As a professional, I am here to explain the difference between a breach of contract and frustration of contract. It is important to understand the distinction between these two terms, as they have different legal implications.
Breach of Contract
A breach of contract occurs when one party fails to fulfill their obligations laid out in the contract. It can happen in several ways, such as failing to deliver goods or services on time, not paying money owed, or not completing work to the agreed-upon standard. When a breach of contract occurs, the other party may seek damages to compensate for the loss they have suffered.
For example, if a company hires a contractor to build a new office space and the contractor fails to complete the work according to the agreed-upon timeline, the company can sue the contractor for breach of contract. The company may seek damages to cover the costs of any delays, lost income, or additional expenses that result from the breach of contract.
Frustration of Contract
Frustration of contract occurs when a situation arises that makes it impossible to fulfill the terms of the contract. This situation is beyond the control of either party and is not a result of a breach of contract. It is important to note that frustration of contract can only occur in limited circumstances, such as unforeseen events that make it impossible to complete the contract.
For example, if a company hires a contractor to build a new office space and a natural disaster destroys the building before the construction is complete, frustration of contract may occur. In this case, the company and the contractor may agree to terminate the contract without any further obligation to each other.
In conclusion, a breach of contract occurs when one party fails to fulfill their obligations under the contract, while frustration of contract occurs when unforeseen circumstances make it impossible to fulfill the contract. It is important for parties to understand the difference between these two concepts and seek legal advice when necessary to protect their interests.