Breach of Contract Lawyers in California: Protecting Your Business Interests

Essential Elements of a Valid Contract

The governing contract law defines the following essential elements of a contract and breach claim:

● Legal Capacity: Contract law defines lawful parties as being of legal age, of a sound mind, and not intoxicated by substance. Corporations and corporate entities that are bankrupt do not have the legal capacity to enter contracts. Legal capacity is required by law as it enables parties to understand their rights and obligations under the contract, including the duties, consequences, risks, and benefits.
● Offer and Acceptance: This means that one party explicitly makes an offer, and the other side accepts the offer, with both parties intending to be bound by the contract. In preparing and drafting a contract, legal professionals or lawyers that deal with contracts advise and initiate offer clauses, while the other party’s business contract attorneys assist in the acceptance of contract terms.
● Lawful Purpose: The purpose of the contract should be legal in order to be enforceable. Cases involving any illegal activity or irregularity are not considered binding. Agreeing to trade illicit drugs, for example, is not a valid contract and cannot be eligible for a breach of contract claim.
● Consideration: Entering into a contract requires both parties to provide something of value, like service, money, or goods. For business contracts, contract law firms define consideration interests that are mutually acceptable to both parties.
● Obligations and Promises: Obligations and promises are the foundation of a contract. Obligations may be absolute, conditional, or contingent. Let’s look at their fundamental distinctions:

• Absolute obligations are obligations that should be done without any deviation or condition.
• Conditional obligations are dependent on an uncertain event occurring in the future.
• Contingent obligations are obligations that are dependent on the outcome of an event that’s likely to happen in the future.

You can hire a breach of contract dispute lawyer to help you understand if your contract has validity based on the above factors—and to represent you through arbitration or litigation.

Common Types of Contracts in California

Business contract lawyers at the Colby Law Firm have extensive knowledge of types of contracts, enabling us to identify breaches—even the most sly and subtle ones.

Oral Contracts Vs. Written Contracts

Also called verbal contracts, these contracts are legally binding in California as long as they have the elements that constitute a valid contract. While oral contracts may be harder to prove than written ones, oral arguments and the credibility of testimonies can support their enforceability in California courts.

Verbal contracts have several advantages, including:

• They are more flexible and informal.
• They are easy to form.
• They are quick, making them perfect for urgent situations.
• They are more cost-effective as they require no formal documentation.

Written contracts are agreements made in written form, either electronically or via longhand. As such, they are easier to prove in courts because the parties have documented their terms and have expressly come to an agreement, as evidenced by their signature on the contract.

Written contracts also have the following advantages:

• They offer clarity and precision to any business deal.
• They are enforceable.
• They give you legal protection.
• They can be enforced under the Statute of Frauds.

Understanding the Statute of Frauds

The California Statute of Frauds is a legal doctrine codified in California Civil Code section 1624 that requires certain agreements to be in writing. These include:

• Contracts that take more than one year to complete
• Sales agreements or contracts for the sale of goods worth over $500
• Lender contracts
• Broker contracts
• Marriage-related contracts
• Debt repayment contracts
• Real estate contracts

To satisfy the Statute of Frauds, there must be a signed written contract that defines the contract’s subject matter, has sufficient information to indicate that a contract exists, and clearly states the terms of the contract. That said, some common exceptions do exist where oral contracts are also considered valid. These include:

Partial Performance: If one party has partially performed their obligations under the contract, it could be sufficient to remove the agreement from the Statute of Frauds.

Admission: If the party against whom enforcement is sought admits in court or in legal pleadings that a contract exists.

Promissory Estoppel: If one party reasonably relied on the verbal promise of the other party and suffered in the process, the court may consider it unjust not to enforce the contract.

Merchant Confirmation Rule: According to the Uniform Commercial Code (UCC), if merchants exchange a written confirmation of an agreement and no objections are raised within ten days, it counts as a valid contract, even if the original agreement was verbal.

These exceptions can vary by jurisdiction, so it’s important to consult local lawyers and understand any legal precedents that apply.

Implied Contracts and Their Enforcement

Implied contracts arise from verbal statements, some forms of documents, or actions that can show connections and indicate that an agreement has been made. Like oral contracts, implied contracts are quite challenging to prove in court, and enforceability will depend on the specific circumstances surrounding the contract as well as any supporting evidence available.

Seeking a professional breach of contract attorney who understands the nuances of contract law is crucial in such breach claims.

General Contractor Agreements

General contractor agreements are commonly practiced in the service sector, especially in construction and professional industries. They are crucial in laying down the terms and conditions of the working arrangement entered into by the contractor and the client.

They include details like a comprehensive description of the services to be rendered, terms and length of the service, payment details, and clauses detailing confidentiality, non-solicitation, and dispute resolution.

It is important to note that the enforceability of certain clauses in a general contractor agreement (such as non-solicitation) are dependant on the specific terms and context of the agreement, as well as any relevant legal precedents.

Severance Packages and Employment Contracts

Severance packages detail what the employee will be entitled to receive as compensation in the event they are laid off for any legal reason other than performance or wrongdoing. This establishes a sense of security and a gesture of goodwill on the part of the employer.

