As a Florida business owner, you will most likely have contracts with various vendors, customers, real estate companies, service providers, human resources entities, and others. These documents are often essential for business operations. However, where there are binding agreements, there is also the possibility of a breach of contract claim. If another party has filed a breach claim against you, it’s important to know how to protect yourself and your business. I have been sued for breach of contract: What are my defenses?
Defending Yourself Against a Breach of Contract Claim
Each year, thousands of business owners find themselves in litigation over breach of contract issues. While some of these claims may have merit, others can be defeated with the proper defensive strategy.
To defend yourself successfully, you need to know how breach of contract law and claims work. Therefore, if you have been sued over a breach of contract, your first step should be to contact an experienced Florida business attorney.
Your Florida business attorney can help you evaluate the plaintiff’s breach of contract claim, evaluate the agreement and circumstances, and help you develop your defense. Your business lawyer can also explain how the following defenses may apply to your case:
Breach of Contract Defenses
Valid Contract
One defense to a breach of contract claim is that there was no valid contract. To be enforceable, a contract must have been formed as follows:
One defense to a breach of contract claim is that there was no valid contract. To be enforceable, a contract must have been formed as follows:
- Offer and Acceptance—one party must have made an offer that the other party accepted, and
- Consideration—meaning the parties exchanged something of value. In the business context, the value could be a promise to deliver something and pay upon that delivery. It may also be payment for goods or services.
Statute of Frauds
Some contracts must be in writing to be enforceable. For example, under Florida law, real estate sales, the promise to pay another’s debt, the sale of goods for over $500, leases for more than a year, and contracts that would take more than a year to complete all must be in writing. If your agreement was supposed to be in writing and is not, it will probably not be enforceable. In that instance, you may have a defense against a breach of contract claim.
Fraudulent and Unconscionable Contracts
Although an agreement may appear valid on its face, there may be a defense that it was fraudulently or unconscionably formed. Florida law provides that illegal contracts are unenforceable. In addition, agreements created by fraud, duress, or coercion are also invalid. For example, if evidence is presented that one party threatened the other into signing an agreement, the unwilling party would probably not be held to the agreement’s terms. Likewise, if someone without contracting capacity was tricked into signing a contract, that agreement would probably not be valid.
Mutual Mistakes
Mutual mistake occurs when the party who sued the other for breach of contract also violated the agreement. Under these circumstances, if you present the proper evidence of a mutual mistake, you may be able to invalidate the contract.
Statute of Limitations
As with most business-related laws, breach of contract disputes must be brought within the applicable statute of limitations. If the other party filed their claim against you outside of the applicable time period, you may be able to have their case dismissed.
No Loss or Damages
When there has been a breach of contract, it usually involves the claimant being harmed by the breach. However, a party may have a defense if they can show the contract terms were fulfilled, and the complaining party did not incur losses or damage as a result of the breach.
Impossibility
In some situations, a breach will occur because it is no longer possible for a party to fulfill its obligation. For example, suppose you contracted with another party to perform work on their property, and they sold the property before the work began. In that circumstance, you may have a valid defense that the contract could not be fulfilled under its terms.
If you have been sued for breach of contract, you should contact an experienced Florida business attorney as soon as possible to discuss your case. Your counsel can help you review your circumstances and identify potential defenses.
Contact an Experienced Florida Business Attorney
Attorney Richard Sierra at the Florida Small Business Center assists clients like you with commercial leasing, business, and litigation matters. As always, Our Goal Is to Help You Succeed™. For an appointment, you may call us at 1-866-842-5202 or use the contact form on our website. We represent clients throughout the State of Florida, including Coral Springs, Coconut Creek, Boca Raton, Delray Beach, Pompano Beach, Sunrise, Fort Lauderdale, Miami, West Palm Beach, Jupiter, Deerfield Beach, Stuart, Port St. Lucie, Orlando, Naples, Fort Myers, Sarasota, Tampa, and surrounding communities.