The Benefits Of Breach Remedies In Construction Contracts

by gclatworthy on December 19, 2012

  • Sumo

[US Law and General] The economy is finally on the rebound, and this has allowed more people to undertake construction projects. Just because the market has been down for awhile, however, doesn’t mean the process of handling construction has changed any. It is still absolutely essential to draw up contracts with anyone involved in new construction, and it’s just as imperative to ensure that there are remedies for a breach of contract listed within this agreement. 

What is a Breach of Contract?

As any construction attorney will explain, a breach of contract is the easiest legal definition to understand when it comes to contracts, breaches and remedies. A breach occurs when one party of a contract either refuses or doesn’t complete their end of the written bargain. This can occur if a contractor decides that they don’t want to finish work on a roof due to complications or if a homeowner decides not to pay a contractor because they don’t like how far over budget they’ve gone.

There are several remedies that a party can seek when it comes to breach of contract. Waiting until an actual breach has occurred, however, can be time consuming and expensive. It is always beneficial to include remedies within the actual contract.

Avoiding Litigation due to Breach of Contract

Many people decide to have contracts that require some form of mediation as opposed to litigation when a breach of contract occurs. This can save on legal fees for both parties, and since either party may commit the breach, it is usually beneficial for all those involved. Alternative dispute resolutions, such as mediation, are often more beneficial when the aggrieved party secures a lawyer. Even though an attorney isn’t necessary for alternative dispute resolution procedures, they can be extremely helpful.

Remedies for Breach of Contract

Even if mediation isn’t specified within a contract, it is important for a person to properly inspect their contract before signing. There is a chance that they may be giving up their right to certain remedies. A contract that includes or excludes certain remedies, however, is not necessarily a negative thing. It is simply important to understand the remedies available to an individual.


Monetary damages are often sought by those who feel as if they’ve been aggrieved by a breach of contract. Compensatory and incidental damages are very likely to be awarded to a party who is harmed in some way by the breach of contract. These damages are actual costs that were incurred due to the breach. It’s important to remember, however, that if litigation occurs, the possibility of punitive (punishment) damages exists.

Performance of Contract

Another remedy to breach of contract is to just have the performance of the contract completed. This basically means that whatever is promised within the original contract is finished. This doesn’t occur frequently when a breach of contract ends up in front of a judge since courts rarely like to get involved with monitoring the performance of a construction job.

Rescission and Reformation

Rescission occurs when the parties involved in the contract agree to cancel the contract entirely. This removes all parties from further obligation. No further performance is required and any money that was advanced for the job is returned.

Reformation, on the other hand, allows the parties involved to change the contract to reflect its original intention. If a written contract doesn’t match up to what the parties agreed on, for instance, the parties may decide to rewrite the contract in order to achieve what they initially were going for. This is a great way of avoiding litigation, and it’s often a good idea to include it within every contract.

Breach of contract remedies are necessary to ensure that people are treated fairly in their dealings. These remedies can sometimes be provided without having to go through a litigation process, and this will usually save many headaches in the long run.

Author Georgina Clatworthy is a freelance legal writer and formerly editor for a respected law blog. Further to the points above, she also advises that when creating a contract, it is advisable for an individual or contractor to get help from a construction attorney firm, such as Canfield, Maddon and Ruggiero, LLP who are experienced in contractual law. This proactive measure usually ends up saving time and money in the long run.

Previous post:

Next post: