A breach of contract sounds bad, and it very much is. In most people's worst nightmares, it's a breach of contract that leads to their business ideas ending up in competitor's hands. The reality is that breaching a contract does have far-reaching consequences and does need to be taken seriously.
A breach of contract occurs when one party doesn't fulfill its obligations to another. The two, or more, parties have a contract. By failing to meet their obligations, one or more party breaches the contract.