Many contract breaches, disputes and business disagreements revolve around significant discrepancies where the terms of the contract were not followed. For instance, imagine you run a factory and have a deal with a parts supplier to deliver shipments on the first of every month. One month, they send you parts you never ordered and fail to fulfill your actual order.
This constitutes a major breach of contract that causes significant financial harm to your factory. Not only are you unable to continue operations—resulting in lost productivity—but you could also lose potential sales. For instance, your factory may already have contracts in place with sales outlets, which you cannot fulfill because you did not receive the correct parts and materials. This costs you immediately in lost sales and may cost even more, as it could harm your reputation and cause the sales outlets to cancel those deals.
What if the materials are just late?
Where things get a bit more complex is if the shipment is simply late. A missed deadline can constitute a breach of contract, but you may need to show that it caused financial harm.
For example, suppose the parts and materials were supposed to arrive in the evening to be ready for the morning shift. If the supplier missed that deadline but the truck arrived early the next morning and production proceeded as planned, the contract was technically breached—the shipment was late—but your business may not have suffered financial losses.
That said, as illustrated above, delays can have a significant impact on production and lead to financial repercussions. If you find yourself involved in a dispute over a contract breach, be sure to carefully evaluate all of your legal options.