Texas' breach of contract laws offer a legal remedy in situations where one party fails or refuses to abide by the terms of their employment contract or other business contracts. It is important to note that a breach of contract case is a civil action in Texas. If the party can prove a breach of contract, they may be eligible to recover damages and other remedies.
Our Houston breach of contract attorneys explain what makes a contract legally binding in Texas, what to do if your contract is breached or broken, and your legal options for resolving the breach of contract, such as monetary payments or injunctions to stop certain actions.
How Do You Prove a Breach of Contract Claim in Texas?
In order to launch a successful lawsuit, the plaintiff claiming breach of contract has to prove all the following elements:
The existence of a valid contract. For a contract to be deemed valid, it must have an offer, acceptance of the offer and consideration.
The plaintiff adhered to the terms of the contract.
The defendant failed to fulfill the terms of the contract.
There is proof of damage to the plaintiff resulting from the breach.
For your case to win, it must be material. A material breach is where one party is deprived of the very benefits of which they signed the contract. The court will always look at different factors to find out if the breach occurred. To be on the safe side, you need a skilled breach of contract lawyer who knows Texas contract law to argue your case.
This is because the defendant might do everything possible to try and water down your case by poking holes in your evidence. On the other hand, the defendant might argue that indeed, there was no valid contract in the first place. With competent legal representation on your side, your attorney will be able to effectively argue your case while protecting your best interests.
What Is the Penalty for Breach a Contract in Texas?
Breaching a contract in Texas can have serious consequences. Texas law allows parties who prevail in breach of contract claims to be “made whole,” which usually means monetary payment known in the legal world as "damages." To calculate damages, you must first study the terms of the contract. Most business contracts have provisions indicating the consequences should one party breach the contract terms.
In cases where there are no written provisions, the court will consider the following monetary compensation or "damages":
Money that was lost as a result of a contract breach
Future profits lost as a result of the breach
Compensation to the plaintiff for time wasted
Any other damages in line with the contract terms
What If Money Damages Alone Can't Make Things Right?
If monetary damages will not be sufficient to make your business whole after a breached contract, you may be entitled to an what is known as an “equitable remedy.”
In Texas, there are four types of equitable breach of contract remedies available:
- Rescission voids the contract.
- Specific Performance orders the breaching party to perform its contractual obligations as closely as possible.
- Reformation is a court order to change the contract, usually to correct a mistake.
- Injunction orders the breaching party to do or stop doing a specific action. There are three types of injunctions in Texas.
Is There a Statute of Limitations for Breach of Contract Claims in Texas?
Yes, there is a statute of limitations for breach of contract claims in Texas. Chapter 16 of the Texas Civil Practice and Remedies Code categorically states that there is a four-year statute of limitations for all claims of breach of contract. Consequently, you must typically file a lawsuit within four years of the breach. Failure to do so means you will not be able to file such a case.
It is important to contact a lawyer with knowledge of breach of contract cases as soon as possible to determine if your case meets the time limit and initiate your lawsuit in an appropriate time.
What Makes a Contract Legally Binding in Texas?
For a legally binding contract, Texas law requires specific conditions. Under the state’s law, the following are requirements of a valid contract:
Acceptance in strict adherence to the terms of the offer;
A meeting of the minds, which is the subpart of offer and accepted elements, not independent elements;
Communication either in writing or verbally showing that each party has consented to the terms of the contract and;
Consideration (a benefit each party gets, or expects to get, by entering the contract); and
Execution and delivery of the contract with the intention that it will be a mutual and binding document for both parties.
These requirements apply to both written and verbal contracts and must be accounted for in order for the contract to be valid. Without these elements, a contract is invalid.
Speak to a Texas Breach of Contract Attorney Today
The first step towards protecting your best interests in your breach of contract case is by having the right legal team on your side. Hendershot Cowart P.C. has the skills and experience needed to effectively defend your rights. Our Houston business law attorneys are dedicated to providing our clients with strategic, creative, and aggressive advocacy. To do this, we tailor our services and strategies to each clients’ unique needs and goals.
Contact our Houston breach of contract lawyers today at (713) 909-7323 for assistance in your legal case.