Key Takeaways

  • Affirmative defenses provide legally recognized reasons to avoid liability even if a breach occurred.
  • Defendants bear the burden of proving affirmative defenses.
  • These defenses may arise from contract formation issues (e.g., duress, mistake) or post-formation changes (e.g., impossibility, waiver).
  • Procedural defenses like the statute of limitations or laches can also bar claims.
  • Arguing in the alternative allows defendants to raise multiple, even conflicting, defenses early in litigation.

The factual background of a contract is important to asserting affirmative defenses for an alleged breach. The facts and events supporting an affirmative defense most likely occurred either during contract formation or the performance of the contract.

When a party files for breach of contract, they set forth both the factual and legal allegations supporting how they were wronged by the defendant(s).

To prove breach, a plaintiff must prove:

  1. Valid contract formation
  2. Performance or lack of duty to perform by one party
  3. The other party’s failure to perform; and
  4. Harm that resulted in quantifiable loss

The first defense that a defendant can assert is by simply contesting the facts. The burden of proving that a breach occurred is on the party who brought the suit.

A second defense that a defendant can attempt is arguing that even if there was a breach, that it was only minor, and not a material breach. If the breach is minor, it is insufficient to hold the defendant liable for damages.

However, in some situations, it is a better strategy for the defendant to admit that the breach occurred and assert defenses. There are a number of defenses available to argue that a contract should not be enforced:

  1. Lack of formation
  2. Lack of capacity
  3. Lack of consideration
  4. Lack of meeting of the minds
  5. Mistake
  6. Duress
  7. Undue influence
  8. Unconscionability
  9. Misrepresentation or fraud
  10. Impossibility or impracticability
  11. Illegal purpose
  12. Statute of frauds error
  13. Estoppel
  14. Laches
  15. No privity
  16. Waiver
  17. Absence of condition precedent
  18. Assumption of the risk
  19. Comparative or contributory negligence
  20. Release
  21. Statute of limitations

Affirmative Defenses

A defendant should raise as many legal defenses as possible. This includes more than simply denying legal wrongdoing. Respond with every plausible argument that would prevent damages from being paid to the party who sued. Most defenses to breach of contract are "affirmative defenses."

Affirmative defenses are reasons given by the defendant as to why a plaintiff in a case should not win, even if what the plaintiff says is true. To support an affirmative defense, you must assert facts or circumstances that render the breach claim moot. The party who raises an affirmative defense has the burden of proving it. Defendants should bring up affirmative defenses in the early stages lawsuit. You do not want to lose the ability to raise them later.

Arguing in the Alternative

Defendants may assert multiple affirmative defenses simultaneously, even if they seem contradictory. For instance, a party can argue that no contract existed, that they performed all required duties, and alternatively, that if they didn’t perform, it was due to the plaintiff’s own breach or misconduct. Courts allow this strategy because litigation often reveals facts that support one defense over another. This "catch-all" tactic can preserve options throughout the case.

Meeting of the Minds / Mistake

A contract requires a “meeting of the minds.” Both parties must know and understand all the essential terms of the contract to make it enforceable. If either or both parties made a mistake regarding a term or terms of the contract, the contract may be “rescinded,” meaning not enforceable.

There are two defenses regarding mistakes: mutual mistake and unilateral mistake.

A mutual mistake is when both parties are mistaken regarding the contract and there is generally an issue as to whether the parties actually reached a meeting of the minds.

A unilateral mistake may not be a basis for voiding a contract on its own. However, if the non-mistaken party caused the mistake, or knew the other party was making a mistake and didn’t help correct it, the court will probably not enforce the contract.

If the only mistake made is in writing down a term or terms, a court may allow the mistake to be corrected. This is called “reformation.”

Duress

Duress occurs when a party is forced to enter into a contract that he or she would not have otherwise entered into. Threats of injury, lawsuit, or other types of blackmail are examples of duress that may void a contract.

Unconscionable

If a party enters into an unfair contract because the terms are unfair to one party, a court will likely find it to be unenforceable. Agreement to unfair terms usually occurs when one party is a company and the other party is an individual. The company is likely in a stronger bargaining position.

The company will also know that the individual is unlikely to be able to protect his interests and a court will likely find the contract to be unconscionable and therefore invalid. Courts will evaluate whether or not the defendant had a meaningful choice in agreeing to the terms. If the terms are so blatantly unfavorable that it would create an undue hardship to enforce it, a court may not enforce it regardless of bargaining power.

Impossibility

Impossibility of performance is exactly what it sounds like. Something happens after contract formation that makes performance impossible or impracticable. This renders the contract unenforceable.

Estoppel and Waiver

Estoppel prevents a party from asserting a breach if their own prior actions or statements led the other party to reasonably rely on a different understanding. For example, if a business owner verbally extends a deadline and the contractor relies on it, the business owner may be estopped from claiming breach.

Waiver occurs when a party voluntarily relinquishes a known contractual right. This could be explicit (in writing or orally) or implied through conduct. If one party repeatedly accepts late payments without objection, they may have waived their right to enforce strict payment deadlines later.

Statute of Frauds

The Statute of Frauds requires certain contracts to be in writing to be enforceable, such as agreements involving real estate, those that cannot be performed within one year, or promises to pay another’s debt. If a plaintiff is trying to enforce a verbal contract that falls under the Statute of Frauds, the defendant can raise this as an affirmative defense to invalidate the claim.

Statute of Limitations and Laches

The statute of limitations sets a legal time limit for filing a breach of contract lawsuit. If a claim is filed after this deadline, it can be dismissed regardless of its merit. The length of time varies by state and type of contract (e.g., oral vs. written).

Laches is an equitable defense that applies when a plaintiff unreasonably delays enforcing their rights and that delay prejudices the defendant. Even if a claim is technically within the statute of limitations, a defendant may still argue that the delay makes enforcement unfair.

Unclean Hands

The doctrine of unclean hands bars a plaintiff from recovering damages if they themselves acted unethically or in bad faith regarding the contract. For example, if the plaintiff pressured the defendant into the agreement through deception or misconduct, the court may decline to enforce the contract terms against the defendant.

Frequently Asked Questions

  1. What are affirmative defenses to breach of contract?
    They are legal arguments a defendant uses to avoid liability even if the breach happened, such as duress, mistake, or statute of limitations.
  2. Can I raise multiple affirmative defenses in my case?
    Yes. Courts allow defendants to assert several alternative defenses, even if some contradict each other.
  3. What is the difference between estoppel and waiver?
    Estoppel blocks claims based on previous misleading conduct, while waiver involves the voluntary relinquishment of a known right.
  4. How does the statute of limitations affect my case?
    If the claim is filed after the legal deadline, the defendant can ask the court to dismiss the case entirely.
  5. What if both parties acted wrongly?
    The doctrine of unclean hands may prevent a plaintiff from recovering damages if they also acted in bad faith.

If you need help with contract affirmative defenses, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.