The specifics of a severance package can vary significantly from employer to employer and depend on the terms negotiated during the employment contract, company policies in place, and prevailing local laws.

Employees may request and negotiate a severance package during the course of their employment, or it may be included in an employment contract upon hiring.

Both agreements include compensation, financial benefits, outplacement services, insurance coverage, unused paid time off, and a termination clause. They both serve as legal protections for employees and compliance requirements for employers under California law.

How To Identify a Breach of Contract

There are various ways a breach of contract can happen. These include:

• Complete non-performance of obligations
• Partial performance
• Failure to meet the expected quality of performance
• Delayed performance
• Deliberate refusal to perform
• Deviation from the terms of the contract
• Any other non-compliance with the terms of the contract

A good breach of contract lawyer can help you detect any form of non-compliance and the legal remedies available to you.

What Do You Need When Proving a Breach of Contract?

Certain essential components are required to prove a breach of contract under California law. Having experienced breach of contract lawyers can help strengthen your case. These components include:

• Evidence and Documentation: Evidence and documentation provide the factual basis for the claim. The types of evidence that can be submitted in court include the contract itself, emails, letters, invoices, and other records of communications. Maintaining detailed records to establish a clear timeline and substantiate the claim is important.
• Witness Testimony: This involves gathering and corroborating statements from individuals who can provide firsthand accounts of relevant events and support the breach of contract claim. Witnesses can be employees, third parties involved in the contract, or experts in the field.
• Causes of Action: Causes of action are the acts or omissions by which one party to the contract violates another party’s rights. These are the legal grounds on which a breach of contract claim is based.
• Statute of Limitations: The statute of limitations sets the period within which claims can be filed. If a complainant fails to file a suit within the statute of limitations periods, the defendant could use that as a defense for breach of contract. The statute of limitations in California is within four years from when the agreement is broken for a written contract and within two years for a verbal contract.

A contract dispute lawyer can advise on any exception that may apply.

Defenses Against Breach of Contract Claims

If you find yourself facing a breach of contract claim, it is important to know the legal defenses available to you. In this section, we will cover common defenses, including mistakes, duress and undue influence, fraud and misrepresentation, the statute of limitations, and the right to counsel. Our contract attorney will help determine the most optimal defense you can have in court.

Common Defenses

We analyze your contract and the circumstances surrounding your failure to fulfill your part before determining the best defense for you.

Unilateral and Bilateral Mistakes

Non-fulfillment of contract obligations may be a result of unilateral or bilateral misunderstanding of what the obligations are. For example, one party fails to satisfy the expectations of the other party because they have a different understanding of what fixing a car means. One may think it’s simply getting the engine to work while the other party expects damaged parts to be replaced.

If the amount of payment is also not specified and one party pays the actual wage per hour while the other expects a full day’s wage, the mistake is bilateral. Both of these mistakes can be used as a defense, and attorneys can assist in challenging unilateral and bilateral mistakes in court.

Duress and Undue Influence

A party forced to enter a contract under duress or undue influence may use this as a defense to the breach of contract. Duress is when one party uses pressure or threats, while undue influence is when one party uses his position of power to sway the other party to agree to the contract. If proven, these can be used as a defense for not fulfilling a contract.

A knowledgeable and experienced breach of contract lawyer in California, such as those at the Colby Law Firm, can help you navigate this defense.

Fraud and Misrepresentation

If one party was tricked into agreeing to a contract through intentional deceit or false information, they may be excused from fulfilling their obligations.

For example, if someone was falsely promised a specific luxury car in exchange for creating software for another party’s business, the deception could be used as a defense for not completing the software.

To prove fraud, it must be shown that there was an intent to misrepresent the truth to induce the other party to sign the contract, along with evidence of the fraud.

Statute of Limitations

The defendant can use the statute of limitations as a defense for a breach of contract case dismissal. The statute of limitations in California is within four years from when the agreement is broken for a written contract and within two years for a verbal contract.

Right to Counsel

If a breach of contract claim is filed against you, you have the right to hire a contract attorney to investigate the matter and represent you at every stage of the legal process.

Litigation Process for Breach of Contract Cases

Both parties should be aware of the order of the process they will go through when a breach claim is filed—from initial consultation to post-trial motions and alternative dispute resolution.

Understanding the litigation process and the support you can get from legal attorneys at every stage is crucial for effectively navigating breach of contract disputes.

• Initial Consultation and Case Evaluation: This is when you approach a breach of contract lawyer and present your case for their legal assessment of its merits.
• Pre-Trial Procedures: This is the preparation stage before the trial begins and involves filing motions, pre-trial statements, setting schedules, and resolving preliminary issues.
• Discovery Process: The stage where the breach of contract attorney of each side seeks to know what the other party plans to say pertaining to the contract issues through requests for information and documents.
• Trial and Post-trial Motions: These motions occur in the court where both sides’ counsel present opening statements, present evidence, examine witnesses, and deliver compelling closing arguments.
• Mediation: This stage is where an offer for settlement is made by a neutral mediator to help both parties come to a consensus as an alternative dispute resolution method.
• Arbitration and Alternative Dispute Resolution: This process occurs outside of the court, where a neutral arbitrator provides advice to the parties to settle their disputes equitably and outside the court.