Anticipatory Breach

Anticipatory breach (also called anticipatory repudiation) is a common-law contract doctrine recognizing that a party need not wait until the date of performance to sue when the counterparty has clearly indicated it will not perform. The repudiation can be express (a direct statement) or implied (conduct making performance impossible, such as selling the subject matter to a third party).

The doctrine is traditionally traced to the English case Hochster v. De La Tour (1853), in which a courier hired in April for a June tour was told in May his services would no longer be needed; the court held he could sue immediately rather than wait until June. The rule spread through common-law jurisdictions and was later codified in commercial statutes.

In the United States, the Uniform Commercial Code §2-610 governs anticipatory repudiation in sale-of-goods contracts, allowing the aggrieved party to (a) await performance for a commercially reasonable time, (b) resort to any remedy for breach, or (c) suspend its own performance. UCC §2-609 complements this by allowing a party with reasonable grounds for insecurity to demand adequate assurance of performance; failure to provide assurance within a reasonable time (not exceeding 30 days) constitutes repudiation. The Restatement (Second) of Contracts §§250–253 sets out the general common-law rule.

In international commercial practice, the UN Convention on Contracts for the International Sale of Goods (CISG), Articles 71–72, allows a party to suspend performance or avoid the contract when it becomes clear the other will commit a fundamental breach.

For practitioners, key issues are: (1) whether the statement or conduct is sufficiently unequivocal to count as repudiation, (2) whether the repudiating party has retracted before the other party relied on it, and (3) calculating damages as of the date of repudiation versus the date performance was due. A mere expression of doubt or request to renegotiate is generally not enough.