If you are in the business world, a common cause of action you may encounter is for breach of contract. A breach of contract occurs when one party fails to perform an agreed-upon duty as specified in the contract, whether it is verbal or written. Sometimes the question arises as to how long a party to a contract has to perform her obligation.
Completion of Performance and Breach of Contract
A short example helps illustrate how this issue might arise: A retailer enters into a contract with an interior designer on Oct. 1st in which the designer agrees to redesign and spruce up the store for the holiday season. The contract requires prepayment of $5,000 and another payment of $5,000 upon completion but does not specify when the work needs to be started or completed. In mid-November, the retailer becomes worried because the work has not started and the retailer wants to be ready for Thanksgiving weekend. Has the interior designer failed to perform in a timely way and breached the contract? Is the retailer entitled to cancel and get its money back?
Contracts should generally include an agreed time for performance. When they don’t, Colorado contract law provides the act shall be made within “a reasonable time,” to be measured and proven by the circumstances of the particular case. In the example, the interior designer pretty clearly would breach if he failed to complete the work before Thanksgiving. But has he breached by not starting or completing the work by Nov. 15? Was the designer still capable of completing the work before Thanksgiving weekend? Did the retailer pay a premium for expedited work? Was the retailer cooperative in making the premises available to the designer? Did the designer encounter unforeseen circumstances?
All of these facts and circumstances would be considered by a court in deciding whether the designer breached by failure to perform or whether the retailer breached by canceling. Disputes like this can be avoided by specifying important terms, like the time for performance, in the contract.
Determination of implied “reasonable” contractual terms can be difficult under the best of circumstances. Things can quickly get worse when a specific timeline or other term is expected – by either party – and not communicated at the outset. And there can be further complications and different considerations if the contract involves the sale of goods or is of a type that must be in writing or performed within a specified time under the law.
Are you considering a breach of contract suit? Or are you being sued for failure to pay or perform? Do not proceed any further before calling one of our Colorado commercial litigation lawyers at Burg Simpson. We can help you evaluate your case, negotiate the resolution of conflict before it goes to court, or litigate your case if that becomes necessary. Our attorneys have decades of commercial litigation experience who can help you today. Call Burg Simpson directly at 303-792-5595.