Conditioning Promises Flashcards
Glaholm v. Hays, UK, 1841, p.756
Conditioning Promises
Parties “mutually agreed” that vessel would load cargo and proceed” to a UK port….on or before the 4th day of February next. Ship didn’t. Ct: when a particular clause is a condition when ≠ performed party to abandon the K or amounts only to a promise, the breach of which is recompensed by damages MUST depend on intention of the parties. Intention to be determined from the language of entire agreement and the subject matter to which it relates. Performance of the stipulated date goes to root/whole of consideration of the K.
Howard v. Federal Crop Ins. Corp., 4th Cir., 1976, p.756
Conditioning Promises
FCIC issued policies to Howards insuring tobacco crops for weather damage and other hazards. 1973 crop was extensively damaged by heavy rains. Depleted crop harvested and sold; filed notice and proof of loss w/ FCIC, but plowed fields for later sowing before inspection. FCIC denied claim b/c Ps had violated a portion of the policy re: plowing over fields before inspection. Ct: when doubtful if words create a promise or a condition precedent, they will be construed as creating a promise.
Meritt Hill Vineyards, Inc. v. Windy Heights Vineyard, Inc., NY, 1984, p.760
Conditioning Promises
At closing of agreement entered in 6 months earlier, D had failed to secure two things in the agreement, so P refused to close/demanded return of deposit. Ct: purchaser gets deposit back; a condition is an event, ≠ certain occur, which must unless its nonoccurrence is excused, before performance under a K becomes due. No damages.
Moore Bros. Co. v. Brown & Root, Inc., 4th Cir., 2000, p.761
Conditioning Promises
Subcontractors sued the general contractor for payment for their work on a road construction project, despite the fact that their contract included a “pay when paid” clause and the contractor itself had not been paid; the court waived the condition precedent of payment to the contractor and held in favor of the plaintiffs, because the contractor’s own conduct had prevented the condition precedent from occurring. The prevention doctrine is a generally recognized principle of contract law according to which, if a promisor prevents or hinders fulfillment of a condition to his performance, the condition may be waived or excused. The doctrine does not require proof that the condition would have occurred but for the wrongful conduct of the promisor. Rather, it only requires that the conduct have contributed materially to the non-occurrence of the condition.
Berry v. Time Insurance Co., 2011, p.766
Conditioning Promises
Berry (P) was told she could not receive home healthcare benefits under her nursing home policy with the defendant insurer unless the provider was licensed, but South Dakota did not license home healthcare providers so she paid for the care herself in order to Street Associates Ltd. Partnership v. out the policy did not actually include the licensure requirement and she sued to recover her insurance benefits. When a duty of one party is subject to the occurrence of a condition, the additional duty of good faith and fair dealing imposed on him may require some cooperation on his part, either by refraining from the conduct that will prevent or hinder the occurrence of the condition, or by taking affirmative steps to cause its occurrence.
Conditioning Promises
Berry (P) was told she could not receive home healthcare benefits under her nursing home policy with the defendant insurer unless the provider was licensed, but South Dakota did not license home healthcare providers so she paid for the care herself in order to Street Associates Ltd. Partnership v. out the policy did not actually include the licensure requirement and she sued to recover her insurance benefits. When a duty of one party is subject to the occurrence of a condition, the additional duty of good faith and fair dealing imposed on him may require some cooperation on his part, either by refraining from the conduct that will prevent or hinder the occurrence of the condition, or by taking affirmative steps to cause its occurrence.
Ewell v. Landing, MD, 1952, p.771
Conditioning Promises
P loaned $550 in cash to D, who promised to repay sum when he had “sold his timber.” D died w/out repaying. Unclear if timber was sold. CT: judgment for P; obligation to pay money can be made contingent on the occurrence of a future event – D’s selling of the timber constituted merely a convenient time for payment. Ct: could ≠ have been intention of the parties that if the timber were ≠ sold, P would recover nothing – it would be a “mockery of justice”
Amies v. Wesnofske, NY, 1931, p.771
Conditioning Promises
Real estate brokers hired under oral agreement as agents for family farm to be paid $5000, half on signing of K of sale and half on closing. Ct: “when” “after” “as soon as” are just as effective as saying “if” to create an express condition, w/ result that when event referred to by such a phrase does ≠ occur, no duty of performance arises.
