Sending a Notice of Breach
Has your business contract fallen through? It’s time to take a step toward a resolution and provide the other party with a notice of breach.
The notice, generally in the form of a letter, states why you believe a breach has occurred and lays out the actions that you wish to be taken. In some cases, specific actions and deadlines may be laid out. Other times, these notices can be more general and serve primarily as an invitation to discuss the issue in person.
When you are drafting your notice of breach, there are several key pieces of information that must be included. First and foremost, it is important to make the date clear. Making the date of the notice of the breach is important should the dispute end up in court. Second, it is important to describe the breach in detail. Common examples of breaches include instances where the other party failed to perform, the other party stated that it will not perform its obligations in the future, or the other party has made it impossible for your company to perform your own obligations as stated by the agreement.
Once you have stated the nature of the breach clearly, it is important to offer a way to fix this problem. When you offer a cure, it is important to lay out a deadline for the proposed actions to be met. Many contacts lay out a specific cure-period, often around 30 days. If no cure is possible, you may request a termination of the contract and compensation for the damage accumulated by the breach.
After you send your notice of breach, watch for the other party’s response. Sometimes, the other company will reply suggesting that there is no actual breach of contract. If this is the case, you should consult with your attorney before responding. Other times, the other party will invite you to discuss the matter in person.