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When it isn’t breach of contract

| Jun 13, 2017 | Business Formation & Planning

Contracts are an essential element of running a New York business, so breach of contract litigation has the potential to be devastating to a company. According to Cornell University Law School’s Legal Information Institute, the person bringing the action has the burden of proof in a breach of contract claim, and must provide evidence of the following four things:

  •          The contract is legal
  •          The plaintiff’s contractual duties were fulfilled
  •          The defendant’s contractual duties were unfulfilled
  •          That failure caused the plaintiff an economic loss

However, as the New York City Bar explains, proving those four things may not be that simple, and in many cases, there may be a valid defense for failing to meet the terms of the contract.

The contract may not be legal after all if it is the type that must be written, but it is not, or if it includes a mistake. It must not have any unclear or vague terms, and if there is one, or if the facts within the terms are not true, then it may not be enforceable. Also, if the terms of the contract become impossible to fulfill, it may no longer be binding.

People cannot legally enter into a contract if they are unwilling. If one of the parties is pressured into signing or signs under duress, the contract may not be valid. A person must also be able to legally agree to the terms of the contract. A minor or a person who has a mental health issue who signs a contract may not be bound to fulfill it. Other factors may also nullify the contract, depending on the specifics of the case.

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