Steps to take after a Business Contract has been Breached

Breach Of Contract

When your company enters into a contract with another party—a customer, client, or vendor, for example—both you and the other party are obligated to fulfill the provisions of that agreement. If either party fails to fulfill any of the conditions in the contract, a breach of contract has occurred.

What’s the Next Step After a Contract Breach?

So, after a contract has been breached, what are your options? A breach of contract allows for legal action to enforce any contractual requirements or start the recovery process for money lost as a result of the breach. But is it necessary to go that far? Maybe, but maybe not. Following is a list of things to do if the other party breaches its agreement

Keep the lines of communication open.

It’s usually the most practical and cost-effective solution to contact the other party after a contract breach has occurred. In some situations, the other party may be unaware they have broken the contract. There may be a payment issue that can be resolved before getting legal help if you negotiate with the other person yourself or through an attorney.

Alternative dispute resolution (ADR) is an option.

Not all contract breaches are destined to go straight to court. If the matter can potentially be resolved through alternative dispute resolution (“ADR”) (mediation, arbitration or other type of ADR), then that may be a better alternative that saves time and money while keeping the details of the breach confidential. Because the ADR process is less oppositional than suing the other party, it may help your business maintain a relationship with the other party.

Know what you’ve lost.

Whether you resolve your breach of contract problem amicably, via ADR, or litigation, you must accurately calculate your losses. Contract breaches generally result in monetary losses as well as intangible damages such as wasted expenses and lost profits. Finding out how much money you are entitled to recover and then proving it will be critical to having a successful case.

Act quickly.

In Arizona, the statute of limitations for breach of written agreements is 6 years, but it’s just three years for verbal contracts. If you wait too long to take action after a contract violation, you risk running out of choices.

Be ready for a lawsuit, if necessary.

Once all possible resources and non-litigation methods have been attempted to resolve the contract breach without success, your only feasible choice will be to file a lawsuit to regain everything you lost. For expert legal counsel, you need to contact Anthony Law Group, which have experienced Phoenix business litigation attorneys who specialize in commercial disputes.

Schedule a Consultation today with a Anthony Law Group

In a utopian business world, contracts between your company and your clients are executed without a hitch. Both parties enter the contract feeling good about its terms, both benefit from having the contract in place, and everyone involved is happy with the outcome. Disputes are not even an afterthought. But the reality is far different. Financial problems arise, delays occur, and unforeseen circumstances can all cause dreaded contract breaches, leaving you wondering, “What’s next?” The experienced business litigation attorneys at Anthony Law Group can help. Reach out for a case consultation by calling 602-362-2396 or contacting us online.


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Anthony Law Group

Anthony Law Group