Not every agreement is legally binding

Breach of Contract in Canada

What is a Breach of Contract?

When a party to a contract violates the agreement by failing to adhere to the terms of the agreement, this is called a “breach.” A breach of contract can be grounds for a lawsuit, even if the contract or agreement was oral and not written.

Before commencing a lawsuit for breach of contract, the suing party should consider the following:

  1. Whether an enforceable contract exists;
  2. Whether a term of that contract was breached; and,
  3. Whether the suing party suffered actual damage or loss as a result of the breach.

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What Remedies are Available for Breach of Contract in Canada?

In Canada, the most common remedy for breach of contract is a monetary award also known as damages. Courts may also order an equitable remedy called specific performance, where the party in breach may be ordered to fulfill its contractual obligations. In some cases, a Court may order an Injunction against the breaching party, requiring them to abstain from a specific activity that may be causing ongoing harm to the other contracting party.

How Can a Lawyer Help?

Under the law, not every agreement is legally binding. Certain conditions must be met in order for a contract to be deemed “enforceable.” Furthermore, not all “breaches” are created equal. Serious breaches, known as “fundamental breaches” may have a different effect on what remedies are available to you than if the breach is more minor. Finally, proving actual damages flowing from a breach can be complicated, and often have to specifically quantified.

Therefore, it is a good idea to have a lawyer review the contract and provide advice on your legal options before proceeding with a civil claim for breach of contract.

Contact a Contract Lawyer Now