Aggrieved Party Meaning: Everything You Need to Know
The aggrieved party refers to any party whose personal, property, or financial interests or rights are negatively impacted by another's action or by a statute.3 min read
2. Breach of Contract
3. Misrepresentation in Contract Law
The aggrieved party meaning refers to any party whose personal, property, or financial interests or rights are negatively impacted by another's action or by a statute, a judgment, or an order. The aggrieved party is entitled to challenge the decision or the action legally in court.
In bankruptcy cases, any party with a substantial interest in the case is considered an aggrieved party. However, only parties for whom the order adversely and directly affected them financially may appeal. This means that their:
- Rights are impaired
- Burdens are increased
- Property is diminished.
Breach of Contract
Breaking or failing to act upon a contract constitutes a breach. The aggrieved party has the right to take legal action against the party that breached the contract. Remedies the court can order may include:
- Rescission, in which the contract is canceled and the aggrieved party refuses former performance and is discharged from his or her obligation, along with receiving compensation for damages. The court can refuse rescission if:
- The plaintiff implied or stated a ratification of the contract.
- Circumstances make it impossible to restore the parties to their original positions.
- Rights are acquired in good faith by third parties.
- A part of the contract that cannot be separated from the rest of the contract is rescinded.
- The injured party can also sue for damages, including those that have occurred naturally from the breach (ordinary) and those that were likely to result based on the contract terms (special). Damages strive to return the aggrieved party to his or her original position. Exemplary damages, which strive to punish the other party for the breach, may also be awarded. If a loss is not suffered, the court may award nominal damages.
- A suit for a specific performance of the contract means the court requires the breaching party to complete the contract according to the original terms. This often occurs in cases involving real estate or those in which compensation for work completed is due, as well as when:
- No standard to determine damages exists.
- Financial compensation is not adequate relief.
- The item in question has sentimental value.
- Monetary compensation would be impossible to pay.
- Specific performance is not granted when:
- Monetary compensation or damages are deemed sufficient.
- The contract was for personal services.
- The contract is vague, revocable, personal, in breach of trust, or inequitable to the parties.
- The court is unable to supervise this remedy.
- A suit for injunction is when the court orders a person to stop doing something. This can be ordered if the contract is void or voidable.
- A suit for quantum merit is used when some work has been done but completion is impossible. The other party must provide compensation for goods or services rendered.
Misrepresentation in Contract Law
Fraud in the inducement and in the factum are the two types of misrepresentation that exist in contract law. The former is when the person understands a contract but consents based on fraud. The latter is a deception that obscures the terms of the agreement from the person signing. No mutual assent means no contract. The court typically treats these two types of fraud interchangeably.
For example, if one party tells another party that he or she is at risk of foreclosure if that party does not move forward with a real estate deal, and the seller decides to sign the contract based on this information, this constitutes fraud by inducement. To claim damages successfully, the plaintiff must prove a breach of duty, along with or separate from a breach of contract. Misrepresented facts are sufficient evidence to fulfill this requirement.
Fraud by factum would occur if a person agreed to sell another person 100 items and delivered only 50 items. In cases like these, the courts typically find that mutual assent did not exist. The agreement depends on the validity of certain facts, and if misrepresentation occurs, the agreement is void. If the court finds that a party did not read an agreement before signing, however, that does not constitute misrepresentation. He or she is thus bound by the terms except in the presence of a valid excuse, such as blindness or illiteracy.
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