Navigating the Breach of Contract Claim

On a Breach of Contract cause of action you have to show the following:

  1. That you had an agreement.
  2. That you performed that agreement
  3. That the defendant breached the agreement (usually by not paying the money due)
  4. And that you have been damaged as a result in the total sum as per the agreement

A valid agreement exists when:

  1. There is an offer which contains all of the material and specific terms
  2. That offer was accepted by the defendant and
  3. There is valid consideration for the agreement.

A Breach of Contract claim may fail if the all or some of the following material terms are not 100% agreed upon:

  1. Price
  2. Quantity
  3. The scope of services to be provided
  4. The term of the agreement

However, all hope isn’t lost if your Breach of Contract claim fails. You have at least two other options:

Unjust Enrichment Claim: This is an equitable claim. It says that even if there wasn’t a formal agreement (say because the price was not agreed to, or some other material term might have been missing that makes a Breach of Contract claim unsuccessful) you should still get paid for the reasonable value of your services because the defendant requested services from you, you relied upon that request, the defendant knew you were performing services and the defendant has retained the benefit of those services without paying you, and as such as been unjustly enriched at your expense. Unlike in a Breach of Contract claim, with Unjust Enrichment you have to show the reasonable value of the services performed. This means showing that your price and time spent were both reasonable under the circumstances. This can be demonstrated by most or all of the following:

      1. Your out of pocket expenses
      2. Time logs/sheets showing:
        1. the time spent,
        2. days worked,
        3. individuals who performed the work,
        4. the exact work/services those individuals performed
      3. that the time spent is reasonable for the task performed
      4. that your fee is reasonable or justified in your industry.

An Account Stated Claim: In NY, if you send someone invoices over a period of months, and they:

      1. Never contest the invoices, or
      2. Make partial payments on the invoices, or
      3. Accept those invoices in writing and make a promise to pay

then you have an account stated claim which means you are entitled to the sum as stated in those invoices.

Conclusion: The key to any successful claim for money owed on a breach of an agreement, is organization.  Making sure your claim is organized is critical. Having all the proper documentation including (1) signed contracts (2) invoices (3) written demands for payment (4) written admissions that money is owed or you will get paid (5) supportive email/written correspondence, and (6) any other information showing you properly performed the services agreed upon will help to ensure your success.

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