Minnesota Breach of Contract Lawyers

The experienced breach of contract attorneys at Heimerl & Lammers can clarify your legal options and effectively represent you in a Minnesota breach of contract case. To learn more about how Heimerl & Lammers can help you, contact us for a free consultation by calling (612) 294-2200.

What Is A Breach Of Contract?

A breach of a contract means that one party failed to fulfill the obligations and conditions, written or oral. Employers will attempt to sue employees for breaching any agreement, including employment agreements, non-compete agreements, and severance agreements. Fortunately, the attorneys at Heimerl & Lammers are here to help and can guide you through the process.

What Are The Elements Of A Breach Of Contract Claim?

In Minnesota, to be successful in court on a breach of contract claim, a plaintiff must show the following four elements:

  • There was the formation of a valid contract
  • The plaintiff fulfilled its contractual duties
  • The defendant failed to perform its contractual duties, and
  • That the plaintiff must show with reasonable certainty the damages they sustained

What If I’m Offered A Take It Or Leave It Agreement?

In Minnesota, it is known as an adhesion contract when one party has all the power and forces a weaker party to sign the agreement without the opportunity to negotiate. While employers may present agreements as a take-it-or-leave scenario, never buy into it. Always review and negotiate first. If you would like help knowing what can be negotiated and how it should be negotiated, you can contact Heimerl & Lammers to help by calling us at (612) 294-2200.

Formation Of A Valid Contract

Essentially, the plaintiff must prove that the parties agreed to something and that it was valid. A valid contract requires the following.

  • Offer. An offer in this circumstance is the employer giving you an offer for employment with a salary and expectations of that employment.
  • Acceptance. Acceptance is the actual acceptance of the agreement, such as signing the agreement. Silence cannot be treated as acceptance in this situation.
  • Consideration. Consideration is the benefit to the person who has the obligation or who makes a promise to do something.
  • Intention to create a legal relationship. If the material components of the agreement are not laid out, then it will be invalidated. In contrast, an agreement does not necessarily need to be worked out in meticulous detail to be valid.
  • Legality and capacity. A contract cannot be valid if it violates the law.

Generally, if you have a signed agreement that meets the above, that is usually sufficient in proving that there was the formation of a valid agreement. However, you do not need to write out all agreements. Some employment agreements are oral, or an oral agreement modifies the written agreement. Keep in mind certain oral contracts violate the Statute of Frauds.

Statute Of Frauds

Minnesota law provides that oral contracts that last longer than one year are invalid under the law. Yet, this means that if you enter an employment contract for six months, you can do so orally. However, if it is for two years, it must be in writing to be found valid in a court of law.

Plaintiff Fulfilled Their Duties

Under an agreement, each party must do something. Therefore, if both parties fail to perform their obligations, courts cannot hold one party to have breached the contract. On the other hand, suppose the employment agreement provides that the employer will pay the employee a signing bonus of $50,000 within 30 days of the Agreement Date, and the employee must start work within 60 days of the Agreement Date. If the employee fails to start on the 60th day, the employer must show that they paid the employee the signing bonus on time.

Defendant Failed To Perform Their Duties

The plaintiff has the burden of proving that the defendant did not fulfill their duties and breached the agreement.

Damages

To have a successful breach of contract claim, the plaintiff must show that they sustained damages or will reasonably sustain damages. If an employee breached their employment contract and went to another company, if the employer did not and will not sustain any damages, they cannot seek monetary damages. Additionally, a court will not generally implement specific performance concerning an employment agreement because they do not want to force someone to work somewhere they do not want.

Vague, Unclear, Or Ambiguous Contract

If the agreement you entered into with your employer is vague, unclear, or ambiguous, the court will likely find it unenforceable. However, sometimes judges will look at evidence outside the contract to interpret what an ambiguous term was meant to be. Fortunately, ambiguous terms are likely interpreted against the drafter (i.e., employer in this case).

MN Employment Lawyers For Breach of Contract

Do you think your employer committed a breach of contract against you? Contract disputes can be difficult and time-consuming to manage on your own. Therefore, it is essential to have an experienced attorney analyze your potential breach of contract lawsuit and help you determine the best course of action. Contact the employment attorneys at Heimerl & Lammers to discuss your contract dispute and how an employment contract breached by your employer can entitle you to compensation and other damages.

What Happens If You Expect An Employer to Breach A Contract?

If you expect your employer to breach a contract with you, this is known as an anticipatory breach. At its core, the other party refuses to perform or will be unable to perform. Imagine you are offered a position in the company’s New York office and then are disallowed from conducting business there, you will not be able to perform the contract. If you think this is the case for you and your employer, you can seek assurance that the other party will fulfill their end.

Under Minnesota law, you must have reasonable grounds to believe that the other party will breach the agreement to get the assurance. If the employer fails to provide you with adequate assurance within 30 days of your request, you can declare that the contract has been breached and bring suit against the employer.

Defenses To A Breach Of Contract Claim

You can easily utilize several defenses in a breach of contract claim, including:

  • Statute of limitations
  • Fraud in the inducement
  • Duress
  • Impossibility of performance
  • Mutual or unilateral mistakes

Statute Of Limitation

The statute of limitations provides when you may bring a claim after a party breaches a contract. In Minnesota, the statute of limitations for any contract-based claim is six years, including breach of contract. For a breach of contract claim, the statute of limitations begins to tick the moment the breach occurs unless there was an act to conceal the breach. If the employer breached the contract but hid the breach, you will have six years to file a claim from the date you discovered the breach.

Fraud In The Inducement

Let’s say your employer sues you for breach of contract for a contract they fraudulently induced you into entering. If so, this is a valid defense that will get the breach of contract lawsuit dismissed.

