Conditions Flashcards
What is a condition?
an event, not certain to occur, which must occur before performance becomes due
An example of an event that is not uncertain and therefore cannot be a condition is:
time
What are the two types of conditions?
express and constructive
What is an express condition?
a condition agreed upon by the parties of a contract
What is a constructive condition?
a condition supplied by the court based on what is reasonable
If the condition occurs, then
performance is due
If a condition does not occur and it is excused, then performance
is due
What are three ways to excuse the non-occurrence of a condition?
- party action, such as acceptance
- impracticability
- Disproportionate forfeiture
If a condition does not occur and it is not excused, performance _____ due
does not become
conditions that must occur before a party will be obligated to perform
conditions precedent
conditions that must occur together before either party will be obligated to perform
conditions concurrent
conditions that will cut off a party’s pre-existing duty to perform
conditions subsequent
Common excuses for non-occurrence of a condition are:
waiver, election, and disproportionate forfeiture
An _____ for the non-occurrence of a condition allows performance to become due even though the condition has not occurred
excuse
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
divisible
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.
divisible
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
adversely affected
A mistake may be _____ or _____
mutual or unilateral
A mistake is ______ if both parties enter into the contract based on the same mistake
mutual
The mutual mistake must relate to a ____ ____ that has a ________ _______ on the breaching party, who must not _______ of the mistake
basic assumption
material effect
bear the risk
The mistake must relate to a ______ ___ upon which the contract was made
basic assumption
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)
material effect
A mistake will not excuse a party’s performance if that party ____ of the mistake
bears the risk
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
bear the risk of the mistake
A mistake is _____ if only one person enters into the contract based on the mistake
unilateral
