Contracts aren’t just for big business deals. They’re everywhere in daily life — from gym memberships and cell phone plans to freelance work and rental agreements. So what happens when one side doesn’t hold up their end of the deal?
That’s called a breach of contract, and it can carry serious consequences — even in simple situations. In this guide, we’ll break down what counts as a breach, common examples you probably encounter more than you realize, and how it’s handled legally.
What Is a Breach of Contract?
A breach of contract happens when one party fails to do what they agreed to in a legally binding contract — either fully or partially — without a valid legal excuse.
To bring a valid claim, you generally need to prove:
- A valid contract existed
- You fulfilled your part (or had a valid reason not to)
- The other party failed to perform their obligation
- You suffered some harm or loss as a result
Contracts don’t always have to be written. Verbal agreements can also be legally binding — though harder to prove in court.
Everyday Examples of Breach of Contract
Let’s look at some common real-world situations:
1. Landlord-Tenant Agreements
If your landlord promises to make essential repairs but never does, or tries to evict you early without cause — they may be breaching the lease.
Likewise, if a tenant stops paying rent without notice or damages the property beyond normal wear and tear, that’s also a breach.
2. Freelance or Contractor Work
A designer who takes payment but never delivers the final product? That’s a clear breach. So is a client who refuses to pay after work is completed per the agreement.
These disputes often come down to unclear terms — always put your contracts in writing.
3. Subscription Services
Canceling a gym membership but still being charged monthly? If the provider ignores the terms of cancellation, that could qualify as a breach.
Similarly, streaming or phone service outages that violate guaranteed service levels may entitle you to compensation.
4. Purchase Agreements
Ordering a product that never arrives, or getting something very different than described, may be considered a breach under consumer protection laws or contract terms.
Types of Breach: Not All Are Equal
There are four major categories:
✅ Material Breach
A serious violation that defeats the purpose of the contract (e.g., a builder using unsafe materials instead of those specified in a home renovation contract).
✅ Minor Breach (Partial Breach)
Less serious, but still a failure (e.g., late delivery of a product that still works as expected).
✅ Anticipatory Breach
When one party announces or clearly shows they won’t fulfill the contract before the deadline.
✅ Actual Breach
The failure to perform on the due date — or doing something completely against the terms.
Each type affects what kind of legal remedy you can seek.
Legal Remedies for Breach
Depending on the situation, U.S. law allows for different types of resolutions:
- Compensatory damages – monetary reimbursement for actual losses
- Consequential damages – additional costs caused by the breach
- Specific performance – court orders the breaching party to do what was promised
- Cancellation – ending the contract and walking away
- Rescission – canceling the contract and returning parties to pre-contract positions
Most small contract issues (like unpaid invoices or landlord disputes) can be handled in small claims court, depending on the dollar amount involved.
How to Protect Yourself
- Put everything in writing – even informal deals
- Specify key terms – deadlines, payments, expectations
- Keep documentation – texts, emails, receipts, etc.
- Know your cancellation rights – especially with memberships or subscriptions
- Communicate clearly and early if problems arise
And if the issue escalates, consult an attorney — especially if money, property, or your credit is at risk.
Can a Breach Be Excused?
Not every failure to perform counts as a breach. A party may be excused if:
- Force majeure (unforeseen events like natural disasters or war)
- Impossibility of performance (e.g., a vendor dies, or a law makes the contract illegal)
- Mutual agreement to cancel or modify the contract
In those cases, courts may side with the breaching party — but proof is critical.
Breach of contract isn’t just something that happens in courtrooms — it’s a daily risk in personal, professional, and business relationships. The key is knowing your rights, documenting your agreements, and acting quickly when things go wrong.
Whether it’s a broken promise from your landlord or a ghosting freelance client, you don’t need to be a lawyer to protect yourself. Understanding how contracts work — and what to do when they don’t — can save you time, money, and frustration.