What Happens If Someone Breaches a Contract in Alberta?

A contract creates legal obligations between the parties who agree to its terms. When one party does not do what the contract requires, the other party may have a breach of contract claim. A breach can involve a missed payment, unfinished work, failure to deliver goods or services, or another failure to follow an important contract term.

So, what happens if someone breaches a contract in Alberta? The answer depends on the wording of the agreement, the type of breach, the losses caused, and the legal remedies available in the circumstances.

A contract dispute does not always have to end in court. The parties may be able to resolve the issue through communication, negotiation, mediation, or another dispute-resolution process. In other cases, a civil claim may be necessary.

If you believe someone breaches a contract in Alberta, or another party says that you have breached an agreement, reviewing the contract and getting legal advice early can help you understand your position and available options.

What Is a Breach of Contract in Alberta?

A breach of contract generally occurs when a party fails to perform an obligation required by an enforceable agreement.

For example, a contract may require one party to complete construction work by a particular date and another party to make payment according to agreed terms. If one party fails to perform an obligation, the other party may have grounds for a contract dispute.

However, not every disagreement is automatically a breach of contract. The actual wording of the agreement matters.

When assessing a possible breach, it may be necessary to consider:

• What the contract requires each party to do.
• Whether the contract is legally enforceable.
• Whether the alleged obligation was actually breached.
• Whether the breach is significant.
• Whether the contract contains notice or termination requirements.
• Whether the breach caused financial loss.
• What remedies are available under the contract or law.

Millennium Law Chambers explains that contract disputes can involve missed payments, unfinished work, broken business agreements, delayed projects, and failures to provide promised services.

A contract can be written or, in some circumstances, oral. The ability to enforce an agreement depends on the facts, the terms agreed upon, and applicable legal principles.

What Happens When Someone Breaches a Contract?

When someone breaches a contract, the first step is usually to understand exactly what happened.

Do not immediately assume that filing a lawsuit is the only option. A practical approach may include the following steps:

Review the contract: Look at the obligations, deadlines, payment terms, termination provisions, notice requirements, and dispute-resolution clauses.

Identify the alleged breach: Determine exactly what the other party failed to do.

Collect evidence: Keep the contract, amendments, emails, text messages, invoices, receipts, payment records, photographs, and other relevant documents.

Communicate with the other party: Depending on the circumstances, you may be able to ask the other party to correct the problem or comply with the agreement.

Consider negotiation or mediation; Some contract disputes can be resolved without a court hearing.

Consider legal action if necessary: If the dispute cannot be resolved, a civil claim may be available.

The Alberta Court of Justice specifically provides a civil-claim process for a claim seeking damages caused when a contract has been broken.

The appropriate response depends on the contract and the facts. A party should also be careful before terminating an agreement, withholding payment, or taking another major step because doing so may create additional legal issues.

Common Examples of Breach of Contract

Contract disputes can occur between individuals, businesses, contractors, customers, suppliers, landlords, tenants, and other parties.

Common examples include:

Failure to make payment: A customer or business does not pay an amount required under an agreement.

Failure to complete work: A contractor accepts responsibility for work but does not complete the agreed services.

Failure to deliver goods: A supplier does not deliver products required under a supply agreement.

Defective or incomplete performance: A party performs the work but does not meet the contractual requirements.

Missed contractual deadlines: A party fails to meet an important deadline established by the agreement.

Failure to provide agreed services: A business or professional does not provide services required under the contract.

Business agreement disputes: Partners, shareholders, suppliers, or other businesses may disagree about contractual obligations.

The legal consequences can vary significantly. A missed deadline in one contract may have different consequences from a failure to perform a central obligation in another contract.

This is why the actual agreement should be reviewed before deciding what legal action is appropriate.

What Can You Do If Someone Breaches a Contract in Alberta?

If you believe another party has breached your contract, start by preserving your documents and understanding your contractual rights.

You may want to:

• Locate the original signed agreement.
• Gather any amendments or additional agreements.
• Review payment records.
• Save relevant emails and messages.
• Document what happened and when.
• Keep records of financial losses.
• Check whether the contract requires written notice.
• Check whether the contract contains a mediation or arbitration clause.
• Avoid deleting relevant communications.
• Obtain legal advice before taking significant action.

A written record can become particularly important if the dispute later proceeds to negotiation, mediation, or litigation.

It is also important to consider whether the other party has a possible explanation or defence. For example, the contract may have been changed, a deadline may have been extended, or one party’s conduct may affect the legal position of the parties.

A contract dispute lawyer in Calgary can review the agreement and help determine what issues should be addressed before a claim is started.

What Remedies Are Available for Breach of Contract?

The remedy available after a breach depends on the contract, the nature of the breach, and the circumstances.

Damages

Damages may be available to compensate a party for loss caused by a breach of contract.

For example, if a party fails to perform an obligation and this causes a financial loss, the affected party may seek compensation where the legal requirements are met.

