These days, even with rules governing contracts both written and verbal, some people may try to back out of a contract or fail to live up to their agreement. An Arizona breach of contract generally occurs when one party violates a provision of a contract. Let’s take a closer look at what a breach of contract actually is and what you can do if it occurs.
Disclaimer: Please note that this article is not intended to be legal advice. You should always talk to an attorney who is skilled at business and civil law about your unique situation.
What is a contract in Arizona?
Before discussing breaches of contract, it’s important to define what a contract is in Arizona. A contract is an agreement entered into between two parties under mutually agreeable conditions. A contract has to include these three parts.
Offer: An offer can be written or verbal, under Arizona law. This statement presents something for sale, barter, lease, trade, etc. This might be a quote from a plumber to fix your leaky pipes, an employment agreement, or it may be a written offer to buy a car.
Acceptance: Acceptance may be your signature, or it may be a verbal acceptance, as we’ll discuss shortly, or in some cases it could be performance of the act called for in the contract.
Consideration: Consideration is what will be exchanged, and is a critical part of any contract. This may be money, but it may also be time, in-kind donations, services, or anything else that will be part of the exchange.
Verbal vs. written contracts
Although Arizona law allows for verbal contracts in some cases, most contracts must be written to be considered valid. This is based on the Statute of Frauds. A.R.S. §44-101 outlines the types of contracts that must be in writing to be valid.
The most common of these include services that will not be rendered or completed within a year of the contract, goods that are for sale in excess of $500, co-signing a debt for someone else, contracts for the purchase of real property. Sale items that require a loan (e.g., houses and cars) are also covered under the Uniform Commercial Code (UCC).
Legal ability to enter into a contract
The other important element of a contract is a person’s legal ability to enter into a contract, either for themselves or on behalf of an organization. Arizona statute Title 44, sections 131-140, deals with a person’s legal ability to enter into a contract.
Those who may not be able to do so include minor children, those ruled to be mentally incapacitated, people who are under the influence of drugs or alcohol.
What is a breach of contract in Arizona?
For contracts made legally, the breach of contract definition covers all three parts of the contract: the offer, acceptance, and consideration.
Breach of contract in Arizona can occur in any of the following situations when one of the parties entering into the contract fails to fulfill their part of the contract or when one party prevents the other party from fulfilling the contract (for example, when services are not completed, or goods are not as they originally presented). A contract may be breached in whole or in part.
There are three types of breach of contract.
1. Material: Does not allow a party to fulfill their part of the contract
2. Partial: A contracting party is still able to fulfill part of the contract
3. Anticipatory: A party believes that the other party will not fulfill their part of the contract
What are breach of contract elements?
To prove a breach of contract, you must show four things:
1. First, the party claiming a breach must show the contract is valid. It must be entered into by someone legally allowed to do so and it must be in writing, if required.
2. Next, the party claiming a breach must show that they performed their part of the contract or intend to, or have attempted to, even in the face of resistance or difficulty from the defendant.
3. The party claiming breach must also prove that the other party did not adequately perform their part of the contract.
4. Finally, the party claiming breach must show that they suffered losses because of the breach of contract.
Without a clear showing of any one of these elements, a breach is difficult to establish.
What are Arizona’s statutes of limitations for contracts?
As with most things, claims for breach of contract must be brought within specified periods of time. The statutes of limitations vary depending on the type of contract.
As stated in Arizona statute A.R.S. §12-548, a contract for a debt cannot be prosecuted as a breach of contract after six years. For example, if someone fails to pay back a loan you made to them, and you do not file for breach of contract before six years pass, then you have no rights to collect that debt through civil court.
For the sale of goods, Arizona law states that you must take action within four years of the contract. If your contract is verbal for any kinds of goods or services, you have even less time to prosecute: just three years under A.R.S. §12-543. And, most employment breach of contract claims must be brought within one year.
To make it even more complicated, if the city, state, or federal government is a party, there may also be an applicable notice of claims period, which may be limited to only six months. The lesson here? Get it in writing, and watch the calendar if things are not going well. When in doubt, consult a qualified attorney.
Can I get damages for an Arizona breach of contract?
If you file an action for breach of contract within the periods above, there are various remedies available for recovery of proven losses. The most common type of remedy is simple payment of money. Damages can include loss of use or income related to the contract and recovery of attorneys’ fees. Is there is a claim for fraud related to the contract, there may also be punitive damages available.
Deciding what damages to ask for is complicated, but a good civil law attorney in Arizona can help. They’ll attempt to recover any losses you experienced due to the breach of contract. An attorney with dedicated experience in Arizona contract law can review your breach of contract case and advise you on your best options going forward.
If you are looking for an Arizona breach of contract lawyer, ARTEMiS Law Firm can help. We have experience in all areas of contract law, from litigating breach of contract cases to contract review, negotiation, and drafting. Get in touch today.Contact Us