Four Cornerstones that Constitute a Contract Breach

It can be beyond frustration for an individual or individuals to put hours of work into a construction project, only to not be paid. Whether this was from a breach in a business contract or not, it is good to understand several aspects of a business contract as well as a few laws, at least through the lens of construction laws. Knowledge is certainly power.

A Business Contract Has Been Breached

Every state has varying degrees on what constitutes a breach of contract. However, there are always some tenants that most, if not all, follow. In order to move on a breached business contract, one must produce four cornerstones of the claim, simplified like this: contract, performance, breach and damages. This is a general breach of contract, not just specific to construction. It is recommended you employ a business lawyer.

The first cornerstone is the claim. Was there a contract, verbal or written? A written contract with verifiable signatures is far superior to a verbal contract, but a verbal agreement can work as well.

The second cornerstone is performance. If you did the job as intended, and there is evidence to corroborate your performance, then your claim has been strengthened. You can continued onto the third cornerstone.

The third cornerstone is breach. If you did the job as intended, and the owner did not pay, then a breach has been made. In fact, Nevada Prompt Payment Laws state an owner has to pay a contractor within 21 days after an invoice was received. This can vary, of course, depending on the agreement that was made. However, if the stated number of days were met without pay, a breach has been made, especially if there is no attempt at communication. This can work the other way around as well. If you, the owner, employed a company under a legal contract, and they not do the job as stated in said contract, they are in breach of contract. You can continue onto the fourth cornerstone.

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The last cornerstone is damages. Let us say you complete a contract and the owner does not pay. If you and your employees are not paid, this could be considered “liquidated damages.” This opens a can of worms known as worker’s compensation.

Worker’s Compensation and Unpaid Leave

Regardless of what some might have you believe, worker’s compensation is a good thing. If an employee is injured on the job, even when safety protocols are followed, an employee can be compensated. That is not to say worker’s compensation is not taken advantage of–far from it–but for the majority of worker’s compensation claims, you can bet the individuals were not injured by malicious means. In fact, many worker’s compensation claims are made from slippery floor accidents, as many as 85 percent.

Worker’s compensation is almost required in all states, up to 74 percent now. If you received worker’s compensation, you should also know that you have the right to take up to 12 weeks of unpaid leave for family reasons according to the Family Law and Medical Leave Act.

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