The amount of damages is not automatically equal to whatever amount the claimant requests. Evidence of the loss and applicable legal principles matter.

Specific Performance

In some situations, a court may order a party to perform a contractual obligation rather than simply awarding money.

Specific performance is not automatically available for every breach. Whether it is appropriate depends on the circumstances and the nature of the obligation involved.

Termination

A serious breach may, in some circumstances, give a party grounds to terminate a contract. However, termination rights depend on the agreement and applicable law.

Ending a contract without a proper legal basis can create additional problems. Before treating a contract as terminated, it is important to understand the contractual termination provisions and the legal effect of the alleged breach.

Contractual Remedies

Some contracts contain specific provisions dealing with default, notice, late payments, liquidated damages, termination, dispute resolution, or other remedies.

These provisions should be reviewed carefully before deciding what to do.

Can You Sue Someone for Breach of Contract in Alberta?

A breach of contract can give rise to a civil claim when the legal requirements for a claim are met.

The Alberta Court of Justice identifies breach of contract as a type of civil claim where damages are sought because a contract was broken.

However, starting a lawsuit is not always the best first step.

Before bringing a claim, it can be useful to consider:

• The strength of the contract.
• The evidence supporting the alleged breach.
• The financial loss involved.
• Possible defences.
• Any notice requirements.
• Limitation periods.
• The cost and time involved in litigation.
• Whether negotiation or mediation may resolve the dispute.

Civil litigation may involve pleadings, document disclosure, examinations for discovery, settlement discussions, mediation, and potentially a trial, depending on the case.

Millennium Law Chambers states that its civil litigation practice includes breach of contract and debt recovery matters and that the firm represents clients in Calgary and across Alberta.

What Evidence Do You Need for a Contract Dispute?

Evidence can be very important in a contract dispute.

Depending on the case, useful evidence may include:

• The signed contract.
• Written amendments.
• Emails between the parties.
• Text messages.
• Invoices.
• Receipts.
• Bank or payment records.
• Delivery records.
• Project records.
• Photographs.
• Business records.
• Notices sent to the other party.
• Records showing financial losses.
• Witness information.

Keep the original versions of important documents whenever possible.

For example, if a contractor says that work was completed but the customer says it was not, photographs, invoices, emails, inspection records, payment records, and other project documents may help establish what happened.

Similarly, in a business contract dispute, emails and payment records may help show what the parties agreed to and whether the contractual obligations were performed.

Evidence should be considered together with the actual contract. A message between the parties does not necessarily change a written agreement, and the legal effect of communications can depend on the circumstances.

When Can a Contract Be Terminated After a Breach?

A breach does not automatically mean that the entire contract is cancelled.

Whether a party can terminate an agreement may depend on:

• The terms of the contract.
• The seriousness of the breach.
• Any termination clause.
• Notice requirements.
• Whether the breach can be corrected.
• The conduct of the parties.
• Applicable contract law.

Some agreements specifically explain what happens after a default. They may provide an opportunity to correct the problem before termination.

For example, a commercial contract may require one party to provide written notice and give the other party a specified period to fix a breach.

Because the consequences of wrongful termination can be serious, it is sensible to obtain legal advice before ending an important agreement based on an alleged breach.

What If the Other Party Says You Breached the Contract?

A contract dispute can involve claims and counterclaims.

If someone alleges that you breached a contract, do not ignore the allegation.

Start by reviewing:

• The contract.
• The specific obligation they say you breached.
• Relevant correspondence.
• Payment records.
• Notices.
• Deadlines.
• Documents showing your performance.

You may have a defence or explanation that is not obvious from the initial allegation.

For example, the other party may have agreed to a deadline extension, failed to perform their own obligations, or misunderstood a term in the agreement.

If you receive a formal demand letter, court document, or other legal notice, consider obtaining legal advice promptly so you understand the response required and any applicable deadlines.

How Long Do You Have to Start a Contract Claim in Alberta?

Limitation periods are important in Alberta contract disputes.

The Limitations Act contains rules governing when claims must be started, and the applicable period can depend on the type of claim and when the claimant knew, or ought to have known, certain facts.

For many civil claims, the basic limitation period is commonly described as two years from when the claimant knew, or ought to have known, that the injury or loss occurred and that it was attributable to the defendant’s conduct. However, limitation law contains important exceptions and additional rules, so the specific facts matter.

Millennium Law Chambers also advises that Alberta’s Limitations Act can impose deadlines on civil claims and that missing an applicable limitation period can affect the right to sue.

Do not wait until the limitation period is close to expiring before getting legal advice. A lawyer can review the facts and determine which limitation rules may apply.

How a Contract Lawyer Can Help

A contract lawyer in Calgary can help with both pursuing and defending contract disputes.

