Breach of contract refers to a violation or failure by one party to a legally enforceable agreement (contract), by not performing their part of the obligations as agreed, without lawful excuse. It is a civil wrong, not a criminal offence, and is governed by contract law. Governing Law in India: The Indian Contract Act, 1872 (still in force and not replaced by BNS, BNSS, or BSA). Civil remedies are available through civil courts, not criminal courts. What Constitutes a Breach of Contract? A breach occurs when: A party fails to perform any promise in the contract. There is a delay in performance. The performance is defective or incomplete. A party refuses to perform their obligation altogether (repudiation). Types of Breach of Contract: 1. Actual Breach Happens when a party fails to perform their duty on the due date or during performance. 2. Anticipatory Breach Happens when one party declares in advance that they will not fulfill the contract. Examples: A builder agrees to complete a house by January but stops work midway — actual breach. A seller tells the buyer in advance that they won’t deliver goods as agreed — anticipatory breach. Legal Consequences of Breach: When a breach occurs, the aggrieved party (non-breaching party) has the right to seek: 1. Damages Compensation for the loss suffered due to the breach. Can be general damages or special damages, depending on the case. 2. Specific Performance Court orders the breaching party to perform their part of the contract (used in real estate and unique goods cases). 3. Injunction A court order restraining a party from doing something that breaches the contract. 4. Rescission The contract is cancelled, and both parties are released from further obligations. 5. Restitution The party who received a benefit must return or compensate for it. Essentials to Prove Breach: To bring a legal claim, the aggrieved party must show: There was a valid contract. They fulfilled their obligations or were ready to do so. The other party failed to perform without justification. There was a loss or damage as a result. Remedies Through Court: The aggrieved party must file a civil suit in a competent court. Limitation period for filing a breach of contract suit is 3 years from the date of breach (as per the Limitation Act, 1963). Not a Criminal Offence: Breach of contract is a civil wrong, not a crime. However, if fraud or cheating is involved, criminal liability under BNS (replacing IPC) may arise, but only in exceptional cases.

Dear Client, A party to a legal agreement breaks a contract which they are a part of by not performing the terms they agreed to which they had no legal right to do so. In fact it is against the terms of the contract. This may include:. Non-performance: A basic type of breach in which a party does not perform what they said they would do as in a supplier’s failure to deliver goods. Late performance: A party fulfills their duty but fails to meet the deadline set out in the contract. Defective or inadequate performance: A group may put on a show which does not deliver as per the terms that were set out and agreed. Anticipatory breach: In some cases one party may put forth that they will not fulfill their responsibilities before it is time to perform and at that point the other party may go ahead with whatever steps necessary instead of waiting for actual breach to take place. Types of Breaches Breaches also fall into categories by their severity:. Material Breach: This is a serious issue which goes to the heart of the contract. We are talking of a large scale here which in fact the non breaking party was not made to enjoy what the agreement was meant to bring. Also what this does is give the damaged party the right to end the contract and take the other party to court for what they put them through. Minor (or Partial) Breach: This is a breach of a minor nature which does not affect the primary purpose of the contract. The non breaching party may still receive what they are due under the agreement but we may see the award of compensation for any issues raised by the minor breach. Legal Consequences and Remedies In the event of a broken contract we see that the non-breaching party has legal action available to them. The main aim of that action is to place the non-breaching party in the same economic position as if the full terms of the contract were carried out. Which includes but is not limited to:. Damages: The usual remedy which is for the breaching party to pay a monetary sum to the non-breaching party which that party has lost. Specific Performance: A court will issue an order which forces the defaulting party to live up exactly to what was put forth in the contract. This is a common remedy in a situation where the subject of the contract is unique (i.e. real estate). Rescission and Restitution: The agreement is voided and parties return to what they were before the contract was put in place. Note that this is a general overview. In detail the particulars of contract law may vary greatly by jurisdiction and the terms of the individual contract. For legal advice concerning a specific contract or dispute, it is highly recommended to consult with a qualified legal professional. Thank you!