Conditions and Promises Flashcards
What is the effect of a promise/covenant?
A right under a contract. A benefit of the obligor’s promise.
How does common law treat “best efforts”?
Common law does not apply a best efforts term to contractual obligations
Contracts are a form of . . .
strict liability
What are used to soften the spikes of strict liability nature of contracts?
conditions
What is the difference between defenses and excuses?
Defense to formation argues a contract was not formed. Excuse to performance argues that a contract was formed but a party has not fulfilled its duties.
What is a condition precedent?
A condition precedent is a fact or event which the parties intend must exist or take place before there is a right to performance.
If a condition precedent is not fulfilled, the contract . . .
is not enforceable
What is the test for a condition precedent?
Lack of ambiguity. If a condition is not ambiguous, it must be complied with.
What is an express condition precedent?
One that is agreed to and imposed by the parties themselves.
What is an implied or constructive condition precedent?
Those imposed by law to do justice
How much of a condition precedent must be performed?
Express conditions must be literally and fully performed, whereas constructive conditions, which ordinarily arise from language of the promise, are subject to the precept that substantial compliance is sufficient.
What are the elements of substantial performance?
- The party made an honest endeavor in good faith to perform its part of the contract;
- The results of the endeavor are beneficial to the other party
- Such benefits are retained by the other party
When the doctrine of substantial performance applies, what kind of damages are available?
expectation damages
In determining whether something is a condition or covenant, what effect does ambiguity have?
There is a presumption that they are covenants, not conditions
