Efficient Breach of Contract - Explained
What is an Efficient Breach?
Written by J. Mance Gordon
Updated at April 19th, 2024
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What is Efficient Breach?
Efficient breach occurs when a party makes a conscious decision to breach a contract after balancing the costs of complying against fulfilling the contractual obligation. This normally arises in situations where a party will incur fewer losses or make more money by breaching the contract than the party would suffer in compensatory or consequential damages if sued.
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