When a person brings a claim against you, they should be able to show the basic elements of a breach of contract claim. Those elements are–a valid contract with the parties, a material breach of the contract, and damages. The claim will be invalid if they cannot show any of them. Before making any steps, speak to an attorney to learn about Clearwater Business Law and about breach of contract claims. However, you should not handle such cases alone and speak to your attorney first.
Defenses to a breach of contract claim
When you prepare to defend yourself, make sure you have a valid contract with the other party.
The other will prove if the contract was valid, so you need to understand what you are up to. The following are the elements of a valid contract:
- A party made an offer.
- Another party accepted.
- Both parties gave consideration.
- The contract terms were reasonably specific.
- Both parties maintained the capacity to enter into the contract, and
- A legal contract was formed
- Formation issues
The basics of the contract should be present to make it enforceable, so there should be:
- An offer by a party
- The other party accepted the offer.
- Consideration by both parties.
The concept of consideration is something of worth given by each party to ensure the other party’s performance. Consideration is typically money exchanged for goods or services. But, the value can also come from one party refraining from some action they are legally entitled to do.
- Parol evidence
Parol’s evidence involves conversations and discussions surrounding the negotiation of a documented agreement that was never made to the final contract. The penal evidence law prohibits this information from being presented in court as evidence of the agreement. The court will only go through the written contract as enclosing the full extent of the parties’ obligations and rights.
- Misconduct in the formation of a contract
Even if the required elements for creating an agreement are present, defenses should be based on the circumstances surrounding their formation. A contract will not be enforceable if the subject matter is illegal or grossly unfair as to be unconscionable. Other defenses in this category include duress, coercion, and fraud, such as when one party was induced into contracting via false statements.
- Statute of Frauds
Most of the contracts we use regularly are based on oral agreements, but they must be in writing to make them enforceable. It requires a signed document in the agreement that involves:
- $500 or more goods value;
- Promises to settle the debt of another party; and
- Contracts that cannot be made within one year.