Contract-Performance Flashcards
PWCE performance warranty condition excuse + assign/delegation
Parol evidence rule
prohibits introduction of prior extrinsic evidence that contradicts the terms of a written K.
Parol evidence rule: If completely integrated,
cannot introduce evidence of a prior or contemporaneous agreement between the parties
Parol evidence rule: If partly integrated
If partly integrated, can introduce supplementary terms that are consistent with the K. but NOT contradictory terms.
Parol evidence: exceptions
(1) defense to K formation/enforcement
(2) condition precedent to existence of K;
(3) evidence of a second separate deal; and
(4) evidence interpret an ambiguous term
(5) If UCC—course of performance, dealing, and trade usage to explain/supplement (not contradict) terms, even if terms are not ambiguous.
Interpreting K terms—priority
Priority highest to lowest: express terms, course of performance, course of dealing, trade usage.
Parol evidence: course of dealing
course-of-dealing evidence is admissible to explain or supplement a final written integrated agreement. (even if term is not ambiguous)
e.g. oral negotiations
Performance of a condition C/L
C/L: A party who substantially performs can trigger the other party’s obligation to perform. © Express conditions: doctrine of substantial performance does not generally apply
In defining substantial performance, consider
willful breach—substantial performance is less likely to be found when a party intentionally provides services materially different from what he promised.
benefit of the bargain—if the nonbreaching party does not receive the substantial benefit of the bargain, that is material breach.
Recovery upon substantial performance
Party who substantially performed: can recover on the K
Party who fails to substantially perform: may still recover restitution.
Performance of a condition under UCC
perfect tender
Seller’s duty under UCC
Seller must
a) transfer ownership and
(b) make a conforming tender (perfect goods and perfect delivery
Seller’s duty of perfect delivery
Seller must comply with
(1) timing
(2) place;
(3) manner of tender;
(4) method.
If not specified by K, UCC default presumption is
(1) timing (reasonable time after K);
(2) place (seller’s place of business);
(3) manner of method (one delivery);
(4) method (shipment K—seller must deliver to carrier and give notice to buyer).
Seller’s duty to deliver perfect goods–what are perfect goods
Perfect goods if conforms to express warranty and implied warranties.
Express warranty:
arises when seller makes a promise or affirmation of fact.
© statement of puffery or opinion
Disclaimer of express warranty
general disclaimer of all warranties is NOT sufficient to disclaim an express warranty.
© but if salesperson made an express warranty, and P later signs a K with disclaimer, P may not be able to introduce it due to parol evidence rule.
Implied warranty of fitness for a particular purpose
arises when ∑
(a) seller has reason to know buyer has a particular use of goods and
(b) buyer relies on seller’s skill to select the goods.
Implied warranty of merchantibility
arises when ∑
(a) seller is a merchant dealing with goods at issue;
(b) This warranty warrants that goods are fit for ordinary commercial purpose.
Buyer right to inspect:
Buyer has right to inspect goods before deciding whether to accept or reject.
Right to inspect is generally a condition to payment unless K specifies otherwise.
Buyer’s acceptance occurs when
(1) expressly accepting;
(2) using the goods; or
(3) failing to reject
Buyer can revoke acceptance when
Revoking acceptance: allowed if ∑
(a) nonconformity substantially impairs the value fo the buyer; and
(b) (i) buyer didn’t discover nonconformity through no fault of his own; or (ii) buyer accepted nonconforming goods thinking seller would cure it (and he didn’t).
