Contract Law (II) Flashcards
Name 3 types of obligations?
- Obligation to give something:
- Obligation to do something
- Obligation not to do something
How is the difference for what type of obligation made?
Difference is made based on the expected outcome:
- Duty to achieve a specific result (minority of cases)
- Duty of best efforts (majority of cases)
How do you make the difference which kind of duty one has?
- Look at surrounding circumstances
- Not a limitative list
Name three elements of your decision on what kind of duty one has
- Way obligation is expressed in the contract
- Contractual price and other terms of the contract
- Degree of risk normally involved in achieving expected result
What is a duty to achieve a specific result?
One is liable of specific, guaranteed result is not achieved. Victim must only prove that guaranteed result was not achieved (burden of proof)
What is a duty of best efforts?
One is liable when one does not do one’s reasonable best to achieve result intended. Victim has to prove that debtor of obligation did not act as a reasonable person acting in the same circumstances (higher burden of proof)
How is quality of performance often determined?
Quality of performance is often determined in contract, but should be reasonable and lot less than average in the circumstances.
How is price determined?
- Price is determined by both parties at moment contact is concluded
1. Fixed price or,
2. Calculation method or reference mentioned in contract - Price can be determined by one party, but if price is unreasonable, a reasonable price will be substituted notwithstanding any contract term to the contrary.
What is a conditioned agreement?
performance of a contract / obligation is conditional (condition = future uncertain event)
Name two types of conditioned agreements?
- Suspensive condition or condition precedent
- Resolutive condition or condition subsequent
Conditions based on the will of the debtor are invalid suspensive conditional agreements
Name two characteristics a suspensive condition or condition precedent?
- There is a valid agreement
- Performance is suspended until event occurs
Name two characteristis of a resolutive condition or condition subsequent?
- Valid agreement and contract is performed
- If event occurs, contract is terminated automatically
Name two terms of performance of a contract?
terms refers to future event which will certainly happen:
1. Suspensive term
2. Resolutive term
When do parties have to perform?
- Period of Time which is mentioned or determined in the contract
- If not, within a reasonable time after the conclusion of the contract
When is early performance acceptable?
- Refusal is reasonable
- Early performance by debtor does not impact claimant’s own obligations.
What is a resolutive term?
There is a valid agreement & contract is performed. After event, contract is automatically terminated.
What is a suspensive term?
There is a valid agreement but performance is suspended until the date mentioned in contract
