What is a breach of contract and how do I make a claim in the UK

A breach of contract occurs when one party to a legally binding agreement fails to perform their obligations under it, without lawful excuse. Breach of contract is one of the most common legal disputes in commercial life: affecting businesses of all sizes and individuals alike. This guide explains what constitutes a breach, what remedies are available, and how to pursue a claim.

What Makes a Contract Legally Binding?

For a contract to be legally binding and enforceable, it must have four essential elements: offer, acceptance, consideration (something of value exchanged by each party), and an intention to create legal relations. Contracts do not need to be in writing to be valid: verbal contracts are legally enforceable in English law: but written contracts are easier to prove and enforce.

What Counts as a Breach?

A breach of contract occurs when a party fails to perform one or more of their contractual obligations. Common examples include:

• A supplier who fails to deliver goods or delivers defective goods
• A contractor who performs work to a poor standard
• A client who refuses to pay for services rendered
• An employee or business partner who breaches a confidentiality clause
• A seller who pulls out of an agreed transaction

A breach can be actual (where the failure has already occurred) or anticipatory (where one party makes clear before the performance date that they will not be fulfilling their obligations).

What Remedies Are Available?

Damages

The most common remedy for breach of contract is an award of damages: a financial payment to put the innocent party in the position they would have been in had the contract been performed. Damages are calculated to compensate for actual loss, not to punish the breaching party.

Specific Performance

In some cases, particularly involving unique property or goods. The court can order specific performance, requiring the breaching party to actually perform their contractual obligations. This is most commonly seen in property transactions.

Injunction

Where a party is threatening to breach a contract or is in continuing breach, the court can grant an injunction to stop them.

Termination

Where the breach is sufficiently serious (a repudiatory breach), the innocent party can treat the contract as ended and sue for damages for the loss of the entire contract.

How Do I Make a Claim?

1. Pre-action correspondence: Before going to court, you should write to the other party setting out the breach and the loss you have suffered, and giving them an opportunity to respond. This is required under the Pre-Action Protocol for debt claims and is good practice for all commercial disputes.
2. Letter before action: If correspondence does not resolve the matter, send a formal letter before action giving the other party a final opportunity to settle before proceedings are issued.
3. Issue a claim: If no settlement is reached, you issue a claim at the appropriate court. Claims up to £10,000 go to the small claims track; claims between £10,000 and £25,000 to the fast track; larger claims to the multi-track, and the most complex commercial claims to the Business and Property Courts.
4. The claim proceeds: The defendant files a defence, there is an exchange of documents and witness statements, and the case proceeds to a trial if not settled along the way.

Do I Need Legal Help?

For claims above £10,000, legal advice and representation significantly improve the prospects of a successful outcome. A direct access barrister can advise you on the strength of your claim, draft the letter before action, and represent you in court proceedings: without the cost of a solicitor layer on top.

Summary

A breach of contract occurs when a party fails to perform their contractual obligations. The main remedy is damages, though specific performance and injunctions are available in appropriate cases. Before going to court, pre-action correspondence is required. Claims are issued in the court appropriate to the value and complexity of the dispute. Direct access to a barrister provides cost-effective specialist legal support for commercial disputes.

For advice on a contract dispute, contact our team today.