Remedies for Breach of Contract in New York State

For businesses and individuals alike, facing a breach of contract issue can be overwhelming. However, understanding the remedies for broken contracts can help you regain control and protect your interests.

If you are dealing with a contract dispute, we are here to help. Let’s look at remedies for breach of contract in New York State and how our breach of contract legal team at Woods Lonergan PLLC can assist you.

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Types of Breach of Contract

Understanding the different types of breaches is important for identifying the appropriate remedies for breach of contract:

Material Breach. This type of breach occurs when one party fails to perform a fundamental part of the contract, depriving the other party of the agreement’s benefits.
Minor Breach. Also known as a partial breach, this occurs when a party fails to perform a minor part of the contract. The non-breaching party can still sue for damages but must continue to fulfill their part of the contract.
Anticipatory Breach. This type of breach occurs when one party indicates they will not fulfill their contractual obligations before the performance is due. The non-breaching party can treat the contract as breached and seek remedies immediately.

Recognizing these types helps in determining the appropriate damages for a breach of contract claim.

Monetary Damages for Breach of Contract in New York State

The most common types of contract damages usually involve awarding monetary damages to the harmed party.

Compensatory Damages

Compensatory damages are designed to compensate the non-breaching party for the loss incurred due to the breach. These damages are calculated based on the difference between the value of the promised performance and the actual performance.

Consequential Damages

Consequential damages cover indirect losses resulting from the breach and were foreseeable when the contract was made. These damages are applicable when the breach causes additional harm beyond the immediate scope of the contract. For instance, if a supplier fails to deliver materials on time, causing the buyer to lose business, the buyer may claim consequential damages for lost profits.

Liquidated Damages

Liquidated damages are predetermined amounts specified in the contract to be paid in case of a breach. Courts enforce these damages if they are a reasonable estimate of the actual damages and not a penalty.

Nominal Damages

Nominal damages are small sums awarded when a breach has occurred, but no substantial loss can be proven. These damages acknowledge that a breach occurred, even if it did not result in significant financial harm. While nominal damages might seem minor, they uphold the principle that contracts must be honored.

Punitive Damages

Punitive damages are awarded to punish the breaching party for particularly egregious conduct, such as fraud or malice, rather than to compensate the non-breaching party. These damages are rare in breach of contract cases and are typically awarded only when the breaching party’s actions were especially harmful or deceitful.

Equitable Remedies for Breach of Contract

In addition to legal remedies, equitable remedies offer alternative solutions for breach of contract issues.

These remedies focus on fairness and may involve specific actions rather than monetary compensation:

Specific Performance. Specific performance requires the breaching party to fulfill their contractual obligations. This remedy is ordered when monetary damages are inadequate, typically in cases involving unique goods or real estate. For example, a court may order the seller of a rare painting to complete the sale as agreed.
Injunctions. These are court orders preventing a party from doing something (preliminary or permanent) or requiring them to take specific action. They are appropriate when there is a need to prevent irreparable harm that damages cannot remedy.
Rescission. Rescission allows the contract to be canceled, restoring the parties to their pre-contract positions. This remedy is used when there has been a fundamental breach or misrepresentation and provides a fresh start for both parties.
Reformation. This remedy involves modifying the contract to reflect the true intent of the parties. It is applicable when there has been a mutual mistake or fraud in the contract’s terms.

These equitable remedies offer additional options for those seeking breach of contract remedies, ensuring fair and just outcomes are available beyond monetary compensation. Understanding these remedies can help you find the most appropriate solution for your situation.

Contact Woods Lonergan PLLC Today

If you or your business is dealing with a breach of contract dispute, having skilled legal counsel to safeguard your rights and interests can make all the difference. At Woods Lonergan PLLC, we have decades of combined experience and are ready to help.

About the Author

Annie E. Causey, a Partner at Woods Lonergan PLLC, specializes in high-stakes complex civil litigation across various business industries and sectors. With extensive courtroom experience in New York state and federal courts, she represents clients in cases involving breach of contract, fiduciary duty, fraud, and business torts. Annie also provides general counsel to businesses and individuals, advising on the formation, negotiation, and protection of commercial interests in joint ventures, LLCs, partnerships, and closely held corporations. She has deep expertise across various industries, including retail, real estate, technology, and finance, and excels in handling board governance and complex litigation scenarios involving domestic and international businesses, ranging from small businesses to mid-size companies and publicly held corporations. Recognized by Super Lawyers from 2016 to 2024, Annie holds a J.D. from New York Law School and a B.A., magna cum laude, from the University of North Carolina at Charlotte. She is admitted to practice in New York and various federal courts, including the U.S. District Courts for the Southern and Eastern Districts of New York and the U.S. Court of Appeals for the Second Circuit.