QUESTION
Have a written agreement for loan to be paid back with installment schedule. Party refuses to pay agreed payments . Can I sue for Breach of Contrac.t
Asked on May 11th, 2015 on Breach of Contract - New Jersey
More details to this question:
Agreed to pay $100.00 every two weeks until paid in full. $2300. Only made one payment of 100.00. Party wants to pay $50.00. Agreement states $100.00 if not paid on time a $5.00 per day charge is added to outstanding balance. I like to terminate this agreement on the grounds of Breach of Contract and demand payment in full.
1 ANSWER
You can sue for breach of contract, however, unfortunately, you don't have any acceleration provision in there ("In the event of a default in making payment, the entire balance shall immediated become due and owing."), so that you may have to sue over and over again as each payment is defaulted on, or you can sue on a few at a time, but the full amount won't be due for almost a year. If you still had any obligations to perform under the contract, you might be able to rescind it due to a material breach by the other side, but not in this situation. Also, $5 per day charge is probably unenforceable, and may even void the entire agreement. It doesn't meet the requirements of a valid liquidated damages provision, and it amounts to over 1800% annual interest on the $100, which is usurious.
Answered on May 12th, 2015 at 11:00 AM