Material Breach, Substantial Performance

There’s a distinction between a breach of contract and a material breach of contract. Depending on the legal situation, the distinction is quite significant. For example, if a party first materially breaches the contract, the party may not be able to sue subsequently to enforce the contract. The reasoning is that if they don’t follow the contract they themselves shouldn’t be able to invoke it.

What is a “material breach”?  A “material” breach is when “the breach relates to a vital provision of the agreement, i.e. one that goes to the very substance or root of the agreement and cannot relate simply to a subordinate or incidental matter.” Patel v. Patel, 128 S.W.3d 873, 878 (Mo. Ct. App. 2004). A de minimis breach, in contrast, is when the breach “does not destroy the purpose or the value of the contract.” Curt Ogden Equipment v. Murphy Leasing, 895 S.W.2d 604, 609 (Mo. Ct. App. 1995).

Substantial performance of a contract is a related concept. It is a defense to a breach of contract claim. Specifically, it applies when the defects in performance are slight in the context of the transaction. Hearth Related Services v. Golden Plains, 806 S.W.2d 102, 104 (Mo. Ct. App. 1991). In other words, substantial performance is performance without a material breach. Fire Sprinklers v. Icon Contracting, Inc., 279 S.W.3d 230, 233-34 (Mo. Ct. App. 2009).

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