Key Takeaways:

  • An "AC breach of contract" in Missouri involves a failure to fulfill contractual obligations, potentially resulting in monetary damages or specific performance.
  • Missouri breach of contract claims are governed by common law, the Uniform Commercial Code (UCC), and state statutes.
  • Material breaches significantly impact the contract's value, while minor breaches involve less substantial failures.
  • Legal remedies include compensatory damages, liquidated damages, or specific performance, with attorney fees recoverable in some cases.
  • Alternative dispute resolution methods, like mediation and arbitration, can often resolve contract disputes outside court.
  • Statute of limitations for breach of contract in Missouri is generally 5 years for written contracts and 3 years for oral contracts.
  • Defenses to breach claims can include fraud, duress, misrepresentation, and the statute of limitations.
  • Anticipatory breach occurs when one party signals in advance they will not fulfill their contractual duties.
  • Mitigating damages is a responsibility of the non-breaching party.
  • Consulting a qualified attorney can ensure proper handling of breach of contract disputes.

What Is Involved in a Breach of Contract?

There are reasons why one party would not fulfill the terms of an agreed-upon contract. Unexpected situations are one example. These can include financial issues, delivery of goods, delays, refusal to complete the services or failure to pay the amount agreed upon in a timely manner.

Under contract law, a breach occurs when a party has the absolute responsibility to perform and the responsibility/duty is not completed in accordance with the terms of the contract. The non-breaching party must be able and willing to perform the terms of the contract.

Anticipatory Breach of Contract

An anticipatory breach occurs when one party communicates, either through words or actions, that they will not fulfill their contractual obligations in the future. This type of breach allows the non-breaching party to pursue legal remedies before the breach actually occurs. For instance, if a contractor informs a property owner that they will not complete a repair project on schedule, this can be deemed an anticipatory breach. Under Missouri contract law, the non-breaching party can immediately seek damages or specific performance without waiting for the actual breach to take place.

Essentials Necessary to File a Breach of Contract

To take action with a breach of contract, several essential elements are necessary. These are:

  • A contract and its terms are in existence.
  • The plaintiff performed or tendered performance pursuant to the contract.
  • There has been a breach of contract by the defendant.
  • The plaintiff has suffered damages.

When one party claims a breach of contract by another, a judge must answer the following questions:

  • Was a contract in existence?
  • What were the requirements of each party involved with the contract?
  • Had the contract been subjected to modifications at any point?
  • Did the claim that a breach of contract occurred take place?
  • If a breach of contract did occur, was the breach material to the contract?
  • Does the breaching party have a legal defense to the enforcement of the contract?
  • What were the damages caused by the breach?

In the event of a contract being breached, the non-breaching party may ask that the court award damages. This is usually in the form of monetary compensation.

Damages may include compensatory or liquidated. Compensatory damages provide a party with a monetary amount that will cover and replace what was lost due to the breach of contract by the other party. Liquidated damages are those that are specified in a contract in the event of a breach of contract.

In some situations, monetary damages are not appropriate. Instead, the non-breaching party may request that there be specific performance rendered. This means the non-breaching party is asking that the court order the breaching party to perform the duties agreed to in the contract.

Another thing to consider is if the contract stipulates or the state law will allow a party to recover any attorney fees if they win the breach of contract lawsuit.

Defenses to a Breach of Contract Claim

When facing a breach of contract claim in Missouri, the defendant may raise several legal defenses, including:

  • Fraud: The contract was formed based on fraudulent information.
  • Duress: One party was coerced into signing the contract under threat or undue pressure.
  • Mistake: A mutual misunderstanding regarding a fundamental contract term.
  • Misrepresentation: False statements led one party to enter the agreement.
  • Illegality: The contract involves unlawful activities.
  • Impossibility of Performance: Unexpected circumstances make fulfilling the contract objectively impossible.
  • Statute of Limitations: Missouri generally allows five years to file a breach of contract lawsuit for written contracts and three years for oral contracts. Exceeding this period can bar legal action.

