What is a material alteration of a contract?

A material alteration of a contract occurs when one of the parties to the contractual agreement changes a fundamental term or condition of that agreement. In California, material alterations can be made as long as both parties agree to the change. However, any such material alteration must be clear and unambiguous in order to be enforceable. Material alterations are sometimes referred to as modifications. The most common situation in which material alterations occur is when a party wants to extend the term of a contract or change the payment terms. In these situations, both parties must agree and sign the modification to make it legally binding. Generally, an oral agreement to make a material alteration of a contract is not as enforceable as a written agreement. This is especially true when it comes to alterations that would significantly impact the performance and obligations of each party. In some cases, courts may refuse to enforce material alterations made through oral agreements. Though material alterations can be beneficial when they address the changing needs of both parties, they can also present risks. This is why both parties should take the time to review any changes proposed to the original contract. Additionally, both parties must ensure that the agreement is documented in writing and signed by both parties. Without a clear document that notes the material alterations, the parties may experience difficulties resolving any disputes that arise.

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