Breach of contract is a cause of action or claim in civil litigation (lawsuits) that provides the legal basis for a person or entity to recover its damages/losses when another person or entity breaches an enforceable written or verbal agreement (contract) by breaking one or more promises in the agreement.
In New Mexico, a breach of contract occurs when one party fails to fulfill their obligations under a binding agreement, whether the contract is written or verbal. To pursue a breach of contract claim, the aggrieved party must demonstrate that a valid contract existed, that they fulfilled their own contractual obligations or had a valid reason for not doing so, that the other party failed to fulfill their contractual obligations, and that this failure resulted in damages. New Mexico follows the 'reasonable person standard' for determining breaches, meaning the actions of the breaching party are measured against what a reasonable person would have done under similar circumstances. The statute of limitations for breach of contract in New Mexico is generally four years for written contracts and four years for oral contracts, starting from the date the breach occurred. If the court finds that a breach has occurred, the non-breaching party may be awarded damages to compensate for the losses incurred due to the breach.