In previous articles, I have discussed the importance of operating your business with a valid contract, the essential elements every Florida contract must have to be valid, and what happens when a breach of contract occurs. Lets review six common defenses that are often used to defend breach of contract claims. If you’ve been accused of breaching a contract, you’ll want to continue reading this article.
1. Statute of Limitations
In Florida, a breach of contract claim must be brought forward within five years. If not, the claim is permanently barred and will prevent the injured party from recovering damages for their loss.
When one or more parties are pressured, forced or coerced into a contract, this takes away the party’s free will and constitutes duress. According to the Florida court in Franklin v. Wallace, the person accused of breaching the contract can use “duress” as a defense to the alleged breach.
3. Implied Covenant of Good Faith and Fair Dealing
The implied covenant of good faith and fair dealing, which requires every party of a contract to act in accordance with the contract’s purpose, is commonly used as a defense to breach of contract claims. However, in Florida this defense will not negate the express terms of a valid contract.
4. Impossibility of Performance
When a party of a contract is unable to perform as per the contract terms due to circumstances beyond their control, this is referred to as “impossibility of performance.” In Home Design Center v. County Appliances of Naples, Inc., the court established impossibility of performance as a legitimate defense to some breach of contract claims.
5. Unconscionable Contract Terms
A contract may be considered unconscionable if the terms are unjust, unfair or outrageous. In these instances, unconscionably may be a reliable defense to breach of contract claims. In the Florida case Kohl v. Bay Colony Club, the court held that when the terms of the contract are unfair and unreasonable at the time the contract was entered into, unconscionability may be used as a defense to breach of contract claims in the Florida courts.
6. Unilateral or Mutual Mistakes
A unilateral mistake occurs when one party was mistaken about the terms of a contract at the time they entered into it. A mutual mistake happens when both or all parties of a contract were mistaken at the time the contract was signed. Under Florida law, if any party of a contract is mistaken about the terms of a contract at the time the contract went into effect, their mistake may be a legitimate defense for not performing as obligated.
If you’re being sued for breach of contract, it is imperative that you understand how to defend and protect your business and personal interests. Above we discuss a partial list of defenses that are commonly used in breach of contract claims. Depending on the facts and your circumstances, you may find one or more of these defenses applicable to your situation. You may also find additional defenses available to you that have not been covered in this article. So, do not delay. Protect your interests today.
Mark S. Schecter is the founder of Schecter Law, a South Florida law practice that emphasizes commercial litigation and real estate law in the Fort. Lauderdale area. The business law attorneys of Schecter Law have decades of experience negotiating contracts, drafting ironclad contracts for small and large businesses, as well as defending and enforcing contract terms. Retain a firm of experienced contract attorneys that specialize in business law to prepare ironclad business contracts that will protect your interests and your business.