Question 2: How many types of breaches of contract are there? What are they?

For every type of breach

of contract, is the party that breached the contract automatically relieved of his/her duty from performing
the contract? 

What are the remedies for a breach of contract? What, if any, are the differences between each remedy?
Which remedy is most commonly awarded by courts? Alternatively, in what particular scenario would a
court award one remedy over the most common remedy available? 

Answer: Every contract imposes obligations on both the parties to it. When one of them fails or refuses
to perform the obligations imposed upon him by the contract, this is known as breach of contract. The
party causing breach of contract is called the ‘guilty party’ and the other party is called the ‘injured’ or
‘aggrieved party’. This breach confers upon the aggrieved party a right of action against the defaulter
party. In some cases breach also discharges the injured party from performing his obligations under the
contract.

• Breach can arise in two ways: (1) anticipatory breach and (2) actual breach

(1) Anticipatory breach: When before the contract becomes due for performance, one of
the parties to it shows his intention not to perform the contract, this is called anticipatory
breach of contract. It is an announcement by one of the contracting parties of his intention
not to fulfill the contract. It may take place by two ways:

 By express repudiation: Under this one party to the contract communicates to the other
party, before the performance is due, his intention not to perform it.
 By creating some impossibility: A promisor may, before the time of performance
arrives, by doing some act, make the performance of
his promise impossible.

Effect of an anticipatory breach: Anticipatory breach would give to the aggrieved party
either of the following two options:

 He can treat the contract as rescinded and can bring an action for damages for breach of
contract immediately without waiting till the due date for performance; or
 He may treat the contract operative till the date of performance arrives and to sue only
after that date for damages for breach.

The option to sue at once or wait for performance lies with the aggrieved party.
 (2) Actual breach:

An actual breach When at the time of performance of contract one of the parties to the contract
fails, neglects or refuses to perform or does not perform his obligations, such breach is said to be
actual breach of contract. Actual breach can be of the following types:

On the due date of performance: Actual breach occurs when at the time of performance of
contract, one party fails or refuses to perform his obligation. In such a case the other party is
discharged from his obligation and can hold the defaulter party liable for damages for breach.

During the performance of the contract: This occurs when during the performance of the
contract, one party refuses or fails to perform his obligations under the contract. This breach can
be by express words (or act) or implied. In such cases the other party is discharged from further
performance of the contract.

A breach of contract can happen in both a written and an oral contract. The parties involved in a
breach of contract may resolve the issue among themselves, or in a court of law. 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.

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. Every contract is
created by two parties. A breach of contract may take place when a party to the contract:

 fails to perform their obligations under the contract in whole or in part

 behaves in a manner which shows an intention not to perform their obligations under
contract in the future or
 the contract becomes impossible to perform as a result of the defaulting party's own act.

Any breach of contract – warranty, condition or innominate term – gives rise to a right in the
hands of the innocent party to recover their damage suffered which caused by the breach of
contract by the defaulting party.
The REMEDIES FOR BREACH OF CONTRACT are-

* RESCISSION

* DAMAGES

*SPECIFIC PERFORMANCE

* INJUNCTION:

The REMEDIES FOR BREACH OF CONTRACT are,

 RESCISSION: The aggrieved party is freed from all of his/her obligations under the
Contract. When there is some problem about mistake, fraud, undue influence or duress in
a breach of contract the both parties in this contract may be terminated by the court.
When this happens, the name of the remedies is rescission.

 DAMAGES: The aggrieved party is entitled to receive compensation for any loss, or
damage, caused to him by the breach of contract and can file a suit for getting an order
for damages (money). When a contract is breached, the injured party can claim damages
from the other party. The breaching party fulfil the loss of the other party by giving
damages. The damages are mainly giving money to other parties. These kind of damages
are 2 kinds of. Such as,

1. COMPENSATORY DAMAGES - This compensates the aggrieved party for the

loss the aggrieved party has suffered. The breaching party cover the loss by giving
something that can recover the loss of the other party.
2. PUNITIVE DAMAGES -The court may order damages exceeding the actual loss
suffered by way of punishment.

 SPECIFIC PERFORMANCE: In certain special cases, the court can direct a party to
perform the contract according to the agreed term. It uses when money damages are not
acceptable. The court forces the breaching party to go towards the contract and do the
job accordingly to the contract. Specific performance is an optional remedy, which is
allowed ONLY in a limited. Usually, specific performance is concentrating ONLY in
cases where monetary compensation is not an adequate remedy.

 INJUNCTION: In certain circumstances the court can issue an order upon a party
whereby he/she is prohibited from doing something. In this case court order from doing a
certain thing that is not good for others.
 It is an order of the court. In cases of breach of contract, the injured party can do it. In
certain circumstances, get a negative injunction — an order prohibiting a party from
doing something. It is usually granted to apply negative terms in cases where damages
are not an adequate relief. It is particularly appropriate in cases of anticipatory breach of
contract
.

There are many difference between each remedies. There are four kinds of remedies which are
rescission, giving damages, specific performance and injunction. In rescission the aggrieved
party is freed from all of their obligations under the Contract. Where there is mistake, fraud,
undue influence or duress in a breach of contract the both parties in this contract may be
terminated by the court. When this happens, the name of the remedies is rescission. There is no
other option like giving damages or injunction. Giving damages are totally different from other
remedies. Here the aggrieved party is entitled to receive compensation for any loss, or damage,
caused to him by the breach of contract and can file a suit for getting an order for damages.
When a contract is breached, the injured party can claim damages from the other party.
Breaching party fulfil the loss of the other party by giving damages. In specific performance the
case will go to court and the court forces the breaching party to go towards the contract and do
the job accordingly to the contract. It uses where damages are not an adequate remedy. Here the
court forces the breaching party to go towards the contract and do the job accordingly to the
contract. It is an optional remedy, which is allowed ONLY in a limited. Usually, specific
performance is concentrating ONLY in cases where monetary compensation is not an adequate
remedy.

In injunction both parties have to attend on the court and no fiving damages or finish the
contract, here the court can issue an order upon a party whereby he/she is prohibited from doing
something. In this case court order from doing a certain thing that is not good for others. Here
party cannot do such thing that court order for not to do. In certain circumstances, get a negative
injunction — an order prohibiting a party from doing something. It is usually granted to apply
negative terms in cases where damages are not an adequate relief

We can see that different remedies have different system to take action against any kind of
breach of contract.

Compensatory damages are the most commonly awarded by courts. Among the four kinds of
remedies, given damages are used by court commonly and in damages between compensatory
and punitive damages, compensatory damages are commonly used by court. When this damages
are awarded, the court orders the person to pay money and fulfil the damages of the other party.
It is the most common remedy of breach of contract. In many country, in such kind of cases of
breach, many court awarded compensatory damages.