In general, a purchase agreement is a type of legal document that provides a written account of the terms of a sale and purchase transaction that occurs between two or more parties. Thus, a purchase agreement is essentially a legally binding contract that is enforceable by a court, so long as its terms are found to be fair and valid. A purchase agreement will become legally binding as soon as the interested parties agree to the terms and sign the document.
The terms of a purchase agreement may be breached when any of the parties to the contract fail to perform some legal obligation they had as specified under the contract. For example, a buyer may violate a purchase agreement when they refuse to pay for services or goods they received from a seller. Another example of a breach of a purchase agreement would be if a seller did not deliver the goods or services that a buyer had already paid for and purchased.
Some examples of situations in which parties may enter into a purchase agreement include:
- When a person is buying or selling a house or another kind of property;
- When an individual is purchasing a telecommunications package, such as for internet, TV services, or their cell phone plan;
- When a person is buying clothes from an online retailer; and/or
- When a manufacturer and distributor arrange to do business together and they need legal guidance for future business dealings.
If you need help drafting a purchase agreement, or alternatively, if you believe that the terms of a purchase agreement have been breached and have caused you to suffer damages, then you may want to consult with a local business law attorney as soon as possible. An attorney will be able to assist you in negotiating and drafting a purchase agreement. An attorney can also help you to recover damages by representing you in a lawsuit against a breaching party.
What Are Some Examples of Breach of Purchase Agreement?
As mentioned above, a purchase agreement can be breached by either a seller or a buyer. In some cases, both parties may even be held responsible for the breach of a purchase agreement. Some examples of ways that a party to a purchase agreement can breach its terms may include the following actions:
- By failing to deliver the purchased goods or services on time to the relevant party;
- By delivering the wrong type of purchased goods or services to the relevant party;
- By making a last minute sale of the goods or services and giving them to a party who is not involved in the purchase agreement;
- By refusing to pay the total amount of funds owed to a party for delivering the correct goods or services on time;
- By failing to pay in full or to pay in the amount of agreed upon installments as defined in the terms of the parties’ purchase agreement; and/or
- By using fraudulent or deceptive tactics to induce a sale or purchase of goods or services (e.g., committing mortgage fraud in connection with a real estate purchase agreement).
In addition, the non-breaching party will be able to employ a number of methods in order to prove that the terms of a purchase agreement have been violated. However, in most instances, the court hearing the case will primarily look to the original intentions of the contracting parties as well as will review the provisions incorporated in the initial purchase agreement to determine whether or not there was a breach.
A court may also analyze the actions of each individual party involved in the purchase agreement after a supposed violation has occurred. They may check to see if any of the facts surrounding the matter indicate that one or more of the interested parties intended to breach the terms of the purchase agreement.
It is important to note that if a court finds that a purchase agreement is invalid and therefore legally unenforceable, then no breach may have occurred since no contract is said to exist. In that case, the court may order the parties to amend or create a new purchase agreement that is legally valid and enforceable in court.
How Are Breaches of Purchase Agreements Remedied?
There are a number of remedies that may apply when a purchase agreement is breached. In many instances, a non-breaching party will be able to file a lawsuit against the breaching party in which they may be able to recover a monetary damages award.
Of course, a party will only recover a monetary damages award if their lawsuit is successful. The money from a monetary damages award can be used to reimburse a non-breaching party for any losses they suffered.
The manner in which a monetary damages award is typically calculated is by using the fair market value of the goods and/or services at the time they were sold. In some cases, a loss of business profits and various other factors may be included in the total amount of a monetary damages award as well. However, the non-breaching party will need to prove that their loss was directly caused by a breach of the purchase agreement in some way.
In addition, a violation of the terms of a purchase agreement may also be resolved by other legal remedies, such as by requesting that a court order the seller to deliver the service and/or goods or asking the court if the parties can amend the terms of the original purchase agreement. Whether a party can receive these other remedies will depend on the nature of the breach, the provisions of the purchase agreement, and general contract law principles.
On the other hand, if the non-breaching party is the seller of the goods and/or services, then they may be able to recover the price of the goods or services they provided and any additional financial losses (e.g., shipping fees) that their business incurred as a result of a buyer’s actions, such as if a buyer refuses to pay for the goods or services.
Lastly, if the seller is forced to sell their goods or services to a third party due to a buyer’s breach of their purchase agreement, then the buyer may be ordered to make up any differences in the price as well as could potentially have to pay the costs of the seller’s attorneys’ fees.
Do I Need a Lawyer for Help with a Breach of Purchase Agreement?
As previously discussed, purchase agreements are extremely important legal documents that record the sale and purchase of goods and/or services between parties in written form. However, the laws and procedural requirements that govern purchase agreements can often be difficult to interpret without the help of a legal professional.
Therefore, it may be in your best interest to consider hiring a contract lawyer in your area if you are having issues involving a purchase agreement. An experienced business lawyer will be able to perform legal research on your issue and can assist you in determining whether or not another party breached your purchase agreement.
Your lawyer will also be able to help you draft and file any necessary legal documents in court should you decide to take legal action against a party. In addition, your lawyer will be able to explain the relevant laws in your area and can discuss the types of legal remedies that you may be able to recover if your case is successful. Finally, if you need to appear in court, your lawyer will be able to accompany you and can provide legal representation as well.