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Minor v. material breach of contract

Corporations all over the world use contracts as the backbone of their everyday business functions, and Las Vegas companies are no exception. Cornell University’s Legal Information Institute explains that, when such companies become involved in a contract dispute, there are a variety of breach of contract remedies that may enter the equation, including monetary damages and specific performance requirements.

It is important to note that not all breaches are the same. The University of New Mexico’s Judicial Education Center explains that a breach of contract can be minor or material, and this distinction can determine what types of remedies may be available to the nonbreaching party. 

According to the JEC, a breach is considered minor if the nonbreaching party will still receive what it is owed via the contract. In other words, a minor breach does not substantially affect the contract’s overall fulfillment. In such situations, remedies for the breach may include damages, but the nonbreaching party will still be required to complete its contractual obligations.

A breach is deemed to be material, explains the JEC, if it results in a substantial deviation from what the nonbreaching party was supposed to receive under the contract. A purchase agreement for a case of coffee mugs, for example, would be materially breached if the delivery box contained nothing but dinner plates. In this type of situation, the nonbreaching party may be excused from its performance under the contract. The nonbreaching party may also be able to successfully argue for other breach of contract remedies.  

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