What duty does the non-breaching party have under contract law?

In contract law, if a party is faced with a breach of contract, the non-breaching party has the duty to mitigate damages. This means they must take reasonable steps to minimize their losses resulting from the breach. The rationale behind this duty is to prevent the non-breaching party from incurring unnecessary losses and to encourage parties to resolve their disputes efficiently.

For example, if the non-breaching party was expecting the delivery of goods that were not delivered, they may need to find a replacement supplier promptly instead of waiting and allowing losses to mount. By taking such steps, they demonstrate responsibility for their own interests and prevent the situation from worsening.

The other options do not align with the expectations set by contract law on the non-breaching party's responsibilities. Ignoring the breach would only exacerbate the situation, and seeking punitive damages is generally not allowed in cases of breach of contract, as this type of damage is usually reserved for tort claims. Terminating the contract immediately might not be the most prudent step, as it could lead to further complications or claims for damages if the non-breaching party has not first attempted to mitigate their losses.