Fundamental Breach

A fundamental breach of contract occurs when one party fails to fulfill their core obligation, making it impossible for the other party to receive the essential benefit of the agreement. This type of breach is so serious that it undermines the very purpose of the contract, allowing the wronged party to terminate the contract and seek damages. For example, if a contractor fails to build a home despite being paid, this could be considered a fundamental breach, as the homeowner is deprived of their main expectation from the contract.