A breach of contract which has particularly serious consequences for the injured party; for example, where the installation of defective machinery causes a fire which destroys the buyer's premises. The expression may also be used to refer to the related concept of breach of fundamental term ("fundamental breach" and "breach of fundamental term" are sometimes used interchangeably): a fundamental term is a core term so that, if it is not complied with, performance becomes totally different from what was contemplated by the contract. An example would be where the seller of a car delivers a car which is in such poor condition that it is completely undriveable.
Related links
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.