Duress

Duress is when you enter an agreement based on coercion or threats. The court will find that the agreement is inequitable and unenforceable if both parties did not enter into it voluntarily. For example, you have a duress defense if the other party threatens to blacklist your career unless you enter an employment agreement with them or a non-compete agreement.

Impossibility Of Performance

The impossibility of performance defense means that you cannot possibly perform under the contract because of something that is beyond your control. Imagine if you become disabled or there is the destruction of some necessary property required for performing the contract. Imagine if a change in law makes it illegal to perform the contract. In either scenario, you can raise this defense to avoid a breach of contract claim.

An example of a law changing is if Minnesota made the distribution of marijuana legal and a new marijuana distributor in Minnesota hired you. Suppose you entered into an employment contract with that distributor. Then courts overturn the Minnesota law, making it illegal to distribute marijuana. In this case, you cannot legally perform your employment contract. Therefore, the other party cannot sue you for breaching the contract.

Mutual Or Unilateral Mistakes

A mistake about a material term or condition of the contract, whether mutual or unilateral, could potentially be a defense.

Mutual Mistake

A mutual mistake occurs when both parties incorrectly believe an essential fact about the contract. Generally, a mutual mistake will invalidate an agreement.

Unilateral Mistake

A unilateral mistake occurs when one party makes a mistake. Generally, this will not invalidate an agreement unless it was a mistake about a material item and was a reasonable mistake.

What Damages Can I Get In A Breach Of Contract Case?

There are many categories of damages you may seek in a breach of contract case in Minnesota, including:

  • Liquidated Damages
  • Direct Damages
  • Consequential Damages
  • Incidental Damages
  • Punitive Damages
  • Attorneys’ Fees

Liquidated Damages

Liquidated damages generally come directly from the contract itself. A contract may say that the employee will receive $10,000 in liquidated damages if an employer defaults under the employment agreement. For courts to find that they can award liquidated damages, you must show the following criteria:

  • The amount must be fixed and a reasonable forecast of fair compensation for the harm the breach causes, and
  • Actual damages are difficult to ascertain

Therefore, if reasonable damages you can sustain from a breach of the employer is $10,000, and the contract says $50,000, that provision will be unenforceable. Courts will not enforce a liquidated provision if the goal is to punish one party instead of awarding just compensation to the injured party.

Direct Damages

Direct damages are those that come directly from the breach. For example, if you lose a $10,000 bonus because of the employer’s contract, the non-breaching party will receive $10,000 in indirect damages.

Consequential Damages

A breach may cause consequential damages. They occur when one party’s failure to perform leads to other reasonably foreseeable issues, such as loss of customers. They may include monetary damages because of a loss of use of an asset, property damage, lost profits, loss of goodwill, cost of substitute labor or property, breach of other contracts, personal injury damages, and other collateral losses. For Minnesota courts to award consequential damages, these damages must be reasonably foreseeable to the parties during the breach.

Incidental Damages

Incidental damages are damages the non-breaching party incurs to avoid consequential damages or other losses. This may include the cost difference in hiring a replacement. These damages are unlikely to occur in employment, non-compete, or severance agreements. Still, they are expenses reasonably incurred in receipt and custody of a product.

Compensatory Damages

Compensatory damages ask what will make the plaintiff whole had the breaching party not breached. Say that the other party told you they’d reimburse you for moving expenses upon receipt. Yet, the company failed to compensate you. If you paid with a credit card and received interest fees from it sitting on your card, the court could refund you the moving costs plus any interest fees you incurred due to the employers’ failure to pay to reimburse you promptly. This would make you whole again.

Punitive Damages

Courts do not tend to award punitive damages in a breach of contract claim. Therefore, there must be other claims included in your lawsuit (i.e., defamation, discrimination, etc.). Furthermore, you must win on one of these other claims first. Winning other damages opens the door for you to pursue punitive damages. If you are eligible to receive punitive damages, they can be significant because courts award them to “hurt” a company and teach the company a lesson.

Under Minnesota law, to be awarded punitive damages, you must show that there was a deliberate disregard for the rights or safety, and you cannot include them in your complaint. When considering awarding punitive damages, a judge or jury will look at the following factors:

  • The seriousness of hazard to the public arising from the defendant’s misconduct,
  • The profitability of the misconduct to the defendant
  • the duration of the misconduct and any concealment of it,
  • The degree of the defendant’s awareness upon discovery of the misconduct,
  • The attitude and conduct of the defendant upon discovery of the misconduct,
  • The number and level of employees involved in causing or concealing the misconduct,
  • The financial condition of the defendant, and
  • The total effect of other punishment likely to be imposed upon the defendant as a result of the misconduct

Attorneys’ Fees

Courts do not tend to award attorneys’ fees. Therefore, an employer will insert an attorneys’ fees provision to ensure that an employee bears all of the cost of litigation, if possible. If the non-compete agreement does not contain an attorneys’ fees provision, Minnesota does not allow for the prevailing party to shift their attorney fees to the counterparty.

Employment Attorney In Minnesota

If an employer sues you or someone you know for a breach of contract, you must hire an experienced and knowledgeable attorney to represent you and your rights tenaciously. The attorneys at Heimerl & Lammers can help you understand the claims being brought against you and ensure that your employer is not able to ruin your career or reputation.

At Heimerl & Lammers, we have the knowledge and experience to protect your rights under a non-compete agreement and ensure that an employer does not take advantage of you. For a free, confidential consultation, call us at (612) 294-2200.

Breach Of Contract

Breach of Contract

Employers will sometimes try to avoid the obligations to which they made a commitment in your employment contract or sales commission plan. If your employer failed to pay a promised sales commission, fires you for cause that did not occur, or refused to pay the severance outlined in your contract, we may be able to help.

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