Royal-Globe Ins. Co. v. Craven, MA, 1992, p.771
Conditioning Promises
D was injured in hit and run automobile accident; remained in ICU for several days and released from hospital 23 days after accident. Gave formal notice of claim 4 months later; claim was denied re: a yr later; 3 yrs later, D filed demand for arbitration; 4 months later P filed declaratory action. Ct: policy puts time pressure on insured to notify after disability removed – she was ≠ prompt, so there is no recovery. D argued that insurer estopped from raising failure of notice to deny liability; they investigated the claim and behaved as though they would reimburse her. She was ≠ induced to behave differently.
Semmes v. Hartford Ins. Co., 1871, p.774
Conditioning Promises
π brought suit on a fire insurance policy issued by ∆. Argued that the civil war prevented them from notifying about damage w/in 12 mo. provision. War rendered compliance with the condition impossible.
Clark v. West, NY, 1908, p.781
Conditioning Promises
P and D entered into a written K under which P was to write and prepare for publication a series of law books. P was to be paid $2 per page of book unless he abstained from liquor, then he’d be paid an additional $4/page. After volume completed, parties disagreed re: whether P completely abstained from use of liquor (which did ≠ interfere w/ the due and full performance of the K. Complaint alleged a waiver on the part of D of the P’s stipulation to totally abstain from the use of liquor. Ct: Stipulation ≠ consideration for K, but an condition that could be expressly waived and was by P’s acceptance of the manuscript w/out objection and repeated reassurances as to the hr fee. D estopped from asserting condition of temperance.
Schultz v. Los Angeles Dons, Inc., CA, 1951, p,784
Conditioning Promises
K between club and player contained clause that if K was terminated by Club by reason of Player’s failure to render services based on disability resulting directly from injuries sustained in performance of services, if written report was given, club would pay full season’s salary. P injured during training season; reported immediately to head coach and trainer orally. Trainer made written report to insurance. Ct: club’s termination of K ≠ justified. Purpose of required notice to make sure club well informed, and they WERE. By using info, club waived requirement of written notice.
Grenier v. Compratt Constr. Co., CT, 1983, p.785
Conditioning Promises
K conditioned payment upon certificate of performance. Roads well completed, but P could ≠ get letter from city engineer b/c he did ≠ write such letters. Got certification from building inspector; delay -> liquidated damages clause kicked in. Ct: occurrence of condition can be excused in event of impracticability (if it ≠ material part of agreed exchange R2K § 271). Party inability to procure certificate excused duty. There was FULL performance after limiting condition was excused; no real delay (D made no factual showing of injury b/c of delay).
Loyal Erectors, Inc. v. Hamilton & Son, Inc., ME, 1973, p. 789
Conditioning Promises
Parties in K had dissimilar purposes w/ condition of architect’s certificate of approval, progress payments, etc.. Progress payment mostly for protection of Kor (save from credit issues, etc.); other party may be benefited incidentally by timely performance of work, lack of breaches. Final payment to protect owner to assure strict performance in line w/ the agreements – induces K to render a performance that conforms to plans
Second Nat’l Bank v. Pan-American Bridge Co., 6th Cir. 1910, p.789
Conditioning Promises
Kor precluded from recovery by architect’s refusal to accept performance of K and give certification. Lw Ct: if work and material conformed, recovery could be had despite lack of acceptance by architect. Hr Ct: could ≠ dispense w/ certificate – a condition for recovery in absence of fraud or mistake so gross as to imply bad faith. Actual conformity of work and materials to plans can≠ be made test of bad faith that law requires for setting aside the action of the architect.
Maurer v. School Dist. No. 1, MI, 1915, p.790
Conditioning Promises
No certificate procured from architect – they were ≠ required, but payments made on monthly K upon info statements certifying material and labor since last payment etc. Architect, refused final statement b/c question of liquidated damages arising out of delay in completed the building. K did ≠ give architect this authority. Ct: D waived condition in K relative to certificates ‘till building was completed; P was ≠ at fault b/c the certificate was ≠ furnished upon request.
