23-Discharge of a Contract Flashcards
What case is an early example that discharge by performance must be complete and exact?
Cutter v Powell (1795)
Facts: Cutter agreed to work on a ship for its full voyage but died half way. Wife not entitled to his fee.
Cutter v Powell (1795)
What principle does this case demonstrate
Principle: that discharge by performance must be complete and exact.
Facts: Cutter agreed to work on a ship for its full voyage but died half way. Wife not entitled to his fee.
What case modern example of discharge by performance must be complete and exact?
Re Moore and Co and Landauer and Co.’s Arbitration (1921)
Facts: Supplier of tinned foods provided their tins in packs of a different number than that stated in the contract.
Re Moore and Co and Landauer and Co.’s Arbitration (1921)
What principle does this case support?
Principle: discharge for performance must be complete and exact.
Facts: Supplier of tinned foods provided their tins in packs of a different number than that stated in the contract.
The harshness of the rule of discharge by performance is tempered by what factors?
1) Divisible contracts-Ritchie v Atkinson (1808)
2) Substantial performance-Dakin and Co. v Lee (1916
3) Prevention of full performance-Planche v Colburn (1831)
4) Acceptance of part-performance-Sumpter v Hedges (1898)
The first factor tempering the harshness of the rule on discharge by performance?
Divisible contracts
Ritchie v Atkinson (1808)
Facts: Ship owner agreed to carry cargo but only actually carried part of it-ship owner entitled to that amount but was charged for breach of contract.
Ritchie v Atkinson (1808)
What factor does this case demonstrate regarding the harshness of the rule on discharge by performance?
Divisible contracts
Facts: Ship owner agreed to carry cargo but only actually carried part of it-ship owner entitled to that amount but was charged for breach of contract.
The second factor tempering the harshness of the rule on discharge by performance?
Substantial performance
Dakin and Co. v Lee (1916)
Facts: Builder completed works but certain things were completed inadequately that had to be paid for. Court decided work was still completed.
Dakin and Co. v Lee (1916)
What factor does this case demonstrate regarding the harshness of the rule on discharge by performance?
Substantial performance
Facts: Builder completed works but certain things were completed inadequately that had to be paid for. Court decided work was still completed.
What case demonstrates the tempering nature of ‘divisible contracts’ on the rule of discharge by performance?
Ritchie v Atkinson (1808)
Facts: Ship owner agreed to carry cargo but only actually carried part of it-ship owner entitled to that amount but was charged for breach of contract.
What case demonstrates the tempering nature of ‘substantial performance’ on the rule of discharge by performance?
Dakin and Co. v Lee (1916)
Facts: Builder completed works but certain things were completed inadequately that had to be paid for. Court decided work was still completed.
The third factor tempering the harshness of the rule on discharge by performance?
Prevention of full performance
Planche v Colburn (1831)
Facts: C-an author was paid quantum meruit for writing a book as part of a series that was cancelled by publisher.
Planche v Colburn (1831)
What factor does this case demonstrate regarding the rule of discharge by performance?
Factor: Prevention of full performance
Facts: C-an author was paid quantum meruit for writing a book as part of a series that was cancelled by publisher.
What case demonstrates that regarding discharge of contract by performance-prevention of full performance can temper the harshness of this rule?
Planche v Colburn (1831)
Facts: C-an author was paid quantum meruit for writing a book as part of a series that was cancelled by publisher.
The fourth factor tempering the harshness of the rule on discharge by performance?
Acceptance of part-performance
Sumpter v Hedges (1898)
Facts: Builder only built 1 of 2 agreed houses and customer HAD to finish build himself-therefore no claim of acceptance by part-performance was allowed.
Sumpter v Hedges (1898)
What does this case demonstrate regarding the rule of discharge of contract by performance?
Demonstrates: acceptance of part-performance
Facts: Builder only built 1 of 2 agreed houses and customer HAD to finish build himself-therefore no claim of acceptance by part-performance was allowed.
What case demonstrates that acceptance of part-performance can temper the harshness in the rule of discharge by performance?
Sumpter v Hedges (1898)
Facts: Builder only built 1 of 2 agreed houses and customer HAD to finish build himself-therefore no claim of acceptance by part-performance was allowed.
What circumstances will make time a condition of a contract?
1) The parties have expressly stated a time in contract.
2) Circumstances suggest time is critical
3) After a party has failed to perform a new time has been specifically agreed.
If none of above are present then time is a warranty to contract.
What cases show that if time is not a condition in a contract, it is considered a warranty instead?
Charles Rickards Ltd. v Oppenheim (1950)-Rolls Royce chassis.
Union Eagle Ltd. v Golden Achievement Ltd. (1997)-Flat sale at 5 p.m.
Charles Rickards Ltd. v Oppenheim (1950)
What principle does this case support?
That if time is not mentioned in a contract then it is considered a warranty as a pose to a condition.
