Breach of contract Flashcards
how can you breach a contract?
if there is non-performance
possible causes of non-performance
no performance at all
delayed performance
defective performance
partial performance
how can liabilities can be divided between parties
extended, limited, excluded
main remedies of the obligee/ creditor
- damages
- equitable remedies- termination, specific performance
damages
- is there a breach of contract?
- is there damage
- attributability
- notice
- causation/ foreseeability
- contributory negligence/ the duty to mitigate
what are damages
a remedy for the breach of the contract. the purpose is to compensate the injured party for loss or damage arising from the breach.
main rule: monetary compensation. the causation determines the amount
attributability in civil law
breach must be attributable to the promisor
attributability in English law
strict liability= no requirement of attributability
mistakes arising from the third person used by the obligor
the obligor is liable for mistakes made by persons used by him or her to execute the agreement
mistakes arising from the use of goods
by the obligor are also for his account
attributability in German law
The obligee may demand damages for the damage caused thereby. This does not apply if the obligor is not responsible for the breach of duty
attributability in French law
The debtor is ordered to pay damages unless he shows that his performance was prevented by force majeure.
Force majeure (civil law) 2 possibilites
performance still possible- the obligee can still demand performance, so the obligation can be postponed
performance impossible- the obligee can terminate immediately the agreement
force majeure French Law
renegotiate the contract or terminate or ask the court by common agreement to adapt it
force majeure German Law
adaptation of the contract or revocation
Frustration (English law)
automatically results in the discharge of all parties from their obligations.
1. Destruction or unavailability of the subject matter
2. Death or illness of one of the parties
3. Supervening illegality
4. Government intervention
5. The event on which the contract is based fails to occur
6. Delay in performance (caused by supervening event!)
notice
civil law- a notice is required; no notice if the promisor refuses to perform
English law- no notice
causation/ foreseeability
a promisor is bound only to damages which were foreseen or could have been foreseeable at the time of conclusion of the contract
EXCEPT where non-performance was due to a gross and dishonest fault
contributory negligence/ duty to mitigate
the injured party has to mitigate any losses
contributory negligence may reduce the amount of damages
termination
if the promisor does not perform, the promisee can terminate the contract.
damage can be claimed
termination and agreed remedies
- agreed damages:
- liquidated clauses= calculated then, all countries
- penalty clauses= already stated in the contract, only civil law (in extreme cases the court may reduce the amount) - termination clauses= states when it is allowed and what consequences there will be if you terminate the contract
specific performance- civil law
- you claim specific performance
- damages
not granted when:
- it is impossible
- disproportion between expense and effort needed to perform on the one hand, and the interest that the promisee has in the performance on the other
- personal services
specific performance- common law
- damages
- specific performance
claim when:
- it is at the court’s discretion
- damages are inadequate:
- unique item
- cannot buy substitute performance on the market
- makes a more just result
