Overview

Breach of contract may give the non-breaching party a right to terminate a contract.

The non-breaching party may terminate a contract for breach if;

1. a provision of the contract permits discharge for breach in the circumstances (eg, it might provide that in the event of failure to supply goods on a specific date the other party may terminate the contract)

2. the other party repudiates the contract - that is, renounces their obligations under it (eg, they say that will not perform the contract)

3. there is a breach of an essential term of the contract (even if the consequences of the breach are minor) (see classification of terms); or

4. there is a sufficiently serious breach of an intermediate term (minor or technical breaches will generally not allow the non-breaching party to terminate) (see classification of terms)

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Last updated: 18 October 2019