Understanding How Breach Of Contract And Negligence May Overlap

Posted on: 28 April 2020

When people think about the legal concept of negligence, it's normal for them to mostly imagine cases involving accidents, personal injuries, medical mistakes, and defective products. A negligence attorney can help clients with a lot more than just those types of problems. Contract law, especially the notion of breach of contract, sometimes overlaps significantly with negligence. To help you understand these issues, let's take a closer look at the intersection of those two concepts.

Setting Up an Example

Suppose a company paid a third party to code the software for its security system. The software development firm enters into a contract, and they do, in fact, deliver the desired code.

Now, take the supposition one step further. It turns out the code was poorly written, leaving several easily exploitable holes that hackers subsequently used to break into the company's secured systems. The company ends up dealing with months of customer complaints, financial losses, and bad press.

Was the Contract Breached?

At first blush, you might think there wasn't a breach of contract. After all, the software firm did deliver a product.

However, American contract law assumes that contracting parties have clear expectations for quality and safety when they enter into agreements. If you paid a contractor to build a deck, for example, you don't expect them to just nail together a bunch of boards in a haphazard manner and call the job done. The failure to deliver a job to a reasonable expectation of quality breaches the contract.

Is It Negligence?

Circling back to the original example involving software, a negligence attorney will have to invest some effort to show that the failures rise to the level of negligence. They may need to interview and depose expert witnesses who've written similar code.

The goal in these depositions would be to establish that a competent professional under similar circumstances should have known to tighten up their work to prevent trouble.

Who Is Liable?

Most contracts should be written to limit liability. Notably, gross negligence and wanton disregard aren't covered by liability limitations.

In other words, the law understands that some types of oversights may occur. The software firm might be able to limit liability if the security failure involved one or two obscure sections of the system. On the other hand, the presence of rampant flaws throughout the system would open questions about if security testing had even been a priority for the contractor.

To learn more, contact a negligence attorney.