Breach of Contract Demand Letter - California

DEMAND LETTER - BREACH OF CONTRACT

State of California

[LAW FIRM NAME]
Attorneys at Law
[FIRM ADDRESS]
[CITY], California [ZIP]
Tel: [TELEPHONE]
Fax: [FAX]
State Bar of California No. [BAR NUMBER]

SENT VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED
AND FIRST-CLASS U.S. MAIL

[DATE]

[RECIPIENT NAME]
[RECIPIENT TITLE]
[COMPANY NAME]
[ADDRESS]
[CITY, STATE ZIP]

Re: Formal Demand - Breach of Contract
Contract Date: [DATE]
Our Client: [CLIENT NAME]
Demand Amount: $[TOTAL]

Dear [RECIPIENT NAME]:

This firm represents [CLIENT NAME] ("our Client") regarding the above-referenced agreement (the "Contract") between our Client and [BREACHING PARTY NAME]. You have materially breached the Contract, and we demand immediate cure and full compensation for damages.

THIS IS A FORMAL DEMAND UNDER CALIFORNIA LAW. UNDER CALIFORNIA CIVIL CODE SECTION 1717, ANY ATTORNEY FEE PROVISION IN THE CONTRACT IS RECIPROCAL. IF OUR CLIENT PREVAILS, YOU WILL BE LIABLE FOR SUBSTANTIAL ATTORNEY FEES.

I. BACKGROUND AND CONTRACTUAL RELATIONSHIP

On or about [CONTRACT DATE], our Client and [BREACHING PARTY NAME] entered into the Contract. Under the terms of that agreement:

1. Nature of Agreement: [DESCRIBE]
2. Client's Obligations: [DESCRIBE]
3. Your Obligations: [DESCRIBE]
4. Consideration: [DESCRIBE]

Our Client has fully performed all material obligations, or was ready, willing, and able to perform.

II. YOUR MATERIAL BREACH

You have materially breached the Contract as follows:

☐ Breach #1: [DESCRIBE BREACH AND CITE CONTRACT PROVISION]
- Contract Section [X] provides: "[QUOTE]"
- Your conduct: [DESCRIBE]

☐ Breach #2: [DESCRIBE]

☐ Breach #3: [DESCRIBE]

Prior Notice and Failure to Cure

☐ On [DATE], our Client provided notice and demand for cure. You failed to cure.
☐ The Contract does not require cure opportunity before legal action.

III. LEGAL BASIS UNDER CALIFORNIA LAW

A. Breach of Contract

Under California law, the elements of breach of contract are:
1. Existence of a contract;
2. Plaintiff's performance or excuse for nonperformance;
3. Defendant's breach; and
4. Damages caused by the breach.

See Oasis West Realty, LLC v. Goldman, 51 Cal. 4th 811, 821 (2011).

B. Implied Covenant of Good Faith

California law implies a covenant of good faith and fair dealing in every contract. See Carma Developers (Cal.), Inc. v. Marathon Dev. Cal., Inc., 2 Cal. 4th 342 (1992). Your conduct violates this implied covenant.

IV. DAMAGES UNDER CALIFORNIA LAW

A. Compensatory Damages

California Civil Code section 3300 provides that damages for breach of contract are "the amount which will compensate the party aggrieved for all the detriment proximately caused thereby."

B. Prejudgment Interest

Under California Constitution Article XV, Section 1, and Civil Code sections 3287-3288, prejudgment interest accrues at 10% per annum on liquidated damages from the date the obligation became due.

C. Attorney Fees Under Civil Code Section 1717

California Civil Code section 1717 provides:

"In any action on a contract, where the contract specifically provides that attorney's fees and costs... shall be awarded either to one of the parties or to the prevailing party, then the party who is determined to be the party prevailing on the contract... shall be entitled to reasonable attorney's fees..."

[IF CONTRACT HAS FEE PROVISION:] Section [X] of the Contract provides for attorney fees. Under Section 1717, this provision is reciprocal. Our Client is entitled to recover attorney fees, currently estimated at $[AMOUNT] and increasing.

D. Total Damages Summary

V. STATUTE OF LIMITATIONS

☐ Written Contract: Under Code of Civil Procedure section 337, claims must be brought within 4 years of breach.

☐ Oral Contract: Under Code of Civil Procedure section 339, claims must be brought within 2 years of breach.

Our Client's claims are well within the applicable limitations period.

VI. DEMAND

Within [30] calendar days of your receipt of this letter:

☐ Cure the breach by [SPECIFIC ACTIONS]; AND/OR

☐ Pay $[TOTAL DEMAND AMOUNT], representing compensatory damages, interest, and fees.

Payment should be made by certified check payable to [PAYEE NAME] or by wire transfer to:

Bank: [BANK NAME]
ABA/Routing: [ROUTING]
Account: [ACCOUNT NUMBER]
Reference: [REFERENCE]

VII. CONSEQUENCES OF NON-COMPLIANCE

If you fail to satisfy this demand, our Client will file suit immediately in the [Superior Court of the State of California, County of [COUNTY] / United States District Court for the [Northern/Central/Southern/Eastern] District of California], seeking:

1. All compensatory, consequential, and incidental damages;
2. Prejudgment interest at 10% per annum;
3. Attorney fees under Civil Code section 1717;
4. Costs of suit;
5. Punitive damages if warranted (Cal. Civ. Code section 3294);
6. Any other relief the court deems just.

VIII. DOCUMENT PRESERVATION

You are legally obligated to preserve all documents and ESI relating to this dispute. California courts impose sanctions for spoliation. See Cedars-Sinai Medical Center v. Superior Court, 18 Cal. 4th 1 (1998).

IX. RESERVATION OF RIGHTS

Our Client reserves all rights, claims, and remedies at law and in equity.

We remain available to discuss resolution. However, absent a satisfactory response, litigation will follow.

Govern yourself accordingly.

Very truly yours,

[LAW FIRM NAME]

By: _______________________________
[ATTORNEY NAME]
State Bar of California No. [BAR NUMBER]

Enclosures:
☐ Exhibit A - Contract
☐ Exhibit B - Damage Calculations

cc: [CLIENT NAME]