breach of contract(redirected from material breach)
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Breach of Contract
breach of contract
A violation of some or all of the terms of a contract. Most contracts spell out specific remedies in the event of breach, but include a basket granting any and all other remedies allowed at law or equity.Some states have statutes making defaulting parties liable for the attorneys' fees of the other side;other states do not have such laws and attorneys'fees are recoverable only if that right is granted in the contract.
• In a real estate context, some purchase contracts provide that a breaching buyer will lose his or her earnest money but not be responsible for any other damages. If not so specified as a limitation on damages, then a breaching buyer is fully responsible for all the seller's damages, which could include losses when the property is sold for a lesser amount, costs of remarketing the property, attorneys' fees, and possibly even consequential damages such as the seller's loss of opportunity to purchase something else. In extremely rare cir- cumstances, the seller can obtain an injunction forcing the defaulting buyer to proceed with the purchase.
• If the seller defaults, the buyer may apply for an injunction to order the seller to proceed with the sale. This unusual remedy is because the law says that real property is so unique that money damages can never compensate one for its loss—only the property itself will suffice. Despite that, buyers may waive this remedy of specific performance and seek dam- ages instead. Under some circumstances they may receive both.