Understanding some common outcomes for a breach of contract case can help you understand what to expect. A breach of contract occurs when one party fails to fulfill their obligations under a legally binding agreement. When this happens, the non-breaching party has the right to seek remedies through negotiation, mediation, or litigation. In Oklahoma, courts handle breach of contract claims by considering the terms of the agreement, the nature of the breach, and the damages suffered by the non-breaching party.
Monetary Damages
One of the most common outcomes for a breach of contract claim is an award of monetary damages to the non-breaching party. The purpose of damages is to place the injured party in the position they would have been in if the contract had been fully performed. There are several types of damages that may be awarded, each of which are calculated differently:
Compensatory Damages
Compensatory damages cover actual financial losses suffered as a result of the breach. These damages may include:
- Lost profits
- Costs incurred due to the breach (e.g., purchasing replacement goods or services)
- Expenses for mitigating the breach
For example, if a contractor fails to complete a construction project, the homeowner may recover the cost of hiring another contractor to finish the job.
Consequential Damages
Consequential damages, also known as special damages, cover indirect losses that occur as a result of the breach. These damages must be reasonably foreseeable while creating the contract.
For instance, if a supplier fails to deliver critical parts on time, causing the buyer to lose a major client, the client may claim the lost profits as consequential damages.
Liquidated Damages
Some contracts include a liquidated damages clause, which specifies a predetermined amount of damages to be paid in the event of a breach. These clauses are enforceable as long as the amount is reasonable and not considered a penalty. For example, a construction contract may require the contractor to pay $500 for each day they delay the project.
Nominal Damages
In some cases, the court may award nominal damages if the breach occurred but the non-breaching party did not suffer any significant financial loss. These damages are symbolic and typically involve a small monetary award.
Rescission or Reformation of the Contract
Rescission is a remedy that cancels the contract and restores both parties to their original positions as if the contract never existed. This remedy is often for cases where the breach is substantial and continuing the contract would cause undue hardship to the non-breaching party.
Rescission may also be appropriate if the contract was formed under fraud, duress, or misrepresentation. For example, if one party was misled into signing a contract based on false information, the court may allow rescission of the contract to void its terms.
In some cases, the court may order reformation of the contract. This remedy involves modifying the terms of the contract to reflect the true intentions of the parties. Reformation is typically for when there is a mistake or ambiguity in the contract that led to the breach.
For instance, if a contract contains an error in a key provision, such as pricing or delivery terms, the court may reform the contract to correct the mistake and prevent future disputes.
Mediation or Settlement
Many breach of contract disputes are resolvable outside of court through mediation or settlement agreements. Mediation involves a neutral third party who helps the parties negotiate a resolution. A settlement may involve payment of damages, contract modification, or other mutually agreed-upon terms.
Settlement is often beneficial because it:
- Reduces legal costs
- Saves time
- Preserves business relationships
Reaching a settlement can be a practical solution for both parties, especially in cases where ongoing relationships are important.
Attorneys’ Fees and Court Costs
In some cases, the court may order the losing party to pay attorneys’ fees and court costs. This is typically allowable if the contract contains an attorneys’ fees clause, or if state law provides for fee-shifting in specific cases.
When to Pursue a Breach of Contract Claim
Deciding whether to pursue a breach of contract claim depends on several factors, including:
- The extent of the damages suffered
- The likelihood of success in court
- The cost of litigation versus potential recovery
- The availability of alternative dispute resolution options
Consulting with an attorney can help you assess your case and determine the most effective strategy for resolving the dispute.
Tulsa Breach Of Contract Attorneys
Common outcomes for breach of contract cases include monetary damages, specific performance, rescission, reformation, and settlement agreements. The outcome of each case depends on the facts, the terms of the contract, and the remedies sought by the non-breaching party.
If you are considering legal action for a breach of contract in Oklahoma, contact the Tulsa business law attorneys at Kania Law Office by calling us at (918)–743-2233 or online.
Tulsa's Local Lawyers
Are you looking for Tulsa attorneys who will fight aggressively for you? Our team of attorneys have the experience needed in Oklahoma law to secure the outcome you deserve.
Call us today for a free consultation 918-743-2233 or contact us online.