General Breach of Contract

• A breach of contract occurs when a party to a contract fails to perform its end of the bargain. This could be done either through behavior adverse to the execution of the contract or through a failure to act at all. A breach of contract may be anticipatory or actual. Under anticipatory breach, the defaulting party to a contract announces a decision not to fulfill its end of the contract. In actual breach, the recalcitrant party bluntly refuses to or fails to perform its part of the contract as stated under the terms of the contract.
  
  

Breach of Contract Under Common Law

• Under common law, the remedy for a breach of contract is damages. However, under certain circumstances, a party to a contract may terminate a contract. For example, renunciation describes the refusal of a party to a contract to perform its legal obligation. This refusal may be express or implied by the conduct of the defaulting party. Breach of condition is a repudiatory breach where the defaulter breaches a condition upon which the contract is contingent. A fundamental breach is a breach where the party totally fails to perform its side of the contract. There are two common-law options for a breach of contract. A party may fulfill its side of the contract and sue for payment, or the party may treat the contract as discharged and sue for breach of contract.
  
  

Damages

• Certain considerations govern the award of damages under common law. These damages are usually in the form of monetary awards, which serve as compensation for the loss suffered by the innocent party to a contract. Before any damages can be awarded, the innocent party has to demonstrate that an actual loss has occurred as a result of the actions, or lack of action by the defendant.
  
  

Conditions for the Award of Damages

• The court considers two things when deciding whether a party has suffered damages: remoteness of loss and the measure of damages. Remoteness of loss refers to the damages that can be "considered to arise naturally from the breach of contract." Another consideration for remoteness is the things that may have been reasonably assumed to be the possible result of a breach during the contract. This expectation is implied and it does not matter if the defendant expected it or not. While assessing the amount of damages the innocent party is due, the court considers the position the innocent party would have been in if the breach had not occurred.