What is a material breach of contract?

A material breach of contract is when one party breaks a substantial term of the agreement without having a legal excuse. This breach is so significant that it defeats the purpose of the contract. In some cases, the breach is so severe that the injured party can be compensated for the damages resulting from the breach. In Hawaii, a breach is material when it goes against the essential purpose of the contract or results in a significant financial loss. For example, if a contractor fails to complete a building project on time, this may be considered a material breach because it goes against the essential purpose of the contract. On the other hand, a minor delay in construction, or an accidental mistake, would not constitute a material breach. Also, a breach is considered material if it results in a significant financial loss. For instance, if one party fails to deliver goods on time, the other party may have to purchase replacement stock, resulting in a significant financial loss. Overall, a material breach of contract is an act that defeats the purpose of an agreement, or that has a significant financial impact on one party. In Hawaii, it is important to review contracts carefully before signing them, and to consider the consequences of a breach before entering into a contract.

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