Breach of Contract
Legal Counsel for Breach of Contract Under Delaware Law
When businesses anywhere in the world enter into legally binding agreements, they often opt into Delaware law by including choice of law and choice of forum provisions in their contracts. This subjects the parties to the personal jurisdiction of Delaware.
Each party is expected to uphold its end of the agreement, and in exchange, each party has the right to expect the other party to do the same. If a party does not uphold its end of the agreement, the business may have the right to file a breach of contract lawsuit in Delaware courts.
The Williams Law Firm is here to assist your business to ensure contracts are followed. Breach of contract litigation enforces the agreements you have entered into with your vendors, customers, and other businesses.
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Generally, a breach of contract occurs when one of the parties to a contract fails to perform completely as agreed and that material breach is both not cured and causes damages. Of course, when the case is in litigation, the contract is put under a microscope, which can result in a court looking to other things, such as correspondence and negotiations before the contract became effective to interpret ambiguities or the course of performance. Also, these actions need to be brought within a statutory period of time.
In Delaware, this is usually three years from the date of a breach, to avoid the claims being time-barred. The facts can also work to shorten this period on other equitable principles. Some contracts “under seal” are subject to a twenty-year statute of limitation as a specialty contract. Under certain situations involving the sale of goods governed under the UCC, the statute of limitations is four years. Other shorter limitation periods may also apply to your particular circumstances, so it is best not to delay.
Discovering More About Delaware Breach of Contract Elements
Delaware Breach of Contract Elements
Explaining contract elements to our clients
While it is always best for contracts to be written down and signed, it is possible to hold another party accountable for a contract that is on a napkin, a handshake, or made orally. Of course, those cases require other types of evidence to prove the terms of the actual contract because parties rarely agree when they become polarized. Sometimes, the terms of an agreement can be changed over time as a result of agreed modifications, waiver, or through acquiescence. Generally, the elements of a breach of a Delaware contract follow the common law.
Breach of contract is more difficult to prove in oral contracts. Additionally, some types of contracts have to be in writing to be enforceable, known as the statute of frauds. For example, real estate contracts must be in writing. For every rule there is an exception, so it is important to know all of the facts, both good and bad, to evaluate the case to determine whether it is worth pursuing or whether alternatives to litigation should be considered. For example, partial performance may be a substitute to a writing signed by the party against whom enforcement is sought.
Another type of breach of contract, called breach of implied terms, focuses on terms that are not part of the express contract, but are necessary to perform the contract. These can be proved by presenting evidence that indicates the course of performance, course of dealings, or industry customs. Plus, under Delaware law, every contract has an implied covenant of good faith and fair dealing. Many Delaware cases have interpreted these different principles to decipher their meaning in different contexts to fill gaps and judge actions after the fact.
Pre-litigation consulting and attempts to avoid court can be worthwhile because litigation should often be the last alternative. You should also consider what the grounds are to challenge jurisdiction, dismiss a case, present affirmative defenses and possible counterclaims, cross-claims, and third party claims. Plus, there is a burden of proof on the party requesting damages that requires admissible evidence be shown to the court before it can rule in your favor. Plus, the judge or jury may not agree with your witnesses or understand your theory of the case. Therefore, working out a deal with the other side is usually preferable to the uncertainty of trying the case.
Breach of contract cases have a few different types of damages that can be awarded. In Delaware, these damages follow the common law. Generally, the policy goal of damages is to require the breaching party to pay an amount that would put the non-breaching party back in the position that it would have been in had the contract been performed as agreed upon. Other times, the goal is to restore the non-breaching party to either a position as if the contract was fully performed or a position of rescission and restitution as if the contract was never entered into. It is almost impossible to get punitive damages in breach of contract cases. It is also difficult to obtain an award of attorney’s fees unless the contract called for fee shifting or if there is bad faith litigation.
Sometimes, a calculation to determine an amount of damages is agreed upon in the contract itself. If this amount is paid by the breaching party, it is known as liquidated damages.
Finally, nominal damages are paid when the non-breaching party did not lose much financially and only wants to ask for a minimal amount to punish the breaching party for breaching the contract.
Breach of contract litigation can become complex if there is a misunderstanding about what the terms of the contract are based on the contract itself or if the terms are difficult to prove because a contract was oral, such as handshake deals. Also, breach of contract cases may be only a small part of a host of other claims related to fiduciary duty breaches. For that reason, businesses need the help of a qualified lawyer when pursuing or defending a breach of contract case. The Williams Law firm is here to help your Delaware business through this process.
Attorneys’ Fees and Damages in Delaware Breach of Contact Cases
The work we do on behalf of our clients
“Injustice anywhere is a threat to justice everywhere.”
– Martin Luther King, Jr.
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