Breach of contract

Breach of contract. A contract contains obligations of each of the parties to the agreement. If these obligations are not carried out or not performed or, if performed badly, a breach of contract occurs.

The result of the breach depends on how important the obligation is to the purpose of the contract. If the breach is very serious, (originally called a “breach of condition”) the innocent party may be able to repudiate or cancel the contract and possibly also claim for money compensation, called “damages”. If the parry committing the breach is in the process of performing the contract, he may be reduced to the status of a common carrier and lose any protection he may have enjoyed under the contract, e.g., the right to limit his liability for loss or damage to the cargo. If the breach is not so serious and can be cured by money compensation alone, the breach may be called a “breach of warranty” and the remedy would be damages. After 1980, it is unhelpful to refer to a rigid distinction between “conditions” and “warranty and the phrase “in-nominate clause” can be used to describe the obligation in a contract which can be breached.


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Written by Ship Inspection

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Brackish water arrival draught (BWAD)

Breach of contract and bills of lading