Businesses commonly enter into contracts with other parties .
These contracts have terms and conditions that bind the parties in specific obligations.
When one of the parties fails to perform their obligations, it becomes a breach of contract under the law. In case of non-compliance with a contract, the other party will suffer damages and can file a claim for compensation against the other.
A business can have many types of contracts with customers, suppliers, employees, sub-contractors, etc.
A business lawyer can help you file a claim against a party who committed the breach and hold him accountable.
Are you having a problem with non-compliance with a contract? Are you concerned that the other party will breach the contract?
Find a business lawyer to understand your rights and protect them. Compare lawyers from the JuriGo network using our short online form.
Different Categories of Breach of Contract
Cases concerning breach of contract fall under different categories:
- Actual breach: The failure of one party to comply with the terms of the contract.
- Anticipatory breach: A type of breach wherein the other party knows he cannot fulfill the terms of the contract.
- **Minor breach-**The other party cannot fulfill a minor contractual obligation. The job as indicated in the contract has been accomplished.
- Material breach: The contracted party has performed the job but the outcome is not the same as expected.
It can be difficult to pinpoint the type of breach in your case. A good business lawyer can evaluate the details of the contract and file an appeal with the court in Ontario.
How to calculate damages from a breach of contract?
Ontario courts allow appellants to claim monetary damages for breach of contract. You will need to show the court that the defendant has performed a breach.
The calculation of damages is based on the nature of the agreement and the breach. Many contracts already stipulate the damages in case of a breach of contract.
Whereas the contract is concerned with the provision of goods or services, the court verifies the value of the goods. The plaintiff must have suffered a loss due to the breach of contract.
Factors to consider when filing a claim for breach of contract
When filing a lawsuit for breach of contract in Ontario, you need to take the following into consideration:
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Verify that you have executed a legal contract or agreement
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Confirm that the other party has violated an important term or condition
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Prove that the breach has resulted in a loss on your part
Talk to a qualified business lawyer in Toronto, Ottawa, Mississauga, Sudbury, Windsor, or anywhere you are located in the province.
Lawyers in the JuriGo network can assist you in claiming damages. All you need to do now is to fill out the short form on this page to get connected to a business lawyer near you.
Written, Verbal, and Implied Contracts
A contract is a written or verbal agreement for business transactions. The right to enter into a contract includes various steps – offer, acceptance, price, and even rejection of a contract. It must also be on equal terms.
A written contract stipulates the nature, terms, and conditions of the agreement, including penalties in case of a breach of contract. In most cases, timelines are also included for the delivery or completion of the agreement.
Businesses should use written contracts so that in case of a breach, it becomes easier to prove.
Contracts are generally drafted by business lawyers to ensure they comply with legal standards.
A common misconception is that if an agreement is not in writing, it is not legally binding. As long as an offer is made and is accepted with clear terms, a verbal contract is enforceable.
Why do lawyers recommend that contracts be written, signed, and sealed?
Even though it is not required as verbal contracts are legal, having a written contract eliminates ambiguity. From an evidentiary perspective, verbal agreements are harder to enforce such as in hiring employees.
The bottom line is to be careful when engaging in verbal agreements.
Implied contracts: Are they binding?
How do implied contracts work? Contracts wherein the parties agree mutually to negotiated terms expressed in actions rather than words are referred to as implied contracts.
For instance, when a person buys a drink at a store, he gives payment to the cashier. They don’t need to sit down and negotiate terms or draw up a contract to complete the transaction. Their agreement is implied by their actions.
Agreements covered by the Consumer Protection Act
The Consumer Protection Act covers agreements in writing such as:
- Agreements involving more than $50 for goods or services;
- Future performance agreements: When a customer must wait for a promised delivery date
- Personal development services agreements: for training (fitness, health, gym membership, and nutrition), talent or modeling services, martial arts, dance, sports, etc.
For personal development services agreements, the rules are not applicable if you were not required to pay in advance.
You must show evidence of the contract and identify the nature of the agreement.
For written contracts, the details are clear and allow a breach of contract claim to be proven more easily. In the case of verbal contracts, proving a breach is harder as supporting evidence may not be sufficient.
Remedies for Breach of Contract
Legal remedies are available for those who suffer losses due to a breach of contract.
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Damages– The victim can claim compensatory damages and punitive damages. The breaching party can be ordered to pay an amount for compensation. Small, token damages are called nominal damages and are not related to financial losses. Liquidated damages are clauses in contracts as intangible or hard-to-define losses to one of the parties. They are pre-estimated and indicated in the contract in case of a breach.
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**Specific Performance-**A plaintiff can claim this remedy if the agreement issue is unique and the damages are not sufficient to compensate the aggrieved party.
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**Cancellation/Restitution-**These are damages that are intended to strip the breaching party of any gains from a breach of contract.
If the value of your claim is $35,000 or less, you must file with the Small Claims Court.
Get a small business lawyer to help you deal with your case. A reliable lawyer will act as your representative in a breach of contract lawsuit.
Whether you have an issue with an employment contract, a commercial contract, a real estate contract, or a verbal agreement , you can claim compensation and protect your rights.
Breach of contract in Small Claims Court
If a business or individual forms a contract with another party, it is expected that both shall honor the agreement.
