Results-Focused Legal Advocacy For Clients Throughout Greater Seattle

How your business can deal with anticipatory breaches

On Behalf of | Oct 21, 2022 | BUSINESS & COMMERCIAL LAW - Business Litigation |

Most companies in Washington carry out their important business matters through contracts. When everything goes well, all parties involved in a contract fulfill their respective sides of an agreement. Unfortunately, that doesn’t always happen. If you’re dealing with an anticipatory breach of contract, there are ways to resolve this situation.

Ignore the breach

If you expect that an anticipatory breach of contract won’t cause major problems, you can choose to not react to this situation. Typically, this arrangement is only possible when the parties involved in a contract have a good working relationship.

Cancel a contract

Another option to resolve a breach is to cancel a contract altogether. Choosing this option doesn’t penalize any party. For example, imagine that you run an electronics company. Your business creates and signs a contract with a computer supplier for 200 new computing devices. You could cancel this contract if the company can’t manufacture 200 computers.

Pursue legal action

Sometimes, it’s not possible to resolve a contract breach peacefully. With that in mind, you have the option to file a civil lawsuit. If another person or business breaches a valuable contract, you potentially have the right to seek damages. This option often takes more time than canceling a contract or letting a breach go. However, this option is also one that allows you to potentially claim damages over lost revenue.

For a contract breach to qualify as anticipatory, the party breaking this contract must do so in an absolute manner. An anticipatory breach is not you making assumptions that another party will not follow through. You can also choose to give another party breaching a contract a specified amount of time to resolve what’s causing this breach.