When conducting any type of business venture, having a contract is a must. These agreements can be verbal or written, but it is typically more advisable to have a written record of any business dealings. In particular, having a written contract may act as better evidence in the event that the other party involved violates the terms of the agreement.
Even with a written agreement, there is no complete guarantee that the other party will abide by the terms. As a result, your company could experience setbacks or other damages, some of which could be seriously detrimental to the company. In such a situation, you may need to decide whether taking legal action is necessary.
What type of contract breach took place?
Yes, there are different types of contract breaches. If the other party breached the contract in a way that did not cause much harm to the overall business relationship or transaction, a minor or non-material breach likely took place. Often, non-material breaches do not present much cause to pursue legal action. After all, the slight is often minor enough that the company can continue on with the venture without any lasting negative repercussions.
On the other hand, the other party could commit a major or material breach. In such a case, your company could experience serious damages. For example, if a client or customer fails to pay you as stipulated by the terms in the contract, you may not have the ability to pay your employees, vendors or other parties. As a result, your company could suffer serious harm due to the client or customer’s nonpayment. If so, you may have to file a legal claim in efforts to obtain the owed money.
How can you know which took place?
In some cases, whether a major or minor breach occurred may not be completely obvious. You may feel that a serious breach took place, but it may be necessary to go over the details to fully ensure that legal action is the right course to follow. Luckily, if you believe that another party breached the terms of your contractual agreement, you can enlist the help of an experienced business law attorney.
Your legal counsel could go over the terms of the contract, assess the circumstances under which the breach occurred and explain your available options. If you should decide to pursue litigation, your Texas attorney can assist you throughout the process.