Failure to do so results in a breach wherein a lawsuit may arise. One party may have a different interpretation of the contract. Thus, before starting a lawsuit, it is best to review the likelihood of success before starting a legal action.
The Small Claims Court has the power to order compensation or to order the return of property.
In a breach of contract, the complainant generally wants the judge to order the other party to fulfill the obligation (called specific performance). This remedy is not possible with the Small Claims Court. Rather, the court may order the party in breach to pay a sum of money to compensate for losses.
Other remedies include actual damages or claims intending to recover money paid out-of-pocket as well as general or stress damages. Punitive damages are also possible if the breach was done maliciously or in a manner that the court finds egregious or offensive.
Before starting a lawsuit, it is best to get legal advice from a business lawyer to review the merits of the case and its likelihood of success. It is imperative to have a sound legal strategy as there are always twists and turns even in a straightforward case.
Connect with business lawyers handling breach of contract cases in your area by filling out the short online form on this page.
Verbal Employment Agreements in Ontario
Employment relationships depend on an employment agreement, written or verbal.
If a worker starts employment in the absence of a written contract, it becomes an implied employment agreement. The terms and conditions of an implied contract are subject to the Employment Standards Act and the Human Rights Code. For instance, under the Employment Standards Act, an employee who is not a manager has the right to overtime pay and reasonable notice in case of dismissal without cause.
If a dispute arises between an employee and an employer regarding the terms of a verbal employment agreement, the burden is on the party asserting the verbal contract. He must prove that a clear offer and acceptance were present in the agreement.
The outcome is not guaranteed and credibility plays a vital role. The best way to avoid such uncertainty is to execute a written employment contract.
What to do in case of a breach of contract?
Under the law, a violation of a contract is a breach and can be subject to legal action. It means one of the parties failed to perform an obligation or did something wrong. It is grounds for a civil lawsuit whether the contract was written or verbal.
Big and small businesses in Ontario face situations of breach of contract. Consult an experienced Ontario lawyer today to know your legal options.
Do I need a lawyer to deal with a breach of contract?
An experienced lawyer can help you evaluate the contract and check if there has been a breach. The lawyer can also guarantee that your rights are respected.
- Reputable lawyers can help you in civil litigation andsituations concerning employment law, landlord, real estate, contractor, supplier, or seller.
- After reviewing the details of your case, a lawyer will find the evidence necessary to strengthen your case. He will also attempt to resolve the dispute with the other party to see if the problem can be mediated and avoid going to court.
- In many cases, hiring a lawyer gives you an advantage because the losing party usually must pay all or part of the winner’s legal fees and expenses.
- Lastly, most types of claims have a limited time for filing until they become barred.
Find the right lawyer for your claim today and ensure you don’t lose the right to sue by missing time limits. Fill out the short online form below to compare lawyers for breach of contract.
When a breach of contract becomes criminal
In many cases, contract breakers are taken to court. But Canadian Law also includes criminal breach of contract wherein violators can face jail time of up to 5 years.
When does a breach of contract become criminal?
Canada’s Criminal Code makes it an offence to purposely break a contract knowing or having reasonable cause to believe that the action could endanger the lives of others, cause serious physical injury, destroy valuable property, or deprive people of their supply of power, water, or gas, or obstruct transportation facilities.
Any person found guilty can face serious consequences such as imprisonment . The law aims to obligate individuals to honor their contractual obligations and not to cause harm to other people and property damage.
Potential Defenses to a breach of contract
The most commonly-used defences against liability for breach of contract are:
- Enforcement of the contract violates public policy
- It has become impossible to perform the contract because it has become frustrated. For instance, hiring a contractor to repair a house that burns down before the job can be done.
- The contract is not legal or results in the commission of a crime.
- The contract lacks consideration.
- The contract was entered into by fraudulent means.
- The contract limits the amount of compensation for damages.
- The contract has a mutual mistake or something different than what the parties intended.
- The contract has a unilateral mistake which is material to the agreement which the other party knew or should have known
- The parties have agreed to a substitute performance.
- One or both parties lacked the capacity to enter into the contract, for instance, being mentally incompetent or underage.
Defending a claim for breach of contract
If you are defending a claim for breach of contract, it is important to raise several legal defences. It is not enough to just deny the allegation of wrongdoing. You need to respond with credible arguments to justify your position.
Defences to a claim of breach of contract are called “affirmative defences”. It means the party sued for breach of contract has the burden of proving the defence if the case goes to trial.
A good business lawyer can help you with a legal strategy to deny liability such as for material breach.
Find your business lawyer now using our short online form, free of charge and no obligation.
Compare business lawyers for a breach of contract lawsuit in Ontario.
Do you feel you have the right to terminate a contract for a valid reason? Has someone breached a contract that caused financial damage on your part?
Sometimes, agreements are not always clear and the terms could be complicated. Knowledgeable lawyers are essential in ensuring that your rights are protected.
Remember that even a well-crafted contract cannot guarantee that the other party will comply with all the conditions.
At JuriGo, business lawyers with vast experience in contract law can develop strategies to win your case.
Compare business lawyers for a breach of contract lawsuit in Ontario by filling out the short online form below, at no cost or obligation.