Contractual Disputes

A contract can be written or oral (or both). Where the obligations of the parties set out in a contract have not been met, this can result in the aggrieved party having a potential claim for breach of contract.

Other contractual disputes include challenging unfair terms within an agreement and raising issues surrounding improper incorporation of contractual terms within the contract.

 In order, for there to be a binding contract, there must be:

1. An offer.
2. An acceptance.
3. Consideration (i.e. the giving of some value (this does not have to be monetary and could be an incurrence of a detriment) in exchange for the goods and services to be supplied.
4. Intention to create legal relations.
5. Certainty of terms.

Contractual disputes can arise out of one of the above five component parts not being satisfied.

Where a party has failed to comply with either the express or implied terms of the contract, an aggrieved party may have a claim for breach of contract. Example of breach of contract claims include the following:

1. Failure to pay the invoice in relation to goods or services. (See also our Debt Claims section).
2. Failure to provide services within a reasonable time or with reasonable care and skill.
3. Failure to provide goods which are of satisfactory quality or where they do not match the description.
4. A failure to install goods correctly.
5. Bulk supply of goods does not match the sample.
6. A failure to comply with a confidentiality clause.
7. A failure to comply with a restrictive covenant.

 A claimant may seek the following remedies where there has been a breach of contract:

1. Unliquidated damages – This compensates the claimant in relation to the losses incurred and places them in the position they would have been in had the contract been performed. The losses suffered must be foreseeable and as a consequence of the breach of contract. It is important that these losses are not too remote.
2. Liquidated damages – Some contracts may include clauses which specify the exact sums to be recovered in the event of a breach of the contract. This is known as the liquidated damages clause. 
3. Restitutionary damages – these are damages which are aimed to strip from a wrongdoer gains made by committing a wrong or breaching a contract.
4. Declaratory relief – this is a binding judgement where a court defines the legal relationship between the parties and their rights. 
5. Specific performance – The court may exercise their discretion to order specific performance which essentially compels a party to perform its positive obligations under a contract where it considers damages would not be a sufficient remedy.

Just because a loss has occurred following a breach of contract, does not mean that those losses are recoverable. There are some factors that courts consider before deciding the quantum of loss that should be awarded. 

1. Mitigation – A court will consider whether a claimant has unreasonably failed to mitigate or acted to increase its loss. The rationale is that a claimant should not be able to recover sums which are attributable to their own unreasonable conduct.
2. Remoteness of damage – Even if losses are incurred by the defendant’s breach of contract, these will not be recoverable where they were not in the “contemplation of the parties as at the time of entering the contract”. In assessing what was in the contemplation of the parties at the time of entering the contract, the courts will “impute” knowledge of the ordinary course of things and actual knowledge of special circumstances communicated between the parties.

Our solicitors can assist you in claiming or defending a contractual dispute. We can assist with:

1. Reviewing and advising on the terms of the contract (or where there is no written contract), the evidence supporting any verbally agreed terms.
2. Partake in pre-action work to try and resolve the matter.
3. Represent you in a mediation or some other form of Alternative Dispute Resolution.
4. Represent you if the matter goes to court.
5. Assist you in strengthening your legal protection in a contract by suggesting amendments.