If someone has breached a contract with you, the first question is not necessarily whether you should take them to court. You need to understand what the contract says, what you want the other party to do and what steps will put you in the strongest legal and commercial position.
You may want the breach remedied, payment made, work completed, defective services corrected or the contract brought to an end. In other cases, the priority may be compensation or negotiating a commercial solution without the cost and uncertainty of litigation.
Our breach of contract solicitors act for businesses and individuals making and defending contractual claims. We can become involved at any stage, from reviewing the contract and advising on your options through to serving notices, negotiating a settlement or conducting court proceedings.
How we can help
Getting advice early can be particularly important. What you do after a breach can affect the options available later, particularly if you are considering terminating the contract or continuing to perform it while the dispute remains unresolved.
We can help you:
Assess whether there has been a breach – reviewing the contract, relevant correspondence and what has actually happened.
Decide what outcome to pursue – whether that is payment, performance of the contract, correcting defective work, compensation, renegotiation or bringing the relationship to an end.
Demand that the breach is remedied – clearly setting out what the other party needs to do and the consequences if they fail to do it.
Serve contractual notices – ensuring notice requirements, methods of service and contractual timescales are properly followed.
Advise on termination and repudiatory breach – including whether you have the right to terminate and the risks of doing so incorrectly.
Protect your position if the contract continues – including reserving your rights where appropriate.
Negotiate a commercial solution – using open and without prejudice correspondence appropriately and exploring settlement before substantial costs are incurred.
Prepare or respond to a letter before claim – formally setting out the legal position and what is required to resolve the dispute.
Assess whether litigation is commercially worthwhile – considering the merits, likely response, costs, recoverability and enforcement risks.
Issue or defend court proceedings – where the dispute cannot be resolved and litigation is justified.
We act for both claimants and defendants, giving us practical experience of the arguments, tactics and commercial pressures that can arise on either side of a contractual dispute.
Where appropriate, we can also offer fixed fees for particular stages of a dispute, allowing you to obtain advice or take a specific step without necessarily committing to the costs of full litigation.
Types of breach of contract
Minor breach – a breach which is not sufficient to give the other party the right to terminate, but instead will generally result in a demand for the breach to be remedied, and potentially claim damages (see below)
Material, fundamental or repudiatory breach - significantly impacts the contract's purpose or sometimes described as going to the heart of the contract, leading to the party not in breach having the option but not the obligation, to terminate the agreement.
Anticipatory breach - occurs when a party declares beforehand their intention to not perform their obligations.
Commercial and legal considerations after breach
The right approach depends on the contract, the seriousness of the breach and what you are trying to achieve. However, the usual starting points include:
Check the contract – establish what each party agreed to do and whether there has actually been a breach. Check payment and performance obligations, timescales, notice requirements, termination provisions, liability clauses and any dispute resolution procedure.
Get legal advice early – particularly before terminating the contract, stopping your own performance or taking another significant step which may be difficult to reverse.
Decide what you want to achieve – you may simply want the other party to comply with the contract. Alternatively, you may want payment, defective work corrected, a commercial compromise, compensation or to end the contractual relationship.
Demand that the breach is remedied – clearly identify what has gone wrong, what the other party needs to do and by when. The contract itself may specify a period within which certain breaches must be remedied.
Serve any necessary contractual notice – the contract may specify exactly how notice must be given, who must receive it and where and how it must be served.
Consider whether you can or want to terminate – a sufficiently serious breach may entitle you to accept the breach and bring the contract to an end. However, not every breach gives a right to terminate and there may also be commercial reasons for keeping the contract alive.
Preserve your rights – if you continue with the contract while trying to resolve the problem, consider whether you need to make clear that you are reserving your rights.
Preserve the evidence – keep the contract, amendments, emails, messages, invoices, payment records, meeting notes and other evidence showing what was agreed and what subsequently happened.
Assess whether a claim is commercially viable – having a valid legal claim does not necessarily mean pursuing it is worthwhile. Consider the value involved, evidence, likely defence or counterclaim, costs and whether the other party is likely to be able to pay.
Anticipate any potential defences or counterclaims - before going down the full legal route, think about whether the other party might seek to fight a claim and if so, in what why, however spurious you may think that is.
Remedies for breach of contract
Termination - where the breach is a fundamental or repudiatory breach, you may have the option to terminate the contract and walk away from it. This is often not as straightforward as it seems legally, especially if the breach is not expressly defined as a repudiatory breach in the contract..
Specific performance - seeking a court order demanding the other party fulfill their contractual obligations. This is not a standard remedy and is an equitable remedy, meaning it is in the court’s discretion as to whether the remedy is practicable, fair or appropriate.
Damages – claiming compensation for the losses you have suffered due to the breach - see our detailed guide to damages, what's claimable and how they are calculated.
Injunction - a court order preventing the other party from continuing their breach or compelling them to take action. Injunctions are not a standard remedy, are difficult to obtain and are expensive and risky applications.
Consider renegotiating the contract - evaluate the severity of the breach and its impact on your business, your leverage and the other party's willingness to renegotiate. Clearly communicate your expectations and demands during the negotiation process. Keep detailed records of all communications and agreements.
Work out what you can realistically claim before starting any court claim
The appropriate remedy depends on the contract and nature of the breach. You may be seeking payment, performance of a contractual obligation, termination, an injunction or damages.
Damages are not automatic simply because a breach has occurred. Issues including causation, foreseeability, mitigation and contractual limits on liability can affect what can ultimately be recovered.
See our separate guide to breach of contract damages for more detail on how compensation is assessed and what losses may be recoverable.
Contact us
Every breach of contract situation is unique, and the most suitable approach will depend on the specific circumstances and assessment of merits/risks/costs. This is where our experience is valuable to you, together with having a clear strategy and plan. We can often offer a fixed fee for each stage of the dispute, giving you clarity and control over costs.
Please do get in contact to discuss your contract breach situation and how we can help.
