What does it mean if a contract is substantially performed?

Substantial performance refers to the situation where a party has completed enough of the contract's obligations that it effectively fulfills the essence of the agreement, despite some minor breaches. In this context, it indicates that while not everything was completed exactly as specified, the party has made a significant effort and has likely provided the essential benefits that the contract was intended to deliver.

In practice, substantial performance protects the performing party from a claim of breach when the non-completion is not fundamental to the essence of the contract. Minor discrepancies or defects that do not affect the overall purpose of the contract would not allow the other party to treat the contract as void or to terminate it. Instead, the other party might still be obliged to fulfill their end of the contract, possibly seeking remedies such as damages for the minor breaches without negating the contract entirely. This principle encourages fairness in contractual relationships by acknowledging the effort made, even if it isn’t perfect.

The other options do not accurately reflect the concept of substantial performance. For instance, if a contract is voided, it means that it is treated as if it never existed, which is contrary to the idea of substantial performance. A statement that obligations have been fully met would imply complete adherence to the contract terms, which does