When someone fails to perform their obligations under a contract, you have legal remedies — including damages, specific performance, and injunctions. Understanding your options and acting within BC's strict limitation periods is essential.
A breach of contract occurs when one party to a legally binding agreement fails to perform their obligations as promised. In British Columbia, contract law is governed by common law principles and the
, and other statutes depending on the contract type.
Whether the breach is material (defeating the purpose of the contract) or minor (small failure to perform), you have legal options to recover damages or force performance. The key is understanding: what constitutes a breach, what you can recover, and how quickly you must act — BC's Limitation Act gives you two years from the date you discovered the breach to sue.
Not all breaches are equal. BC courts distinguish between material breaches (which justify termination) and minor breaches (which entitle you to damages only).
When someone breaches a contract, BC law offers several remedies to restore you to the position you would have been in had the breach not occurred.
What to Do When Someone Breaches a Contract
The moment you discover a breach — or suspect one — take action to preserve your rights and minimise your losses.
Calculating Damages for Breach of Contract in BC
Damages for breach of contract are calculated based on the principle of restitutio in integrum — restoring the innocent party to the position they would have been in had the breach not occurred. In BC, damages must be:
: a reasonably probable consequence of the breach at the time the contract was made (established in the landmark case Hadley v. Baxendale)
: capable of being calculated with reasonable certainty (speculative damages are not recoverable)
: the innocent party must take reasonable steps to minimise losses caused by the breach
: the profit or benefit you would have received had the contract been performed
: losses incurred in reliance on the contract being performed (e.g., cost of hiring temporary staff while waiting for breached performance)
: indirect losses that flow from the breach (e.g., business interruption, lost client relationships) — only if foreseeable
A critical principle in BC contract law is that the innocent party is required to mitigate — to take reasonable steps to reduce the loss caused by the breach. For example, if a supplier breaches by failing to deliver goods, you must attempt to source replacement goods from another supplier, even at a higher cost. If you do not mitigate, the court will reduce your damages by the amount you could have saved had you taken reasonable steps.
Breach of contract disputes rarely fit a simple mold. Here are practical scenarios that illustrate how BC courts and lawyers approach common breach situations — and what your options actually are.
You contracted with a supplier to deliver 500 units of widgets by March 1 for a customer order due March 15. The supplier delivers nothing by the deadline and informs you they cannot fulfil the order. Your customer cancels the deal and sues you for lost profit.
Material breach — the entire purpose of the contract (timely delivery) failed.
Sue the supplier for the difference between their contract price and the higher price you paid an emergency replacement supplier
Claim any additional losses flowing from the breach (e.g., reputational harm, customer relationship loss)
Pursue Small Claims Court if damages are under $35,000
Once the supplier failed to deliver by the deadline, you had a duty to mitigate. Waiting and hoping they would eventually deliver could reduce your damages. Document immediately that you contacted alternative suppliers and began procurement to minimise losses.
You hired a contractor to complete a home renovation by June 30 for $75,000. Work begins on time, but the contractor falls behind, makes poor-quality repairs, and abandons the site in early July with 40% of the work remaining and no explanation.
Material breach — failure to complete the work, poor quality, and abandonment.
Hire a replacement contractor to complete the remaining work
Claim loss of use of the home if the condition is uninhabitable
Document everything — photos of incomplete work, poor quality, emails/texts requesting performance, the abandonment date. Get written quotes from at least two replacement contractors showing the cost to complete. This evidence is essential in court.
Scenario 3: Professional Services — Negligent or Incomplete Work
You hired an accounting firm to prepare your corporate tax return and manage payroll. They fail to file the return on time, and Revenue Canada assesses penalties and interest. They also mis-calculated payroll deductions, and you are personally liable for the shortfall.
Breach of contract (failure to perform as agreed) and potentially professional negligence.
Demand they correct the filings and reimburse penalties, interest, and your personal payroll liability
If they refuse, sue for breach of contract
negligence — you can pursue both claims
Claim the accountant's professional liability insurance as a defendant if the firm is uninsured or judgment-proof
These claims often exceed Small Claims limits ($35,000) due to accumulated penalties and interest. You will likely need BC Supreme Court. Get a lawyer promptly — professional negligence claims require expert evidence to establish the standard of care.
Scenario 4: Partial Performance — Damages When Work Is Deficient
A contractor completes a kitchen renovation. The cabinets are installed, the countertops are in place, but the paint is sloppy, two cabinet doors don't close properly, and the backsplash has grout lines that are uneven. The total cost was $30,000. Repairs would cost $4,000.
Minor breach (work completed but with deficiencies) — you cannot terminate, but you can sue for damages.
Withhold the final payment (or portion thereof) to secure performance of repairs
Demand the contractor fix the deficiencies at no cost
If they refuse, hire another contractor to fix the issues and sue for the repair cost
If the deficiencies significantly reduce the home's value (rare), you might claim diminution in value instead of repair cost
Do NOT pay the contractor in full until defects are corrected. Once you've paid, your leverage is gone. Also, be realistic — courts award the lesser of (a) cost to repair or (b) diminution in value. Suing over a $4,000 repair cost may not be worth the legal fees.
The Two-Year Limitation: Why Timing Is Crucial
BC's Limitation Act imposes a strict 2-year deadline. This clock starts from the date you
the breach — not the date of breach itself. In a supplier non-delivery case, that might be the delivery deadline. In a professional negligence case, it might be the date you discovered the error (which could be months or years after the work was done).
There is no grace period, no extension for negotiation, and no "give them time to fix it" exception.
Once 2 years pass, your right to sue is extinguished forever. If you suspect a breach, get legal advice immediately — do not wait to see if the other party will voluntarily fix it.
For every scenario above, the successful claimant took these three actions:
— email, letter, or text contemporaneously describing what went wrong
— sent the breaching party a clear written request to fix the problem within a reasonable timeframe
— took reasonable steps to minimise harm (sourced alternatives, hired replacements, got repair quotes)
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BC's 2-year limitation period moves fast. Whether you're pursuing a breach claim or defending against one, early advice protects your options and maximizes your recovery.
This page is for general information only and does not constitute legal advice. Limitation periods in BC are strict — always consult a qualified BC lawyer promptly if you believe a contract has been breached.