Breach Flashcards
Breach occurs when:
Failure to perform absolute duty, in absence of defenses, excuses, or discharge of duty.
Does breach always excuse nonbreaching party’s performance?
No. Nonbreacher must show they are willing/able to perfrom but for breach.
Common law breach. What to look at.
Whether they materially breached or substantially perfromed.
If breaching party substantially performed, nonbreaching party still must perform then pursue remedies.
Substantial Performance
Has occurted when nonbreaching party has gained a substantial benefit of the bargain despite defective performance.
Common law minor breach
Does not excuse performance. Just gives right to remedy.
Determining materiality of breach/substantial performance
Court considers:
1) Impact on non breaching party
2) Actions and intentions of breaching party
3) Benefit recieved by nonbreaching party
4) Hardship to breaching party
5) Extent of performance
6) Likelihood that breaching party can and will cure the breach
Time for performance
Failure to perform within stated time is not a material breach UNLESS Time is of the essence.
Including dates of performance doen’t make time of the essence. Totality of circumtsnaces.
Perfect Tender Rule
If goods fail to conform, buyer may:
1) Reject entire shipment, OR
2) accept entire shipment, OR (still may be able to recover)
3) reject in part, accept in part (must be in commercial units; can’t keep parts)
Acceptance of Goods
Buyer accepts goods if they:
1) Indicate goods conform to K
2) Indicate they’ll keep nonconforming goods
3) Fail to reject within reasonable time
4) Fail to notify seller of rejection
5) Act inconsistent with seller’s ownership
Right to revoke acceptance
If accepted, may no longer reject them. But if breach is discovered later and not obvious, buyer may revoke. Must notify within reasonable time or be barred by remedy.
(Lebron Example - painting motorcycle)
UCC and Rejection
Doesn’t assume rejection.
When nonconforming goods are rejected, seller has right to cure within time of performance and with notice.
Installment Contracts
Exception to perfect tender rule
1) Buyer can reject installment if nonconformity substantially impairs value of installment
2) K breached if nonconformity substantially impairs entire Ks value
Anticipatory repudiation
1) Early statement of non-performance
2) Repudiations can be retracted if not relied on
