A contract is a legally enforceable agreement between parties, which specifies duties, services or products to be exchanged (plus any related details). When one party fails to fulfill the duties agreed to under the contract terms, this is known as a breach of contract.
A contract can be breached in different ways:
- One party does not perform as promised
- One party prevents the other party from performing the duties of the contract
- One party indicates the intention of not fulfilling the contract duties
When one party breaches the contract, the other party, who has fulfilled the terms of the agreement, is entitled to various remedies. Awarding of damages is one common remedy; generally these take the form of monies paid by the breaching party to compensate the other party for losses and other expenses connected with the breach.
There are several types of damage awards:
- Consequential damages. The breaching party pays the non-breaching party an amount that puts the non-breaching party in the same position as if the contract had been fulfilled.
- Punitive damages. The court requires the breaching party to make a payment as a punishment for the breach of contract.
- Liquidated damages. This is a pre-determined sum, written into the contract, to be paid by the breaching party in the event that a breach occurs.
- Nominal damages. A minimal amount paid to the non-breaching party if that party won the case but did not incur financial hardship due to the breach.
Each state varies as to the period of time in which a breach of contract lawsuit must be filed. In Arizona, the statute of limitations takes into consideration the type of contract:
- Breach of oral contract: 3 years
- Breach of written contract executed within Arizona: 6 years
- Breach of written contract executed outside Arizona: 4 years
- Breach of contract for sale: 4 years (as specified by the Uniform Commercial Code)
Contract law as well as breach of contract lawsuits can be complex in nature; so an experienced breach of contract attorney can be an essential resource.
If you would like more information about breach of contract, or if you need assistance from an attorney, contact Windtberg & Zdancewicz to schedule an initial consultation.
The attorneys at Windtberg & Zdancewicz, PLC, provide clients with experienced legal representation in all collection matters. We are experienced in creditor’s rights including garnishments, charging orders, attachment, property execution, trustee’s sales, foreclosures, judgments, judgment collection, domestication of foreign judgments, and creditor’s issues in bankruptcy cases. If you need assistance with your collection matters, please contact us at (480) 584-5660.