What Can I do if the other party breach our contract?

You have several options, depending on the situation:

• You can demand that the other contracting party perform the obligations. This is called “specific performance.” However, specific performance is only useful in certain cases, according to the type of obligation. For example, it would be very difficult to force an actor to act in a play if he doesn’t want to. However, a furniture company can be forced to make a bed or a table it promised to deliver.

• You can ask the other contracting party to compensate you for not carrying out the obligations in the contract. For example, you could have the work done at the other party’s expense. The legal term for this is “performance by equivalence.” This option is useful when the other contracting party refuses to carry out the work promised or does the work badly. You can use the compensation to have someone else do the work instead.

• You can ask the court for an injunction forcing the other party to respect the obligations in the contract. An injunction is used to forbid someone from doing something or force someone to do something. The court will order an injunction only if the potential damage to you is serious and irreversible. For example, an injunction can be used if a person does not respect a non-competition clause.

• You can ask to have the contract cancelled. In most cases, specific conditions must be met before it will be cancelled: a) The other contracting party did not have a good reason for breaking the contract. For example, it should not be due to your own fault or an event that is beyond the other party’s control (referred to as “force majeure”). In the case of force majeure, the person who did not carry out his or her obligations might be excused from performing them, and you can’t have the contract cancelled. b) The obligations that were not carried out must involve an important aspect of the contract. If they weren’t essential to the contract as a whole, the contract can’t be cancelled. However, your own obligations might be reduced (for example, paying a lower price).c) You carried out your own obligations under the contract.

• If you don’t want to cancel the contract, you can ask for a reduction of your obligations. This is allowed when one of the contracting parties does not perform his or her obligations. For example, you reserve a truck online for the weekend, but the vehicle turns out to be a car. Since you need a vehicle right away, you take the car, but you can ask for a decrease in price because you didn’t get the truck you were expecting.

• You can ask for financial compensation for the damage and inconvenience. This option can be used alone if you are not interested in performance by equivalence or in the cancellation of the contract. You can also ask for compensation together with one of the other options listed above.

hmehrez@mehrezlaw.com