5) Performance, Modification, Excuse Flashcards
UCC ROL: seller’s obligation
transfer and deliver goods
UCC ROL: buyer’s obligation
accept and pay for goods
UCC ROL: if seller bears ROL and something happens to goods…
seller must provide replacement goods
UCC ROL: if buyer bears ROL and something happens to goods…
buyer must pay k price regardless
UCC ROL: carrier case (def)
parties agree to use common carrier
UCC ROL: non-carrier case: when does ROL transfer to buyer?
1) if seller is NOT a merchant –> as soon as goods made available (tendered) to buyer
2) if seller IS a merchant –> when goods are physically in buyer’s possession
UCC ROL: carrier case: when does ROL transfer to buyer?
1) if shipment contract –> when goods delivered to carrier
2) if destination k –> when goods are tendered at the destination
UCC ROL: carrier case: shipment k: result
buyer bears ROL if goods damaged in transit
“FOB seller”
UCC ROL: carrier case: Destination k: result
seller bears ROL if goods damaged in transit
“FOB buyer”
FOB seller
shipment k (and so, buyer bears ROL in transit)
FOB buyer
destination k (and so, seller bears ROL in transit)
modification: CL rule
modification generally not ok, bc preexisting duty rule: promise to increase compensation for duties already owed is unenforceable bc no consideration for the modification
Modification (CL): preexisting duty rule
promise to increase compensation for duties already owed is unenforceable bc no consideration for the modification
modification (CL): exceptions
modification IS enforceable if:
1) mutual modification
2) unforeseen circs
modification (CL): excceptions: mutual modification: def
w changes on both sides (then you do have consideration)
modification (CL): exceptions: unforeseen circs: def
increased compensation is given bc performance is substantially more burdensome than reasonably anticipated (relaxation of CL rule)
modification (UCC):
agreement to modify existing k DNN consideration to be enforceable IF made in good faith
UCC vs. CL: modification
CL: usually no modification w/o consideration
UCC: dnn consideration for modification
result of faulty assumptions (mistake, impossibility, impracticability, frustration of purpose)
may excuse performance
mistake (def)
faulty assumption about present (at time of k-ing) material fact
unilateral mistake (rule)
1 party’s mistake re present material fact is NOT excuse (exception)
unilateral mistake: exception
if the other party knew or had reason to know of first party’s mistake, then first party’s performance excused
mutual mistake (rule)
k voidable (ie performance excused?) by disadvantaged part y if:
1) mistake assumption is re material facts
2) both parties made mistake
3) disadvantaged party did not bear the risk of mistake
mistake: example of not material term
value!
mistake: ways one party could bear the risk of the mistake
1) expressly delegated by k
2) circs: knew about the possible issue, etc.
mistake, impossibility, impracticability, frustration of purpose: UCC or CL?
both!
faulty assumptions re future facts: 3 kinds
1) impossibility
2) impracticability
3) frustration of purpose
impossibility (rule)
both parties excused if performance made impossible by events after k formed and:
1) impossibility = objective
2) contingency that created impossibility was unanticipated (not known to parties at time of making k)
impossibility: result
both parties excused from performance
impossibility: objective vs subjective: result
objective is one of the requirements. so if subjective, NO impossibility
impossibility: objective (def)
performance literally impossible for anyone, due to circs beyond control of the parties
impossibility: subjective (def)
performance becomes impossible bc of failure or fault of performing party (like not having $)
impossibility: objective: examples
1) specific subject matter of the k is destroyed
2) personal services k and person performing services died
3) supervening law has made performance illegal
impracticability: elements
Promisor MAY BE excused from performance if:
1) contingency causing impracticability was unforeseen AND
2) increased cost/burden of performance is FAR BEYOND what either party anticipated
impracticability: result
promisor MAY be excused from performance. note: extension of CL rule, courts still reluctant excuse nonperformance
impracticability: UCC exception
same rule EXCEPT: increased costs or even rise/collapse of market are viewed as business risks that k should’ve accounted for
impracticability: UCC exception: exs of things UCC still would consider impracticable
1) war/embargo
2) crop failure in whole area
3) natural disaster