breach Flashcards
Kingston v Preston - in consideration for P serving D, d promised that at the end of the year he would give his business to P, and in return P promised that he would accept the business of D’s nephews and execute a deed of partnership with them; P claimed he held up his end of the deal but D refused to give him the business; D said that P did not offer sufficient security that P promised; issue of whether the delivery of stock and business (via the sufficient security) by P a condition precedent to D giving the business to P?
Rule- you need to look at the purpose of a k and covenant to see if the covenants are independent or dependent of each other
Rule- when one party’s performance under a contract is dependent on the prior performance of the other party, the other party’s performance is a condition precedent and the performance will be excused unless the condition is satisfied
what are the three types of promises/covenants and explain how it works into breach/damages
Mutual and independent- either party may recover damages from the other for the injury he may have received by a breach of the covenant in his favor and where it is no excuse for the D to allege a breach of the covenant
Covenants where the conditions are dependent (ie applicable in kingston case ) = the performance of one DEPENDS ON THE PRIOR PERFORMANCE OF THE OTHER and therefore, till this prior condition is performed the other party is not liable to action on his covenant
Mutual conditions to be performed at the same time = if one party was ready and offered to perform his part, and the other neglected or refused, he who was ready had fulfilled his engagement and maintain an action for the default of the other
Jacobs and youngs v kent - P built a house for D, and D had been living in the house for a while when he discovered that the pipe he asked to be used had not been used and told p to do it over, P did not because it would cost too much, and D then refused to pay and P filed; issue whether the use of the specific type of pipe was a condition precedent to payment and wether the use of the wrong pipe was a breach of that condition
Rule: you need to look at the prose of the condition to see if it is a condition precedent/ dependant or independent covenant
Rule- an omission both trivial and innocent will sometimes be atoned for by allowance of the resulting damage and will not always be breach of a condition
Albert Hochester v Edgar de la Tour- (anticipatory breach/repudiation) P was hired by D to accompany him in June, but in may d wrote to p saying he had changed his mind and d refused to compensate him; issue of if a party was ready and willing to perform a K, and the other revoked it before it was meant to begin, does the party that was ready to perform have to wait until the date the K was supposed to start to bring suit?
Rule: a party who receives CLEAR NOTICE of repudiation of a K before performance is due can bring suit immediately if they choose to do so
Lane enterprises v LB foster - P contracted with a company to sell brigge components, and this agreement needed the parts to be coated, p didn’t specialize in coating so they contracted with D to do it for them; the k between p and d was an oral contract that specifies that all cleaning and coating would comply with the og contract, long story short, D’s coating job was bad and didn’t comply and in order to fulfill the original contract with the company, P asks if they are going to try again, and D says they wont until P pays them for the first job; the P had to hire someone else to coat them and it was a lot more expensive; issue of whether P’s failure to pau was a material breach and whether a party performs anticipatory breach by failing to give assurance like D did
rule : there was no MB on P’s end because they withheld paying 5 percent and they said they would pay if d gave assurance ie no material breach because it was justified
a party commits anticipatory breach of a k by failing to provide requested adequate assurance of performance
what is repudiation/anticapatory breach
when a party renounces its contractual duty before the time fixed for performance
three parts of anticipatory breach/repudaton
must be a threat of MATERIAL BREACH
must be definite and unequivocable
the action taken would make performace impossible
5 factors to consider to see if material breach
The extent to which the injured party will be deprived of the benefit which he reasonably expected
The extent to which the injured party can be adequately compensated for that part of the benefit of which he will be deprived
The extent to which the party failing to perform or to offer to perform will suffer forfeiture
The likelihood that the party failing to perform or offer to perform will cure his failure, taking account of all the circumstances including any reasonable assurances
The extent to which the behavior of the party failing to perform or offer to perform comports with standards of good faith and fair dealing
when we go through the material breach flowchart, and its found that there was not a MB, do we stop there?
no, we ask if the K was substantially peformed; if it wasnt, then the non breaching party is not obligated to go through with their end and the K is cancelled, if the K was substantially performed, then the K is still effective
what is substantial performance
when a person has perfomred the K almost fully, save a couple of minor insigngicant details being overlooked; as long as the main meat of the k was fufullied, it will be cosiderd to be substanitally performed.
Groves v John wunder - the gravel case; issue of when a party has substantially but not fully performed its obligations under a construction contract, and the breach is willful, are damages for breach calculated as the cost of completing the performance? what did the dissent think
Damages for willful breach of a construction contract, even where there has been substantial performance are awarded as the cost of completing the failed performance.
dissent thinkgs the award was too much and was more pumitive than a remedy
peevyhouse v garland coal mining co -Whether, in an action for breach of an agreement to perform remedial work on property, damages should be measured by the diminution in value of the premises resulting in non-performance if the economic benefit which would result to the property owner from full performance is grossly disproportionate to the cost of performance.
Regardless of any agreement of the parties, damages awarded for breach of an agreement to perform remedial work on property should normally be measured by the reasonable cost of performance of the work; but, when the contract provision breached is merely incidental to the main purpose in view and where the economic benefit which would result to the owner from full performance is grossly disproportionate to the cost of performance, damages should instead be limited to the diminution in value resulting to the premises because of the non-performance.
what do courts usually use to award damges (cost of completion or dimuniton of value)
cost of completion
what is dimuntion in value calcuation for damges
its the minority rule; The damages are calculated by subtracting the market value of the object of the contract as performed from the value of the contract as promised.
what is cost of completion in terms of calculating damages
what we ususally use;he expense of finishing a project, promise, or contract. Normally, cost of completion appears in contract law as a type of damages awarded to a party in a contract that another party intentionally breached.
