Breach of Contract – Material Breach

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WI Court of Appeals – District III

Case Name: Thomas A. King v. Randall L. Niederkorn

Case No.: 2021AP281

Officials: Stark, P.J., Hruz and Gill, JJ.

Focus: Breach of Contract – Material Breach

As owners of land, Randall, Reed, Roger, Robert and Richard Niederkorn entered into a logging contract with Thomas and Kirsten King to cut and sell timber from portions of the Niederkorns’ property. Several months after the Kings began performing their contractual obligations, the Niederkorns terminated the contract. The Kings alleged, among other things, that the Niederkorns’ termination of the contract was a breach of the contract and caused the Kings to suffer lost profits.

The circuit court concluded that the contract required a material breach before the Niederkorns could terminate it. Because the court found that none of the Kings’ seven breaches of the contract were material, it determined that the Niederkorns had improperly terminated the contract. After offsetting the Niederkorns’ damages, the court entered a judgment awarding monetary damages to the Kings. On appeal, the Niederkorns challenge both the court’s conclusion regarding the legal standard for terminating the contract and its findings regarding whether the Kings’ breaches of contract were material.

The court concludes that the contract required a material breach before the Niederkorns could terminate it. Although Wisconsin law permits parties to specify the circumstances in which a contract can be terminated, the parties’ contract here did not expressly permit termination upon something less than a material breach. The court also concludes the circuit court did not apply an improper legal standard in determining whether the Kings’ breaches of contract were material.

Affirmed

Decided 10/11/22

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