What If Both Parties Breach the Contract? Article 1192 Explained
Quick answer: Article 1192 of the Civil Code applies when both parties to a reciprocal obligation commit breaches. If it cannot be determined which party first violated the contract, each party generally bears his or her own damages and the obligation is deemed extinguished. If one party clearly breached first, that party may bear responsibility, while the later breach by the other party may affect the court’s assessment of damages.
Civil Code Articles 1191 and 1192 should be read together because Article 1191 governs remedies for breach of reciprocal obligations, while Article 1192 addresses the special problem of breach by both sides.
When Article 1192 applies
Article 1192 is most relevant when each party had reciprocal obligations and both failed to perform properly. It is not enough that both parties are unhappy with the transaction; there must be legally relevant breaches tied to their reciprocal undertakings.
Who breached first?
The sequence matters. If the evidence shows that one party first committed a substantial breach, that breach may determine primary responsibility. A later breach by the other side does not necessarily erase the first breach, although it may reduce or alter damages.
What if the first breach cannot be determined?
Article 1192 provides that when it cannot be determined which party first violated the contract, the obligation is deemed extinguished and each party bears his or her own damages.
Decision table
| Situation | Likely issue |
|---|---|
| Party A clearly breaches first | Primary responsibility may fall on Party A |
| Party B later also breaches | Later breach may affect damages |
| Both breach and sequence is unclear | Article 1192 may extinguish the obligation and each bears own damages |
| Only one breach is substantial | Article 1191 analysis may remain central |
Evidence to preserve
- Contract and amendments
- Performance schedules
- Delivery and payment records
- Emails and messages showing sequence
- Demand letters and replies
- Proof of readiness to perform
Practical steps
- Build a dated chronology of both parties’ obligations.
- Identify the first proven non-performance.
- Separate slight breaches from substantial ones.
- Check whether one breach legally excused later non-performance.
- Evaluate damages separately from the right to resolution.
Related guides
Start with Can I Cancel a Contract if the Other Party Does Not Perform?, then compare what counts as a substantial breach and specific performance, resolution, and damages.