Facts: Rolls Royce chassis was to have a body built on it by a specified date but this date was not met-buyer was entitled to reject the product.
Union Eagle Ltd. v Golden Achievement Ltd. (1997)
What principle does this case support?
That if time is not mentioned in a contract then it is considered a warranty as a pose to a condition.
Facts: Vendor of a flat specified a completion time of 5 p.m. and this was not met-vendor was entitled to reject the offer given 10 minutes late.
What act and section provides that contracts with consumers should be completed within a reasonable time where it is not specifically stated?
CRA 2015 s52
CRA 2015 s52
Provides that where a time hasn’t been specified in a contract with a consumer then it must be completed within a reasonable time.
What act and section provides that in consumer contracts, if the trader fails to perform within a reasonable time then consumer is entitled to a price reduction?
CRA 2015 s54
CRA 2015 s54
Provides that if a trader breaches s52 CRA 2015 then consumer is entitle to a price reduction.
What type of term can lead to repudiation of a contract?
A condition (not a warranty)
Can breach of a warranty lead to repudiation?
No (only damages)
What are the circumstances that give rise to a breach of contract?
1) renunciation-by a party of their liability under it-like not paying a bill on due date.
2) Impossibility by own act.
3) Total or partial failure of performance.
What case is an example of an anticipatory breach?
Hochster v de la Tour (1853)
Facts: Hochster agreed to work as a courier on a tour that was due to start in June. He was notified in May that the tour was cancelled.
Hochster v de la Tour (1853)
What is this case an example of regarding breached contracts?
Principle: anticipatory breach
Facts: Hochster agreed to work as a courier on a tour that was due to start in June. He was notified in May that the tour was cancelled.
Anticipatory breach definition
When a party to a contract gives notice that it will not be performing or completing the contract.
When a party to a contract gives notice that it will not be performing or completing the contract.
Anticipatory breach
What case sets out when a breach can be treated as an anticipatory breach?
Bulk Uruguay (2014)
What case is an early example of discharge by frustration?
Taylor v Caldwell (1863)
Facts: Hirer of a music hall had paid for advertisements but the hall burned down before the show-contract was frustrated.
Taylor v Caldwell (1863)
What is this case an example of?
An early example of discharge by frustration.
Facts: Hirer of a music hall had paid for advertisements but the hall burned down before the show-contract was frustrated.
What case demonstrates impossibility of performance?
Jackson v Union Marine Ltd. (1874)
Facts: Ship that ran aground could not fulfil contract to bear goods.
Jackson v Union Marine Ltd. (1874)
What is this case an example of?
Frustration-by impossibility of performance.
Facts: Ship that ran aground could not fulfil contract to bear goods.
What case demonstrates frustration of contract by impossibility of performance due to medical grounds?
Condor v The Baron Knights (1966)
Facts: Contracted drummer was told to only perform 4 times a week.
Condor v The Baron Knights (1966)
What is this case an example of?
Frustration-by impossibility of performance-medical grounds
Facts: Contracted drummer was told to only perform 4 times a week
What case is an example of frustration by contract becoming illegal to perform?
DMD Ltd. v James Fraser Ltd. (1944)
Facts: Importing goods that the contract was concerned with became illegal after war.
DMD Ltd. v James Fraser Ltd. (1944)
What is this case an example?
Frustration of contract by becoming illegal to perform.
Facts: Importing goods that the contract was concerned with became illegal after war.
What case is an example of frustration of contract by radical change of circumstance?
Krell v Henry (1903)
Facts: Cancelled coronation means no procession passes by hired hotel room-therefore frustrating the contract.
Krell v Henry (1903)
What is this case an example of?
Frustration due to a radical change of circumstance.
Facts: Cancelled coronation means no procession passes by hired hotel room-therefore frustrating the contract.
What case is similar in fact but contrasts with the findings in Krell v Henry (1903)
Herne Bay Steamboat v Hutton (1903)
Facts: King’s absence did not frustrate commercial purpose of contract because the boat was hired to view the assembled flotilla.
Krell v Henry (1903)
What case is similar in fact but contrasts with the findings in this case?
Herne Bay Steamboat v Hutton (1903)
Facts: King’s absence did not frustrate commercial purpose of contract because the boat was hired to view the assembled flotilla.
Herne Bay Steamboat v Hutton (1903)
What case is similar in fact but contrasts with the finding in this case?
Krell v Henry (1903)
Facts: Cancelled coronation means no procession passes by hired hotel room-therefore frustrating the contract.
In what circumstances does frustration not apply?
1) Self induced frustration-Maritime National Fish v Ocean Trawlers (1935)
2) Contract becoming less profitable-Davis Contractors v Fareham Council (1956)
3) Frustrating event is foreseeable risk/ mentioned in contract-Amalgamated Investment v John Walker Ltd. (1977)
What case demonstrates that self induced frustration does not mean a contract is frustrated?
