What Happens When a Contract is Broken: Understanding Breach of Contract

When one party fails to perform their obligations under a contract, it is known as a Breach of Contract.

Let's break down why:

• Breach of Contract (A): This is the correct answer. A breach occurs when a party to a contract doesn't fulfill their part of the agreement without a legal excuse. This could mean failing to deliver goods, provide services, or make payments as agreed.

• Assignment (B): Assignment involves transferring contractual rights and obligations from one party to another. It doesn't describe a failure to perform.

• Novation (C): Novation is the replacement of an existing contract with a new one, often involving a new party. It's not directly related to non-performance.

• Waiver (D): A waiver is a voluntary relinquishment of a known right or claim. While it can be relevant to contracts, it doesn't define the act of non-performance itself.

Understanding breach of contract is crucial for anyone entering into agreements. It's important to know your rights and options if a party fails to meet their contractual obligations.