donelber said:
I was reading an old Agreement to Purchase and Sell and came across the wording regarding the buyer to obtain a loan and have downpayment. The sentence in question is as follows: "Purchaser's failure to either apply for said loans or to have the stated down payment does not void this contract but shall be considered a breach thereof". What is the difference? Does a breach break the contract? If so, wouldn't that void the contract? Just curious. By the way, the buyer in this transaction did not have the money for a downpayment. They kept postponing until their church finally came up with the funds. We waited because they were young, first-time homebuyers. Could we have backed out if we wanted to because of this wording?
My response:
To "void" a contract means the same as if the contract never existed, and all clauses, terms and conditions are just so much "vapor", i.e., there is no way to cure the problem.
To "breach" the contract mean that the contract continues to exist, and leaves the agreived party with the ability to exercise remedies; e.g., waiver, damages, late fees, accellations, etc.
A "breach" is another way of saying "breaking". Every breach, however, does not mean the contract terms are automatically unenforceable. A party may, as you did in your example, "waive" the breach and allow the other party to "cure" the problem - - in the hopes of keeping the contract alive.
There are innumerable reasons that a contract can be breached, voided, or become "voidable" - - from a failure on a party's part, or a failure of consideration, and not limited to, statutory reasons.
These are just basic examples, and there are much finer, and much more complicated, examples and scenarios.
IAAL
