Breach of contract is a legal cause of action and a type of civil wrong, in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party's performance. Breach occurs when a party to a contract fails to fulfill its(s), whether partially or wholly, as described in the contract, or communicates an intent to fail the obligation or otherwise appears not to be able to perform its obligation under the contract. Where there is breach of contract, the resulting damages will have to be paid by the party breaching the contract to the aggrieved party.

If a contract is rescinded, parties are legally allowed to undo the work unless doing so would directly charge the other party at that exact time.

It is important to bear in mind that contract law is not the same from country to country. Each country has its own independent, free standing law of contract. Therefore, it makes sense to examine the laws of the country to which the contract is governed before deciding how the law of contract (of that country) applies to any particular contractual relationship.

What constitutes a breach of contract.

To determine whether or not a contract has been breached, a judge needs to examine the contract. To do so, they must examine: the existence of a contract, the requirements of the contract, and if any modifications were made to the contract. Only then can the judge make a ruling on the existence and classifications of a breach. Additionally, for the contract to be breached and the judge to deem it worthy of a breach, the plaintiff must prove that there was a breach in the first place and that the plaintiff held up its side of the contract by completing everything required. Additionally, the plaintiff must notify the defendant of the breach prior to filing the lawsuit.