How To Prove A Texas No Adequate Assurances Claim
In Texas, a claim of No Adequate Assurances is defined as:
This occurs when a party denies the existence of the contract prior to the date that the performance is due. It is an excuse for non-performance by the non-breaching party. (Might also be called anticipatory breach)>
It simply means:
When one party doesn’t hold up his/her end of a contract because it appears the other party won’t. (Might also be referred to as anticipatory breach.)
There are 4 elements of the claim:
- Element 1. There was a contract between the parties. A No Adequate Assurances Claim requires that there was a formal agreement between the involved parties, meaning they had a clear understanding of their obligations and expectations in their business relationship.
Facts that might support this element look like:
* The parties exchanged signed documents outlining the terms of the agreement, including payment and delivery schedules.
* Both parties performed their respective obligations under the agreement, demonstrating mutual assent to the contract’s terms.
* Correspondence between the parties confirmed their intent to be bound by the terms discussed, indicating a clear agreement.
* The parties engaged in negotiations that culminated in a written contract, which was executed by both sides.
* Invoices and receipts exchanged between the parties reflect the existence of a contractual relationship and the agreed-upon services. - Element 2. One party refused to perform their obligation under the contract. In a No Adequate Assurances Claim, one party didn’t fulfill their part of the agreement, leading the other party to doubt whether they would meet their future obligations, which can justify seeking assurance or even ending the contract.
Facts that might support this element look like:
* The defendant explicitly stated in an email dated March 1, 2023, that they would not fulfill their contractual obligations due to alleged financial difficulties.
* On April 15, 2023, the defendant failed to deliver the agreed-upon goods, despite multiple reminders and a clear deadline outlined in the contract.
* During a phone conversation on May 10, 2023, the defendant acknowledged their refusal to perform and indicated they would not be able to meet the contract terms.
* The defendant’s actions on June 5, 2023, included canceling scheduled meetings to discuss performance, demonstrating a lack of intent to fulfill their contractual duties.
* A letter sent by the defendant on July 20, 2023, formally stated their unwillingness to proceed with the contract, citing reasons unrelated to the contract’s terms. - Element 3. The party had no just excuse for the refusal. In a No Adequate Assurances Claim, this element means that one party cannot provide a valid reason for not fulfilling their obligations, suggesting they are unfairly avoiding their responsibilities without a good explanation.
Facts that might support this element look like:
* The party was aware of the contractual obligations but failed to communicate any concerns prior to the refusal.
* The party had previously fulfilled similar obligations without issue, demonstrating capability and intent to perform.
* The party did not provide any alternative solutions or proposals to address the concerns raised.
* The refusal occurred despite multiple opportunities for discussion and negotiation regarding the terms.
* The party’s refusal was made without any documented evidence of a legitimate reason or justification. - Element 4. The refusal caused damage to the non-repudiating party. The refusal to fulfill a contract harmed the party that was relying on the agreement, as they faced losses or difficulties because the other party didn’t provide the promised assurance or support, making it harder for them to meet their own obligations.
Facts that might support this element look like:
* The non-repudiating party incurred significant financial losses due to the refusal, resulting in a 30% decrease in projected revenue for the quarter.
* The refusal led to the non-repudiating party losing a key client, which directly impacted their market position and reputation.
* As a result of the refusal, the non-repudiating party was forced to terminate contracts with suppliers, incurring additional penalties and costs.
* The non-repudiating party experienced operational disruptions, leading to delays in project timelines and increased expenses.
* The refusal caused the non-repudiating party to miss critical deadlines, resulting in lost business opportunities and diminished future earnings.
(See Philadelphia American Life Ins. v. Turner, 131 SW 3d 576 (TX Court of Appeals, 2nd Dist. 2004). Coker v. Coker, 650 S.W.2d 391, 394 (TX Supreme Court 1983). Taylor Pub. Co. v. Sys. Mktg., Inc., 686 S.W.2d 213, 217 (TX Court of Appeals, 5th Dist. 1984).)
If you’re in court without a lawyer and plan to assert a claim of No Adequate Assurances, having a Personal Practice of Law at Courtroom5 is essential. You’ll need to make informed decisions about what to file at each phase of your case and prepare legal documents supported by thorough legal research and a strong analysis of the facts. Equip yourself with the tools and knowledge to effectively navigate your legal journey.
Prove Your TX No Adequate Assurances Claim
U.S. Civil Cases Only