Contractors provide crucial services to small business owners. They complete projects, provide supplies and materials and perform various tasks that keep a business running and profiting.
Unfortunately, not all contractors will be a walk in the park to work with. Some may leave a business owner scrambling with the possibility of a contract breach.
Evidence to have on hand
California Courts discuss the limits of a breach of contract claim. First, before even filing, a business owner should have the evidence needed to prove certain elements of the case. This includes:
- That a valid contract existed in the first place
- That the business owner performed their part of the contract
- That the other party did not
- The damages the business owner suffered because of this failure to fulfill the contract
If a business owner did not fulfill their end of the contract, some cases still exist in which they will hold the upper ground. For example, if a business owner did not fulfill their end because the other party notified them that they would breach the contract, it will typically not get held against the business owner.
Matters of note
Note that the part most people struggle with involves proving that the damages related to the contract itself, and the other party’s failure to uphold it.
Also important: remembering the statute of limitations. With an oral contract, a business owner has two years to act. With a written contract, they must act within four years. Generally speaking, the sooner a business owner acts after a breach or intended breach of contract, the better the outcome.