Conditions

Question 1

What is a condition?

Answer 1

an event, not certain to occur, which must occur before performance becomes due

Question 2

An example of an event that is not uncertain and therefore cannot be a condition is:

Answer 2

time

Question 3

What are the two types of conditions?

Answer 3

express and constructive

Question 4

What is an express condition?

Answer 4

a condition agreed upon by the parties of a contract

Question 5

What is a constructive condition?

Answer 5

a condition supplied by the court based on what is reasonable

Question 6

If the condition occurs, then

Answer 6

performance is due

Question 7

If a condition does not occur and it is excused, then performance

Answer 7

is due

Question 8

What are three ways to excuse the non-occurrence of a condition?

Answer 8

1. party action, such as acceptance
2. impracticability
3. Disproportionate forfeiture

Question 9

If a condition does not occur and it is not excused, performance _____ due

Answer 9

does not become

Question 10

conditions that must occur before a party will be obligated to perform

Answer 10

conditions precedent

Question 11

conditions that must occur together before either party will be obligated to perform

Answer 11

conditions concurrent

Question 12

conditions that will cut off a party’s pre-existing duty to perform

Answer 12

conditions subsequent

Question 13

Common excuses for non-occurrence of a condition are:

Answer 13

waiver, election, and disproportionate forfeiture

Question 14

An _____ for the non-occurrence of a condition allows performance to become due even though the condition has not occurred

Answer 14

excuse

Question 15

A contract is _____ if: (1) both parties’ performance is divided into at least two parts, (2) both parties owe the same number of performances, and (3) each party’s performance of one part, or unit is the agreed-upon exchange for the other party’s equivalent performance

Answer 15

divisible

Question 16

If a contract is _____ then a party’s performance of the entire contract will not be a condition precedent to the other party’s obligation to perform. Rather, the party’s performance of each unit will trigger the other party’s duty to perform the corresponding part.

Answer 16

divisible

Question 17

A breaching party who is ____________ by a mistake may avoid performance if at least one of the parties held an erroneous belief that was not in accordance with the facts or the law at the time of the contract

Answer 17

adversely affected

Question 18

A mistake may be _____ or _____

Answer 18

mutual or unilateral

Question 19

A mistake is ______ if both parties enter into the contract based on the same mistake

Answer 19

mutual

Question 20

The mutual mistake must relate to a ____ ____ that has a ________ _______ on the breaching party, who must not _______ of the mistake

Answer 20

basic assumption
material effect
bear the risk

Question 21

The mistake must relate to a ______ ___ upon which the contract was made

Answer 21

basic assumption

Question 22

The mistake must have a _____ on the exchange of performances (the resulting imbalance must be so severe that the breaching party cannot be fairly required to perform)

Answer 22

material effect

Question 23

A mistake will not excuse a party’s performance if that party ____ of the mistake

Answer 23

bears the risk

Question 24

A party may _________ based on: (1) the terms of the contract expressly allocating the risk to that party, (2) court allocation of the risk to one party that is reasonable under the circumstances, or (3) the party’s conscious ignorance of the relevant facts, despite awareness of his or her own limited knowledge

Answer 24

bear the risk of the mistake

Question 25

A mistake is _____ if only one person enters into the contract based on the mistake

Answer 25

unilateral