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How soon should you take action in a breach of contract claim?

On Behalf of | Oct 6, 2021 | business litigation

Like most small business owners, you rely on contractors to provide supplies, complete projects or perform other tasks. While many contractors are responsible, others can leave you scrambling. If you have to take legal action for a breach of contract, you likely need to act promptly.

A contractual breach is simply a violation of some term of a binding agreement between two or more parties. As a small business owner, you may have to deal with an actual breach or an anticipated one.

Elements of a breach of contract claim

To succeed with a breach of contract claim, you must prove the following elements by a preponderance of the evidence:

  • The existence of a valid contract
  • Your performance of the contract
  • The other party’s breach of the contract
  • Your damages

If you have not completed your performance on the contract, you may be able to pursue a breach of contract claim by showing you have a legally valid reason for not doing so. For example, you may have chosen not to do your part because the other party notified you it intended to breach the contract.

California’s statute of limitations

In the Golden State, plaintiffs must file a breach of written contract claims within four years from the date of the breach. Alternatively, you can file your claim up to four years after you reasonably should have known about the breach of contract. If the contract was an oral one, however, you may only have two years to take legal action.

Ultimately, to boost your chances of prevailing with your breach of contract cause of action, you probably want to explore your legal options immediately after you learn of an actual or intended breach.