In Nicolaou v. Sobhani the parties had a contract for the purchase and sale of a lot. Before the completion date the purchaser alleged misrepresentation on the lot size and instructed their lawyer to ask for the return of the deposit. Was this an anticipatory breach that entitled the seller to keep the deposit? What risk reduction should parties consider in this situation?

The Court confirmed that anticipatory breach occurs when one party whether by express language or conduct repudiates the contract and shows an intent not to complete. The Court held that the purchasers conduct and in particular the lawyer's letter was an anticipatory breach. Risk reduction: when in a contractual relationship, obligations exist so it is important to consider possible consequences if a disagreement arises later and carefully consider these before stating your position.