The 4 Elements Of A Successful Breach Of Contract Claim In Australia

Suppose you’re in a contract and one of the parties fails to comply with the contract terms, causing you loss or damages. What would be the next best step to take? As the affected party, you can file a breach of contract claim against the other party.

To get the best possible outcome for your claim, consult an expert contract lawyer to help you file. Additionally, you must prove the four elements of a breach of contract claim. These elements are the existence of a contract, proof of performance, failure of performance by the defendant, and damages you incurred due to the breach.

This article dives into each element to help you fully understand the four elements required to file a successful breach of contract claim in Australia.

1. Existence Of A Valid Contract Between The Parties

The first and arguably the most important element of a breach of contract claim is the existence of a valid contract. If there’s no contract (or invalid), the plaintiff (the affected party) lacks any basis to file a claim.

Therefore, you must prove that a contract existed between the parties before proving the other elements.

How Do I Prove That A Contract Exists?

For a contract to be deemed valid in Australia, all five elements of a contract must have occurred. The five elements are:

  • Offer: One party must present a clear offer to the other party(ies).
  • Acceptance: The party or parties must accept the offer for the contract to be valid.
  • Consideration: There’s an exchange of value between the involved parties.
  • Capacity: All parties must have the capacity to enter into a contract.
  • Legality: The parties mutually intend to make the contract legally binding and enforceable.

2. You Performed Your Part Of The Contract

After showing proof that there was a valid contract legally binding you and the other parties, you must prove that you fulfilled your obligations outlined in the contract. If you didn’t fulfil your obligations, you must provide a valid justification for your non-performance.

During the court proceedings, the defendant may use the “non-performance argument” against you. Engaging a litigation lawyer with a deep understanding of such cases is important to ensure you get your preferred outcome.

3. The Defendant Failed To Perform Their Contract Obligations

If an individual or party fails to perform and fulfil their contract obligations, that’s a breach of contract. Therefore, you can file a breach of contract claim against them to recover the losses or damages you incurred.

A breach of contract falls into two main categories: material and minor breach. A material breach occurs when the other party fails to fulfil their contract obligations, causing harm, loss, or damage.

On the other hand, a minor breach is when the defendant’s actions don’t lead to an actual breach of the contract. For example, when a supplier is late to deliver products but still performs their obligations, though late.

There are also cases of substantial performance where the other party’s performance falls short of what the contract requires, leading to substantial loss. Or, anticipatory breach when one party indicates (through actions or words) that it won’t perform/fulfil its contractual obligations.

4. You Suffered Damages Or Loss

Besides proving the above three elements, you must also show that you suffered loss, harm, or damage due to the defendant’s failure to perform. When seeking compensation, you must explain the nature and extent of the damages.

For example, if the defendant fails to repay you $2,000, you can seek compensation for the owed amount. However, if the funds were meant for a certain opportunity (and the defendant knew), you can seek compensation for the lost opportunity.

When showing proof of damage or loss, it’s important to work with an experienced commercial lawyer to prevent the defendant from disapproving your claims.

What Damages Or Remedies Are Available For Breach Of Contract Claims in Australia?

After proving the four elements of a successful breach of contract claim, the court can offer various remedies to the plaintiff. The court may order “specific performance,” meaning the defendant should fulfil certain contract terms.

In cases where the plaintiff suffered monetary damages, the court may order the defendant to compensate the other party. If the affected party didn’t incur actual losses but the breach affected them, the court may order the defendant to pay them nominal damages.

How To Deal With A Breach Of Contract Claim

Whether you’re a plaintiff seeking compensation for damages or a defendant protecting yourself from harsh consequences of breach of contract charges, Aditum Lawyers can represent you or your business. Expert legal advice is important when dealing with breach of contract claims to protect yourself and your business from loss.

Our qualified contract lawyers are experienced in helping businesses deal with breach of contract claims. Contact us via 1300 234 886 or book a free consultation to speak to one of our expert commercial lawyers.

Resources & Further Reading

  1. https://www.gotocourt.com.au/civil-law/contracts/
  2. https://www.investopedia.com/terms/b/breach-of-contract.asp
  3. https://www.forbes.com/advisor/legal/personal-injury/nominal-damages/

Disclaimer: The information provided in this article is for general informational purposes only and should not be construed as legal advice. Consult with a qualified commercial lawyer for personalised advice regarding your specific situation.