Contracts are the foundation of doing business with clients, customers and other companies. These agreements involve costs, deliverables, deadlines, and what happens when the contract’s conditions are not met. Using valid contracts means that a business can make promises to others knowing that they have a contract that guarantees necessary material, which they can turn around and provide deliverables to customers. It is all interconnected, so one breach of contract where a shipment is late can, in turn, lead to multiple breaches of promises made based on that missed deadline.
What it means to win a civil case
Unless there are criminal actions amid the breached business transactions, plaintiffs filing a business or civil lawsuit seek damages for the harm caused by the breach. Damages may include:
Money: Financial damages are common when filing a breach of contract lawsuit. The defendant who loses their case must compensate for lost income, legal fees, and perhaps punitive damages (such as harm to reputation) that the breach caused the plaintiff.
Honoring the contract: The judge may require the defendant to honor the agreement. Violating the judge’s order leads to contempt of court, which can mean additional fines and criminal charges. It may be a situation where the plaintiff gets financial damages, and the defendant must still do the work.
Terminate the contract: The conditions for the breach may be beyond the defendant’s control, and there was no malicious intent. In such cases, the judge may terminate the contract, thus freeing each party from the agreement.
Return assets: It may be a matter where the defendant accepted money, took control of real property or received goods but could not deliver on their promise. They must return the assets to the plaintiff.
Other important benefits
Some will argue that arbitration or mediation is faster and cheaper than litigation. Still, these formats often seek a middle ground or compromise, which can reward the defendant for not honoring their agreement. Going to court also brings closure because there’s a judge’s ruling at the end of it (unless the two parties settle before the end of the trial). The willingness to litigate may also set a precedent where others with contract agreements with the plaintiff may choose to honor their deal, knowing that they will go to court if they don’t.
Each agreement is different. Those considering litigation should discuss the matter with an attorney who regularly represents clients in court. They can look at the case’s details and provide the client with an analysis based on knowledge and experience.
