Section 22-701 - Breach of contract; material breach. - Maryland Statutes

§ 22-701. Breach of contract; material breach.
 

(a)  In general.- Whether a party is in breach of contract is determined by the agreement or, in the absence of agreement, this title. A breach occurs if a party without legal excuse fails to perform an obligation in a timely manner, repudiates a contract, or exceeds a contractual use term, or otherwise is not in compliance with an obligation placed on it by this title or the agreement. A breach, whether or not material, entitles the aggrieved party to its remedies. Whether a breach of a contractual use term is an infringement or a misappropriation is determined by applicable informational property rights law. 

(b)  Material breach.- A breach of contract is material if: 

(1) The contract so provides; 

(2) The breach is a substantial failure to perform a term that is an essential element of the agreement; or 

(3) The circumstances, including the language of the agreement, the reasonable expectations of the parties, the standards and practices of the business, trade, or industry, and the character of the breach, indicate that: 

(A) The breach caused or is likely to cause substantial harm to the aggrieved party; or 

(B) The breach substantially deprived or is likely substantially to deprive the aggrieved party of a significant benefit it reasonably expected under the contract. 

(c)  Cumulative nonmaterial breaches.- The cumulative effect of nonmaterial breaches may be material. 
 

[2000, ch. 11.]