Business Organization and Transactions FAQ

Top 10 Reasons to Avoid Breaching a Contract

Top 10 Reasons to Avoid Breaching a Contract

1. Your Business Reputation. You could damage your reputation in the business community.
   
   
2. Your Business Relationships. You could sever your business relationship with the other party.
   
   
3. Lawsuits. You could be sued.
   
   
4. Time Away from Your Business. If sued, you could be forced to spend valuable time away from your business in order to respond to discovery requests, attend depositions, and litigate the matter in court.
   
   
5. Legal Fees. You could incur significant legal fees.
   
   
6. Specific Performance. Depending on the nature of the contract, you could be ordered by the court to perform your obligations under the contract.
   
   
7. Contempt. If you do not obey the court's order, you could be held in contempt, fined, and/or imprisoned.
   
   
8. Compensatory and Consequential Damages. You could be forced to pay money damages to the non-breaching party, in an amount that puts that party in as good a position as it would have been in were it not for the breach.
   
   
9. Punitive Damages. You could be ordered to pay punitive damages, which are not limited by the amount of the other party's losses and can be very significant.
   
   
10. You Lose All the Way Around. You could end up spending much more time, money, and mental and physical energy resolving the breach than you would have spent performing your obligations under the contract.
    
    

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