breach of contract

A breach occurs when a party fails or refuses to perform his promise, performs it defectively, or disables himself from performing it. Breach may be actual (at or after the time for performance) or anticipatory (a clear refusal before performance is due).

The injured party may sue for damages for the loss that naturally arose in the usual course of things or that the parties knew, when they contracted, to be likely to result (s.73); remote and indirect losses are not recoverable. Where the contract names a sum payable on breach, the court awards reasonable compensation up to that sum (s.74). Other remedies include rescission, specific performance (now the general rule after the 2018 amendment) and injunction.

Example

When the builder failed to hand over the flat on the agreed date, it was a breach of contract, and the buyer claimed damages under s.73 for the extra rent he had to pay.

In Indian law

• Section 73, Indian Contract Act, 1872 (compensation for loss caused by breach)
• Section 74, Indian Contract Act, 1872 (compensation where penalty stipulated)
• Section 39, Indian Contract Act, 1872 (refusal to perform)

See also

anticipatory breach · damages · specific performance · remoteness of damage

Read more in the study notes

• Separation of powers and its bearing on administrative law (Administrative Law)
• Rule of law and droit administratif (Administrative Law)
• Delegated legislation: meaning, growth, merits and administrative directions (Administrative Law)
• Control of delegated legislation: parliamentary, procedural and judicial (Administrative Law)
• Judicial power of the administration: quasi-judicial functions and administrative adjudication (Administrative Law)
• Reasoned decisions, exceptions to natural justice, effect of breach and Article 136 (Administrative Law)