Q: What happens when one person breaches a contract, then later, the other person breaches the contract, who gets damages?
Owner of real estate gives an option to buy. Owner files bankruptcy and rejects the contract. Later, owner gives tenants the right to buy, but they don't follow through. Later, tenants breach contract by failing to pay the rent. Can the tenants get damages for the owners initial breach of contract?
A: The option to buy contract was discharged in the bankruptcy. That does not constitute a breach. Any obligation the owner had was terminated. Once discharged in bankruptcy, the debtor cannot be sued on that same contract. However, the tenants can be evicted for non-payment of rent.
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