 1 April would amount to a breach of contract because they would be contravening the original terms of the contract.

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Having determined that let us now discuss the other issues of the case; there are four categories that list all the types of contract breach between parties: minor breach, material breach, fundamental breach and anticipatory breach (LectricLaw.com, 2008). Anticipatory breach is the branch that is relevant to our case because it refers to a contract breach that is expected to occur in future and imminent which the law allows any of the parties to undertake contingent actions such as sue. In practice what this mean is that Landis Lubber is allowed by the law to sue Jersey Shore Inc before they actually breach the contract under the grounds of anticipatory breach. This now brings us to the issues of remedies to both parties that would result from Lindsay suing the Incorporation. When a contract has been breached a court of law would provide for either of the following; rescission or damages (Yovel, 2008). Damages is when the court imposes a fine to the party who has contravened the terms of the contract payable to the other party where there is clear evidence that the terms of the contract has been breached for no good reasons. In this case the mitigating circumstances for Jersey Shore Inc would make it unlikely for the court to enter such a decision.

On the other hand rescission is when the court severs the responsibilities of the contract for both parties and nullifies the contract; this is what is likely to happen since the intention in this case is to revert both parties to their original financial condition that existed before the contract had been implemented. On the other hand Jersey Shore Incorporation can raise two issues of mitigation as their defense; frustration or termination for a breach of contract (Gibson, Rigby and Tamsitt, 2005). Frustration refers to where a party to a contract terminates the agreement because in the process of finalizing the contract a certain law is enacted which makes it illegal to purchase the expected product which in this case is the piece of land. Termination for a breach of contract is another ground that Jersey Shore Inc can also cite because it is obvious that they will not receive the parcel of land even after the parcel of land has been fully paid for.

Finally, Lindsay should have a clause in the effect that the environmental enthusiast cannot opt out of the contract should the status of the land change in anyway and that such actions would result in forfeiture of the already paid amount in addition to payment of damages. An example of such a clause could be “the buyers binding to this agreement is not dependent on the status of the land or any other condition at all, and in the event of breach of this contract for such reasons the buyer will forfeit all paid money so far in addition to $200,000 fine payable as damages provided that the total does not exceed the cost of land”.

References

Benzvi, K. (2009). Contract Law 101 (Part IV): Breach of Contract and Remedies. Web.

Gibson, A., Rigby, S. and Tamsitt, G., (2005). Commercial Law: In Principle. 3rd edition, Sydney: Thomson Law Book Co.

LectricLaw.com. 2008. Nonperformance and the Breach of Contract. Web.

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Yovel, J. (2008). Contract Law, Otto-graph.com. Web.

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StudyCorgi. "Broken Contract: Instances That Can Cause Breach of Contract." April 6, 2022. https://studycorgi.com/broken-contract-instances-that-can-cause-breach-of-contract/.

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StudyCorgi. 2022. "Broken Contract: Instances That Can Cause Breach of Contract." April 6, 2022. https://studycorgi.com/broken-contract-instances-that-can-cause-breach-of-contract/.

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StudyCorgi. (2022) 'Broken Contract: Instances That Can Cause Breach of Contract'. 6 April.

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