Missouri companies enter into contracts when they purchase goods, order services or take out loans. Contracts are legal documents that state the rights and responsibilities of each party, and they sometimes include a liquidated damages clause that makes clear what remedies will be available to an injured parry if the terms of the agreement are breached. When courts are called upon to resolve breach of contract disputes, injured parties are usually compensated financially for their losses even if they would prefer a different kind of remedy.
Specific performance
Parties embroiled in contract disputes sometimes seek a specific performance order instead of monetary damages. Orders of specific performance compel breaching parties to honor the terms of the contracts they entered into, but judges rarely issue them. Injured parties may prefer the goods they ordered to be delivered or the services they requested to be performed, but judges will usually ask them to accept financial compensation instead. Specific performance is usually reserved for situations where unique items or skills are involved and no other remedies would be sufficient.
Monetary damages
In most breach of contract disputes, the injured party is awarded monetary damages to compensate them for their harm. If breaching the terms of a contract did not cause any losses, nominal damages may be awarded. If the breaching party acted egregiously, they may be ordered to pay punitive as well as compensatory damages. These damages punish rather than compensate, and they are awarded to deter others from engaging in the same type of behavior. Punitive damages could be awarded in a breach of contract case if the breaching party engaged in misrepresentation or fraud or intentionally sold substandard or dangerous goods.
Avoiding contract disputes
Contract disputes can be expensive to litigate, and they are often the result of incorrect assumptions or unrealistic expectations. When the parties entering into a contract understand their responsibilities and appreciate what will be required to meet them, bitter legal disputes may be avoided. This is why it is important to think carefully before entering into a legally binding agreement.