Violation: Overview, definition and example
What is violation?
A violation refers to the act of breaking or failing to comply with a rule, law, or agreement. In contracts, it occurs when one party does not follow the agreed-upon terms, whether it’s failing to meet a deadline, not delivering goods, or violating specific conditions outlined in the agreement.
Why is violation important?
Understanding violation is important because it helps identify when a party has failed to uphold their end of the agreement. It also determines the consequences, such as penalties, legal actions, or termination of the contract. Recognizing and addressing violations quickly ensures that businesses can protect their interests and avoid unnecessary risks.
Understanding violation through an example
Imagine a business, RetailCo, that enters into a lease agreement with a landlord. The lease specifies that RetailCo must pay rent on the first of every month. If RetailCo fails to make a payment on time, this would be considered a violation of the lease agreement. Depending on the terms, the landlord may be able to charge late fees or even terminate the lease.
In another case, a supplier might violate a contract by failing to deliver products by the agreed date, causing delays for the buyer. This breach could result in financial penalties or a claim for damages.
Example of a violation clause
Here’s how a violation clause might look in a contract:
“If either party fails to perform any material obligation under this Agreement within thirty (30) days after receiving written notice of the breach, the non-breaching party may terminate this Agreement and seek remedies as outlined in this Agreement.”
Conclusion
Violation refers to the act of not following the terms or conditions of an agreement, whether it’s a minor breach or a major default. It is essential to recognize violations early to protect your business and address the issue promptly. Having clear violation clauses in contracts helps set expectations and consequences, ensuring smoother business relationships.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.