Remedies of Breach of Contract

In a broad sense, a breach is the failure to carry out an obligation imposed by a promise, agreement, or contract. According to the Oxford Dictionary, a "breach" is when someone disregards a legal obligation. Something in this context refers to a deviant act or inaction. Failure on the part of either party to carry out their responsibilities as stated in the contract constitutes a violation of that agreement.

What does Breach of Contract Mean?

According to the Indian Contract Act of 1872, which states that a breach of contract is a breach of the legally required duty, a contract is considered to be legally binding. If one of the parties breaches the contract in this way, the other party has the right to terminate it. A contract violation can be committed entirely or partially.

The Specific Relief Act was initially passed as the "Specific Relief Act, 1877," and on the advice of the 9th Law Commission Report, it was later changed to the "Specific Relief Act, 1963." Because the law of contracts is substantive, it cannot provide all possible relief and remedies. Keeping this in mind, the Specific Relief Act of 1963 (hereinafter referred to as "the Act"), based on the Principles of Equity, Justice, and Good Conscience, expands the scope of seeking relief under the Civil Courts and provides for a variety of reliefs and remedies when it comes to violation of a legal right, as the act does not provide any rights in itself but requires them to be pleaded in front of the court.

Remedies for Breach of Contract

When any of the parties missed out deliberately or because of negligence to perform his or her part and it causes substantial damage, harm, or injury to other party involved in the contract; in such a condition, the aggrieved party has the following remedies:

Monetary Damages

Monetary claim is most common remedy for breach of contract. The injured party may be entitled to monetary compensation to cover any losses or damages suffered as a result of the breach. Further, the term "damages" suggests financial restitution for the loss incurred by the party that was wronged. The party that has been harmed by a breach of contract may file a claim for breach of contract damages, including general or liquidated damages, nominal damages (in cases of no loss), compensatory, punitive, and particular damages.

Injunctions

An injunction is a court order that requires the party who breached the contract to either stop engaging in the conduct that constitutes the breach, or to take specific actions to remedy the breach. Besides, Joyce defines injunction as, it is an order remedial whose main goal is to prevent the informed party from committing or continuing to commit some wrongdoing, which means, an injunction is an order (of the court) that requires a party to a lawsuit to perform or refrain from performing an act or object.

A court may issue an injunction for or against a specific person, group of people, or whomever involved in the contract. In certain situations, the court might need to impose as much restraint as possible on the party threatening the breach. When he is unable to take advantage of other opportunities, it could put some pressure on his mind and sway him to carry out his contract's terms. Injunctions are a type of special relief that a court would provide where monetary compensation would be insufficient or completely ineffective. Likewise, it can be also named as “preventive relief,” as by issuing an injunction order, this is made possible.

Specific Performance

This is special remedy that requires the party who breached the contract to fulfill his or her obligations as outlined in the contract. This remedy is commonly used when monetary damages are not sufficient to compensate the injured party.

Restitution

Restitution is a specific remedy that made available relief to the aggrieved party. Under the restitution provision, the party who beached the contract requires to return any benefits received under the contract to the injured party. This remedy is often used in cases where the injured party has already performed their obligations under the contract.

Rescission

Rescission is the provision that terminates the contract and releases both parties from their obligations under the contract. This remedy is available or used specially when a contract has been induced by fraud, duress, or mistake.

Conclusion

Likewise, it is important to note that the available remedies for breach of contract vary depending on the jurisdiction and the specific circumstances and terms and conditions of each case. In some cases, only one remedy is feasible; whereas in some other situation, multiple remedies may be available for the same breach of contract.

FAQs

Q1. What is a "contract breach"?

Ans. When one of the parties fails or refuses to carry out his or her promises or obligations under the contract, the contract may be canceled or broken. Therefore, it can be claimed that an agreement may be dissolved if one or more parties fail to uphold a binding agreement by breaking their pledge.

Q2. What are the consequences of breaking a commitment?

Ans. A breach of contract occurs when one or more of the parties concerned violates a commitment or agreement. Therefore, a breach of contract occurs when one of the parties fails to uphold the provisions of the agreement or fulfill its obligations under the terms of the contracts.

Q3. What is breach and remedies in Indian Contract Act 1872?

Ans. Depending upon the facts and conditions of the case, the Indian Contract Act provides following remedies for breach of contract −

• Suit for Damages − The injured party may file a lawsuit to recover monetary damages for losses suffered as a result of the breach.

• Suit for Injunction − The injured party may file a law suit for injunction to prevent the breaching party from causing any further harm.

• Suit for Specific Performance − In cases where monetary damages are not sufficient, the aggrieved party may file a suit for specific performance, which requires the breaching party to fulfill his or her obligations specified in the contract.