The Complexity of Contract Breaches

An examination of a contract can be among the most expansive discussions in the legal world. This is because virtually every agreement is a contract. For example, when you move into an apartment and sign a lease you are entering into a contract. Most people realize this. However, most people do not realize that when the renter has the electricity n the apartment turned on, the renter is entering into a contract with the utility company. Yes, an electric bill is a contract. The utility company has agreed to provide electricity to a customer who has agreed to pay for the services in a timely manner. However, there is a huge difference between the contractual wording and obligations of a lease and that of an electric bill. And, of course, a 300 page contract that guarantees a major league baseball player $300 million dollars a year is in a whole other world as far as contracts go.

Regardless of the size and scope of a contract, a contract will always be defined by its basic elements. At its most basic level, a contract is an agreement between two or more individuals or entities. The agreement states that each party is bound to perform specific duties and tasks. (E.G. A lease agreement would bind a landlord to provide a dwelling and the tenant is bound to pay monthly rent) There are various forms a contract can take including oral or in writing. In some cases, a contract can merely be implied. Depending upon the type of contract the parties enter into, enforcement of the contract can be strict or lax.

More "serious" contracts are generally drawn up as a contract written under seal. The name derives from old English tradition where a royal seal was fixed to a contractual agreement. In modern times, a notary seal or other such stamp would be used. This would infer the importance of the agreement. Hence, a modern contract written under seal is also one considered to be highly important. Because of this, the contract is considered automatically enforceable if even a minor breach occurs. There will be no debate over the enforcement of the contract as there is no language in the contract that is vague or implied. The parties to the contract are expected to hold their end of the bargain with no modifications on what has been agreed upon and stated in the contract. This type of contract would be far stricter than an implied oral contract or another type of agreement.

Pennsylvania Statute of Limitations

Granted, no matter how well written a contract is there will be those who breach the agreement. In such instances, it is possible to seek legal remedy to enforce the contract. However, the ability to seek legal remedy is not open-ended. That is, there are statutes of limitations in place which provide a deadline for initiating legal action. As there are different contracts, it should come as no surprise that there are different statutes of limitations for different types of contracts. In the state of Pennsylvania, the statute of limitations for breach of contract is four years. This includes both oral and written contracts. In the contract is written under seal, however, the statute of limitations is much, much longer. Specifically, the Pennsylvania statute of limitations for a contract written under seal is 20 years. This is to ensure that expansive contractual agreements are not treated flippantly or with contempt. To do would undermine the value of any contract and such actions could create instability in the private sector. Hence, the statute of limitations for contracts written under seal is significantly lengthy.