Final answer:
In the event of a contract breach, the non-breaching party may rescind the contract or seek legal remedies such as damages, specific performance, or restitution.
Contract enforcement is essential to maintain trust in economic transactions and support economic growth.
Step-by-step explanation:
When there is a breach of contract, the non-breaching party can rescind the contract, forfeit the contract, or seek other remedies such as suing for damages, requesting specific performance, or seeking restitution. The legal system plays a crucial role in enforcing contractual rights which are grounded in property rights.
For instance, if a skilled surgeon performs an operation and the patient fails to pay, the non-payment is seen as a theft of the surgeon's services. Strong property and contractual rights ensure that the surgeon has the means to litigate and claim payment, highlighting the importance of a robust system for enforcing contracts.
Without such a system, individuals would be hesitant to enter into contracts, particularly for services to be performed in the future, increasing the risk of non-payment and impeding economic growth. Contracts and the legal enforcement of them are therefore of paramount importance to the health of the economy.