Missouri Breach of Contract

In Missouri, claims made involving a breach of contract are governed by three things:

  • Missouri common law.
  • Missouri's Uniform Commercial Code (UCC) Article II.
  • Other Missouri statutes.

The common law is developed by opinions of the Missouri Supreme Court and the Missouri Court of Appeals. The UCC, which was created to establish uniformity in the laws governing interstate commercial transactions, was drafted by various national law organizations.

All states, with the exception of Louisiana, have adopted the UCC via statute. The goal of the UCC is to have the laws in each state in harmony with each other in practice, but in reality, UCC provisions vary from state to state as do the interpretations of the UCC by the courts in different states.

Statute of Limitations for Breach of Contract in Missouri

The statute of limitations imposes a deadline to file a breach of contract claim in Missouri:

  • Written Contracts: 5 years from the date of the breach.
  • Oral Contracts: 3 years from the date of the breach.
  • Contracts for the Sale of Goods (UCC): 4 years under Missouri’s UCC regulations, though this can be reduced to a minimum of 1 year if agreed upon in writing.
    It is critical to act promptly when an AC breach of contract occurs to avoid losing the right to pursue legal remedies.

Alternative Dispute Resolution for Contract Disputes

Litigation is not the only option for resolving breach of contract cases in Missouri. Alternative Dispute Resolution (ADR) methods such as mediation and arbitration often provide faster and more cost-effective solutions:

  • Mediation: A neutral mediator facilitates negotiations between the parties to reach a mutually acceptable agreement.
  • Arbitration: A neutral arbitrator hears both sides and issues a binding decision, resembling a less formal trial.
    ADR can preserve business relationships and reduce the expenses associated with lengthy court battles. Legal counsel can advise whether ADR is appropriate for your ac breach of contract dispute.

Missouri's Uniform Commercial Code

The UCC in Missouri applies to transactions in "goods" which is defined as anything other than money that is movable. Under the UCC in Missouri, a contract for the sale of goods amounting to $500 or more is not enforceable unless it is in written form and signed by the party that enforcement is sought against.

There are exceptions, such as the contract between merchants. For example, an oral contract for the sale of goods amounting to $500 or more is enforceable if one merchant sends written confirmation of the contract to the other merchant who does not send a letter objecting to the terms provided in the confirmation within 10 days from the time the confirmation is received.

Mitigating Damages in Breach of Contract Cases

Missouri law requires the non-breaching party to take reasonable steps to reduce or "mitigate" their damages after a breach. This means the injured party cannot passively allow their losses to escalate. For example, if a supplier fails to deliver goods, the buyer should attempt to source similar products from another vendor to minimize business disruption. Failure to mitigate damages may reduce the amount recoverable in a lawsuit.

Material Versus Minor Breach of Contract

A material breach occurs if one party's failure to complete their obligations results in the other party receiving something significantly different. Anything negligent, harmful, or willful to the other party is considered material. A minor breach occurs when one party receives what was agreed to in the contract but the breaching party fails to perform something specifically agreed to in the contract.

Frequently Asked Questions

1. What is considered an "ac breach of contract" in Missouri?

An AC breach of contract involves failing to fulfill an agreement's terms, such as non-payment, late delivery, or substandard performance.

2. How long do I have to file a breach of contract lawsuit in Missouri?

You generally have 5 years for written contracts, 3 years for oral contracts, and 4 years for contracts involving the sale of goods.

3. Can I recover attorney fees in a breach of contract case?

Attorney fees are recoverable only if specified in the contract or allowed under Missouri law.

4. What is an anticipatory breach of contract?

This occurs when a party indicates they will not meet their future obligations, allowing the other party to seek legal remedies immediately.

5. What alternatives exist to litigation in breach of contract cases?

Mediation and arbitration offer quicker, less costly ways to resolve disputes while preserving business relationships.

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