Breach of Contract

Earnest money deposit

A deposit made by the buyer to demonstrate commitment and provide protection for the seller.

Contract

A legally binding agreement between two or more parties that outlines their rights and obligations.

Partial performance

Accepting incomplete fulfillment of the contract's terms and conditions.

Punitive damages

Additional payment awarded in excess of compensatory damages, but rarely granted in breach-of-contract lawsuits.

Liquidated damages

Agreed-upon damages that the buyer must pay if they breach the contract.

Mutual rescission

An agreement between both parties to cancel the contract.

Damages

Monetary compensation awarded to the innocent party to cover the losses suffered due to the breach.

Compensatory damages

Payment made to the innocent party to compensate for the actual loss suffered based on the value of the contract.

Termination

The act of ending a contract before its completion.

Specific performance

The legal remedy that forces the parties to fulfill their promises as stated in the contract.

Guilty party

The party who has breached the contract by failing to fulfill their obligations.

Innocent party

The party who has not violated the terms of the contract and is not responsible for the breach.

Rescind

The unilateral cancellation of the contract by one of the parties involved.

Breach of contract

When one party fails to fulfill their contractual obligations as stated in the agreement.