Breach of Contract in Miami and Orlando

If a plaintiff successfully proves that the defendant breached a valid contract, there are several ways a court could remedy the breach, including:

• General or compensatory damages. General or compensatory damages are designed to put the non-breaching party in the same place it would have without the breach.  For example, a court may award reimbursement for goods or services to replace the goods and services that should have been provided under the contract.
• Special or consequential damages. Special or consequential damages are related to the breach of contract “without direct correlation.”  An example of consequential damages that a court may award is reimbursement for lost business.  To obtain these damages, the injured party must show it was damaged either as a direct result of the breach or that the damages were an indirect but foreseeable result of the breach such as lost profits.
• Nominal damages. Nominal damages are damages that are awarded when there was a breach of contract, but no real harm resulted from that breach.  These damage awards are very small, sometimes $1 or $10, and are granted to show that the non-breaching party was “in the right.”
• Liquidated damage awards.  A contract may provide for “liquidated damages.”  Liquidated damages are the amount the parties have agreed to pay in the event of breach.  Florida courts will only award liquidated damages if they are agreed to in the contract.  Liquidated damage provisions are often included in contracts where it would be difficult to quantify the amount of damages in the event of a breach.  Courts will enforce liquidated damage provisions when they are reasonably related to an anticipated loss caused by the breach of contract.
• Legal fees. In the United States, each party is expected to bear their own legal fees and costs for breach of contract cases.  However, some agreements provide that the prevailing party in a contract dispute is entitled to recover their legal costs and fees.

A party enforcing a contract cannot recover speculative damages; there must be a real present basis for the damages that the party seeks. In Florida, a non-breaching party must also minimize its losses.  That is, if the losses incurred by a non-breaching party could have reasonably been avoided, the court may not award damages for that loss. Moreover, courts applying Florida law generally will not award punitive damages for breach of contract.

A court order to fulfill and perform contractual obligations is called specific performance.  Specific performance is typically awarded when money cannot compensate the injured party and when the contractual obligation is unique and difficult to value.

To obtain specific performance in Florida, the non-breaching party must prove (1) there is a valid contract existing between the parties, (2) the non-breaching party is “ready, willing, and able” to perform the contract or already has, (3) the breaching party refused to perform their obligation under the contract, and (4) there is no other adequate remedy available.

Rescission occurs when a court undoes the contract and puts all the parties back where they were prior to executing the contract.  Courts typically only rescind a contract when the non-breaching party has no other adequate remedy, and the parties can go back to the position they previously occupied before entering into the contract.  A non-breaching party cannot both rescind the contract and obtain damages – it must choose one of these remedies.

Contract reformation is rarely granted.  A party seeking reformation must assert that its contract does not accurately reflect the actual agreement reached by the parties.  This remedy is permitted when the same contractual term was misunderstood by both parties or where one party is mistaken and the other commits fraud or engages in inequitable conduct.

A few potential defenses to a breach of contract lawsuit are:

• Impossibility. Impossibility may be asserted when the contract has become impossible to perform.  For example, if a band has a contract to perform at a concert hall and the concert hall burns down the day before the performance, it is impossible for the concert hall to host the scheduled concert.
• Lack of capacity. Capacity is the legal ability to enter into an agreement.  If one party lacked capacity when the contract was formed, the court will likely not uphold the agreement.  Examples of individuals who lack capacity are children and sometimes persons who were intoxicated when they entered into the agreement.
• Mistake. A contract may be invalid where both parties were mistaken as to important facts at the time of the agreement.  For example, if both parties mistake the authenticity of a work of art, the transaction may then be undone.  If only one party is mistaken, it cannot always be undone.
• Unconscionability. A contract will not be upheld if it is ruled to be unconscionable.  Unconscionable contracts are those that are both unfair in their terms and methods of negotiation, but this is a very high legal standard.
• Illegality. When the contractual obligation is illegal, i.e., if the act you are contracting for is an illegal act, then the agreement will not be upheld in court.