Depending on the circumstances, a lawyer may assist with:

• Reviewing the contract.
• Identifying contractual obligations.
• Assessing an alleged breach.
• Reviewing evidence.
• Explaining potential remedies.
• Preparing correspondence or a demand letter.
• Negotiating with the other party.
• Participating in mediation.
• Preparing a civil claim.
• Responding to a claim.
• Representing a client in litigation.

The goal is not always to take the dispute to trial. Negotiation or mediation may provide a way to resolve the disagreement without a full court proceeding.

Millennium Law Chambers describes its contract-dispute practice as assisting individuals and businesses with contract review, legal options, negotiation, mediation, and court representation.

About Millennium Law Chambers

Millennium Law Chambers is a Calgary-based full-service law firm serving clients in Calgary and across Alberta.

The firm handles civil litigation and contract disputes involving individuals and businesses. Its civil litigation practice includes breach of contract, commercial disputes, debt recovery, property disputes, shareholder and partnership disputes, and other civil matters.

The firm is led by PM Menon Parakkal, Founder & Senior Attorney, who has more than 30 years of legal experience across Canada and internationally. Millennium Law Chambers identifies his practice areas as including civil litigation, corporate and commercial law, real estate, personal injury, criminal defence, and other areas of law.

His professional background includes legal practice in India, Saudi Arabia, and Canada. This international and Canadian experience forms part of the firm’s broader approach to civil and commercial legal matters.

For a contract dispute, the firm’s role may include reviewing the agreement, assessing the legal position, discussing potential resolution options, negotiating where appropriate, and representing a client if litigation becomes necessary.

Frequently Asked Questions

Q1. What is considered a breach of contract in Alberta?

A breach of contract generally occurs when a party fails to perform an obligation required by an enforceable agreement. Examples can include failing to make a required payment, failing to complete agreed work, or failing to deliver goods or services. Whether a particular situation amounts to a breach depends on the contract wording and the circumstances.

Q2. What happens if someone breaches a contract in Alberta?

The consequences depend on the agreement and the nature of the breach. The affected party may be able to seek damages or another remedy. The parties may also negotiate, mediate, or pursue a civil claim. A breach does not automatically mean that the contract is cancelled.

Q3. Can I sue someone for breach of contract in Alberta?

A breach of contract can form the basis of a civil claim when the applicable legal requirements are met. Alberta’s Court of Justice provides a civil-claim process that includes claims for damages caused by a broken contract.

Q4. What can I claim for breach of contract?

Depending on the circumstances, a claimant may seek damages or another legal remedy. The amount and type of remedy depend on the contract, the breach, the losses involved, and applicable law. A claimant generally needs evidence supporting the loss being claimed.

Q5. Can a verbal contract be enforced in Alberta?

Some oral agreements can be legally enforceable, but the answer depends on the circumstances and the type of agreement. Proving the terms of an oral agreement can also be more difficult than proving terms contained in a signed written contract.

Q6. How do I prove a breach of contract?

Evidence may include the contract, amendments, emails, text messages, invoices, payment records, photographs, delivery records, and other documents showing what the parties agreed to and what happened afterward.

Q7. Can I terminate a contract after a breach?

Not necessarily. The right to terminate can depend on the contract terms, the seriousness of the breach, notice requirements, and applicable law. Wrongfully terminating a contract can create additional legal issues, so legal advice may be appropriate before termination.

Q8. How long do I have to sue for breach of contract in Alberta?

The applicable limitation period depends on the claim and circumstances. Alberta’s Limitations Act contains rules governing when claims must be brought, including rules based on when a claimant knew or ought to have known about the claim. Because exceptions can apply, obtain legal advice about the specific deadline for your situation.

Q9. Do I need a lawyer for a contract dispute?

Not every contract dispute requires a lawyer. However, legal advice can be useful when a significant amount of money is involved, the contract is complicated, the other party has a lawyer, a formal demand has been received, termination is being considered, or litigation may be necessary.

Q10. What does a contract lawyer do in a breach of contract case?

A contract lawyer can review the agreement, assess the alleged breach, examine evidence, explain potential remedies, negotiate with the other party, assist with mediation, and represent a client in civil litigation when appropriate.

Speak With Millennium Law Chambers

A contract dispute can affect your finances, business, property, or personal interests. Taking action without first understanding the contract and the applicable legal rules can create additional problems.

If you believe someone has breached a contract in Alberta, or another party has accused you of breaching an agreement, Millennium Law Chambers can review your situation and explain your legal options.

Call now: (403)668-4300
Email: [email protected]
Location: Unit 215-4850 Westwinds Dr NE Calgary, AB T3J 3Z5

Contract disputes depend on the wording of the agreement and the facts of each case. Getting legal advice early can help you understand your position, preserve important evidence, and consider whether negotiation, mediation, or litigation is appropriate.

Legal Disclaimer: This article provides general legal information only and is not legal advice. Contract disputes depend on the facts of each case, the wording of the agreement, and applicable Alberta law. Speak with a qualified lawyer about your specific situation.