Contracts are the underpinning of the business world. If people don’t adhere to the responsibilities outlined in a contract, everything falls apart. However, every businessperson in New Hampshire knows of a situation where a contract went wrong. Anticipatory repudiation occurs when one party no longer intends to meet their contractual obligations. Understanding how to handle this situation is a must for any entrepreneur.
The basics of anticipatory repudiation
In anticipatory repudiation, the party that’s declining to fulfill the contract should let the other party know. Although all that’s absolutely necessary is a clear statement of this intent, it’s usually done in writing. Sometimes, however, the repudiating party doesn’t come clean. Instead, it becomes self-evident that they’re simply not holding up their end of the bargain.
In some cases, it’s very normal for anticipatory repudiation to happen. It’s reasonably common in real estate transactions, for example. Contract repudiation is also a huge issue in business law. Many companies have had to deal with this problem.
Anticipatory repudiation may occur when a supplier can no longer fulfill an order for a client. Sometimes, the client will pursue legal action in the hopes of receiving damages. In other cases, if they have a long-standing relationship with the repudiating party, they may decide not to. Sometimes, these disputes can be handled in good faith between the parties themselves.
What are your options when faced with anticipatory repudiation?
If you are the aggrieved party to a contract in which the other party is not meeting their obligations, it’s important to speak to an attorney. A good lawyer may be able to help you understand what the costs and benefits of pursuing litigation would be. In some circumstances, it’s advisable. In other cases, you may be advised to hold your fire.