In the World where we are, you cannot do business with a second party without entering into binding legal contracts. You need assurance from other parties that they will pay for the services or goods that you provide or that they will provide the services or good that you pay them to provide to you. Without a contract, the risk of significant business loss is too big.
Unfortunately, business contracts aren’t always honored. When one party fails to comply with the terms of the contract without a legally justifiable reason then the contract is considered to be “breached.”
There are several different ways in which a breach may occur, and these includes:
1.) Material Breach of Contract
A material breach of contract occurs when an individual or a business fails to do what is required pursuant to the terms of the contract. This failure to perform the duties required by the contract leaves the other party without the substantial benefit of the contract agreement. This is considered a serious breach of contract.
2.) Actual or Fundamental Breach of Contract
A fundamental breach of contract, like a material breach of contract, is considered a serious contract violation. A contract is fundamentally breached when one party fails to comply with a term of the contract and that prevents the other party from fulfilling its own responsibilities under the contract.
3.) Anticipatory Breach of Contract
An anticipatory breach of contract typically occurs when the contract contains a date by which something specific must happen. As that date approaches, it may become clear that the completion date will be impossible because work on the contract has not started or has not progressed to the point that would make completion by the contract date feasible.
4.) Minor Breach of Contract
As the name suggests, a minor breach of contract is less serious than other types of contract violations. A minor breach of contract occurs when there is a partial breach of contract. In other words, there was a term of the contract that was breached, but the most important parts of the contract were completed.