We routinely represent parties in breach of contract claims, either by helping parties enforce their rights when another party has breached a contract or by defending parties against breach of contract claims. In some ways, breach of contract claims can be relatively simple – after all, Party A promised to do a certain thing for Party B but Party A failed to do what it promised. But, in reality, that situation is far more complicated than it first appears because the contract may have conditions, contingencies, implied duties, and implied covenants and conditions. And, even if a breach occurs, the defendant may have defenses or the relief between the parties may be further conditioned and contingent on certain events.
In Virginia, a plaintiff can prevail on a breach of contract claim by providing proof of three elements: “[A] legally enforceable obligation of a defendant to a plaintiff, a defendant’s violation or breach of that obligation, and injury or damage to the plaintiff caused by the breach of obligation.” Ulloa v. QSP, Inc., 624 S.E.2d 43, 48 (Va. 2006). Virginia courts have long respected the freedom of parties to make decisions of their own choosing so long as the parties’ contract does not run afoul of existing law or public policy.
Generally speaking, every enforceable contract contains the following components regarding a contractual transaction:
(1) The identities of the parties, including beneficiaries, sureties, and guarantees;
(2) The rights, obligations, and duties of the parties;
(3) The representations and warranties offered by the parties;
(4) The terms and conditions under which the parties are to perform the contract;
(5) The consideration, or the essence of the bargain between the parties;
(6) Events that will be considered a breach of the contract;
(7) Penalties in the event the contact is breached; and
(8) Remedies for the non-breaching party, including damages, costs, and other relief.
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To be an enforceable, a contact need not be in writing, though certain contracts – those, for example, dealing with a guarantee of another’s debts, those dealing with the sale of real estate, those that are not to be performed in the next year – must be in writing and signed by the party to be charged with performance of the contract’s obligations in order to comply with Virginia’s Statute of Frauds. But even where an agreement between parties does not comply with the Statute of Frauds, it may still be enforceable under certain circumstances if one of the parties to the contract has performed its duties pursuant to the contract.
Even when a breach occurs, the defendant in a breach of contract claim may rely on a number of defenses to justify or excuse the breach. Among other things, for example, the plaintiff may have committed the first material breach of the contract, the plaintiff may have acted with “unclean hands,” the plaintiff may have waived any breach that occurred, the parties may have created the contract while operating under a mutual mistake, the plaintiff may have committed fraud in the inducement, or the plaintiff may have taken advantage of its special confidential relationship with the defendant when making the contract, thus invoking the defenses of duress, unconscionability, or undue influence.
Whether a breach of contract has occurred depends on a number of complicated legal and factual issues, and every case is different. If you or your company have contract issues and you would like to speak with an attorney experienced in contract matters, please contact Bob Byrne at [email protected] or at 434-817-3100.
Robert E. Byrne, Jr., the author of this article, is a trial attorney in the Charlottesville, Virginia office of the law firm of MartinWren, P.C. Named the 2010 Virginia State Bar Young Lawyer of the Year and recognized as a “Rising Star” by Super Lawyers Magazine, Bob practices throughout Virginia representing individuals and companies in commercial and business litigation with an emphasis on intellectual property litigation, and he also represents plaintiffs as a member of the Virginia Personal Injury Lawyers group and the Charlottesville Personal Injury Lawyers group. In addition, Bob devotes a substantial amount of his practice to advising emerging growth start-up companies with their business and contract matters. To contact Bob, please call him at (434) 817-3100 or email him at [email protected].
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