Maritime National Fish v Ocean Trawlers (1935)
Facts: Shipping company wrongly applied licences to its own boats rather than the one it had just hired-within their control so frustration cannot apply.
Maritime National Fish v Ocean Trawlers (1935)
What does this case demonstrate?
That self-induced frustration does not constitute frustration of contract.
Facts: Shipping company wrongly applied licences to its own boats rather than the one it had just hired-within their control so frustration cannot apply.
What case is similar to Maritime National Fish v Ocean Trawlers (1935) in facts but contrasts in findings?
Gamerco SA v Missouri Storm (1995)
Facts: Guns N’ Roses concert was cancelled as the venue lost it’s licence which was out of the hands of both parties.
Gamerco SA v Missouri Storm (1995)
What case does this contrast with in finding but is similar in facts?
Maritime National Fish v Ocean Trawlers (1935)
Facts: Guns N’ Roses concert was cancelled as the venue lost it’s licence which was out of the hands of both parties.
What case demonstrates that specific wording may have helped lead to a frustrated contract?
The Super Servant 2 (1990)
Facts: D agreed to transport oil rig using either Super Servant 1 or 2 but did not specify-when Super Servant 2 ran aground there could be no frustration as Super Servant 1 could have been used.
The Super Servant 2 (1990)
What does this case demonstrate?
That in the absence of specific wording a contract may not be frustrated.
Facts: D agreed to transport oil rig using either Super Servant 1 or 2 but did not specify-when Super Servant 2 ran aground there could be no frustration as Super Servant 1 could have been used.
What case demonstrates that just because a contract becomes less-profitable does not mean it is frustrated?
Davis Contractors v Fareham Council (1956)
Facts: Labour shortages increased building costs for houses built for council-but this did not frustrate the contract.
Davis Contractors v Fareham Council (1956)
What does this case demonstrate?
That a contract becoming less profitable does not mean it is frustrated.
Facts: Labour shortages increased building costs for houses built for council-but this did not frustrate the contract.
What case demonstrates that a foreseeable event or an event being mentioned in a contract means that frustration of contract may not apply?
Amalgamated Investment v John Walker Ltd. (1977)
Facts: After being purchased a building’s value decreased because it was listed-this is a foreseeable risk for old buildings.
Amalgamated Investment v John Walker Ltd. (1977)
What does this case demonstrate?
A foreseeable event or one that is mentioned in contract means contract is not frustrated.
Facts: After being purchased a building’s value decreased because it was listed-this is a foreseeable risk for old buildings.
What case demonstrates that the courts are, in general, reluctant to find there has been frustration of contract?
And why?
Armchair Answercall v People in Mind (2016)
Facts: Franchisees refused to sign up to new organisation structure-not considered frustration because there was
- time lapse of 5 months
- no one single frustrating event.
Armchair Answercall v People in Mind (2016)
What does this case demonstrate?
Courts are generally reluctant to find that contract has been frustrated.
Facts: Franchisees refused to sign up to new organisation structure-not considered frustration because there was
- time lapse of 5 months
- no one single frustrating event.
What are five conditions for frustration?
To whom are they attributed?
What case were the comments derived from?
Bingham LJ in The Super Servant 2
1) Mitigate-law’s insistence on literal performance.
2) Not to be invoked lightly-as frustration effectively ends contract.
3) Frustration caused contract to end.
4) External event
5) Without blame-or fault of party seeking to rely on it.
What statute seeks to resolve situations where frustration has arisen?
Law Reform (Frustrated Contracts) Act 1943
What are the key sections of the Law Reform (Frustrated Contracts) Act 1943?
s1(2)-Money paid before frustrating event is liable to refund.
- Money that was due before frustrating event no longer owed.
- If party that was owed money incurs expenses then this is recoverable-limited to amount described above.
s1(3)-Prevention of the unjust enrichment of one party.
(If one party benefits before frustrating event this is the recoverable)
s1(4)-additional costs may be recoverable such as work or services performed personally between parties.
s1(2) Law Reform (Frustrated Contracts) Act 1943
s1(2)-Money paid before frustrating event is liable to refund.
- Money that was due before frustrating event no longer owed.
- If party that was owed money incurs expenses then this is recoverable-limited to amount described above.
s1(3) Law Reform (Frustrated Contracts) Act 1943
s1(3)-Prevention of the unjust enrichment of one party.
(If one party benefits before frustrating event this is the recoverable)
BP Exploration v Hunt (No. 2) (1979)
s1(4) Law Reform (Frustrated Contracts) Act 1943
s1(4)-additional costs may be recoverable such as work or services performed personally between parties.
What case demonstrates the harshness of the rule on frustrated contracts historically?
Parodine v Jane (1647)
Facts: Army invading a tenants land didn’t mean he didn’t have to pay rent!
Paradise v Jane (1647)
Example of: harshness of rule on discharge by frustration historically.
Facts: Army invading a tenants land didn’t mean he didn’t have to pay rent!
