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How to avoid Breach of Contract?

If you have ever done a deal with someone and they don’t live up to their end of the deal, you have experienced breach of contract!

Business Dispute

The legal definition of breach of contract is: failing to perform any term of a contract, written or oral, without a legitimate legal excuse. This may include not completing a job, not paying in full or on time, failure to deliver all the goods, substituting inferior or significantly different goods, not providing a bond when required, being late without excuse, or any act which shows the party will not complete the work (“anticipatory breach”). Breach of contract is one of the most common causes of law suits for damages and/or court-ordered “specific performance” of the contract.

Well that a mouth full. Let’s break it down.

Failing to perform any term of a contract. Regardless of which side of the contract you are on, Giving or Receiving, you are required to follow through.

Oral or Written. Under this general definition, it doesn’t matter whether the agreement was oral or written, if you do not perform your agreed upon term you are in breach of the contract.

A legitimate legal excuse. If the any of the terms of the contract made the contract unenforceable, the party in breach may have a legal excuse. Enforceable categories are: agreement, consideration and mutual obligation, legality, possibility, and whether is was in writing.

A contract, while it may be written or oral, must be carried out to the fullest by both or all parties.

How to Avoid Committing a Breach of Contract


Contracts are legally binding documents. If the contract is well written by experienced legal representatives;

  • All parties will enter into a contract that they have all agreed to. (agreement)
  • All parties will have some form of consideration or incur some form of obligation to the other parties. (consideration and mutual obligation)
  • All parties will offer and expect consideration or obligation that is legal in nature. (legality)
  • All parties must offer and expect consideration or obligation that are possible. (possibility)
  • All parties must be legal capable of entering into a contract. Minors and individuals with mental illness are often not legally able to be held to the terms of a contract, for the purposes of this breach conversation.

The success rate of a contract to be enforced increases dramatically is the contract is in writing. If you are considering entering into a contract with someone for any sort of business transaction, even if they are a friend or family member, consider the help of a legal representative to go over the contract to reduce your risk of Breach of Contract.

Don Harris and New Mexico Financial Law are highly experienced in New Mexico Business Law and Contract Law. Each state is different. Reduce your risk with the best representation.

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