Navigating a breach of contract

What happens when one party to a contract violates the terms of the agreement? Partner and head of the firm’s Emerging Companies and Venture Capital group Konata Lake told Canadian Lawyer that the best move for those involved is to engage in a dialogue and resolve the issue among themselves.

“That's the most efficient way,” Konata says.

Konata told Canadian Lawyer that the aggrieved party should deliver informal, written notification to state their position and invite the counterpart to settle the issue. If that does not work, the party claiming a breach should hire a lawyer, who will deliver a formal correspondence, detailing the breach and calling on the other party to rectify it immediately. If the request is not satisfied, the lawyer will bring the claim to a court.

It's important to note that just because one side broke the contract, does not mean the other is necessarily released from their own contractual obligations, he said.

“It depends on the terms of the contract,” Konata said.

“This is why it's important to clearly set out in contract what are the consequences of a breach.”

Konata adds that unless the contract specifically said it would be terminated for a breach, it is unlikely a breach would render the agreement void.

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