Breach of Contract


There is a breach of contract when a party to a contract fails to perform his obligations under the
contract. Examples of such breach are the failure to supply goods or perform a service as agreed.
There are varying degrees of breach, depending on the terms of the contract and the importance of
the terms to the core of the contract. A breach of contract does not automatically serve to
discharge the contract. Each situation depends on the nature of the breach, but a breach of
contract does give the innocent party a number of options to terminate the contract.

The breaches that give rise to such options are express or implied repudiation, where one party can
repudiate the contract as a result of the party in breach failing to perform some terms of the
contract. Repudiation before performance is due is known as anticipatory breach, where the contract
is repudiated before performance is due. Fundamental breach is where the party in breach has
committed a serious breach of a fundamental term or totally fails to perform the contract. The
effect of a repudiatory breach is not always the ending of the contractual relationship. The
innocent party does have a couple of choices: he may treat the contract as discharged by
frustration and bring an action for damages for breach, or he may elect to treat the contract as
valid, complete his side of the bargain and then sue for damages from the other party.


express

                            expresní, spěšný

implied


repudiation

                            odmítnutí plnění závazku

anticipatory breach

                            porušení smlouvy před její splatností

fundamental breach

                            porušení závazku opravňující odstoupení od smlouvy

as discharged by frustration