Discharge Flashcards
What are the 3 types of discharge?
Discharge by performance
Discharge by agreement
Discharge by breach
What is discharge by performance?
A party is discharged when it has precisely and imperfectly fulfilled their obligations
What case is related to discharge by performance?
Cutter v Powell
Facts of Cutter v Powell
A seaman died mid voyage
His wages were supposed to be paid at the end of the voyage
His widow attempted to claim his wages
Outcome of Cutter v Powell
Widows claim failed as the seaman had not completed his obligations. Therefore couldn’t be discharged by performance and she was not entitled to money
What is s13-15 of the sale of goods act
It is related to discharge by performance and states that a buyer has the right to reject goods if the standard doesn’t apply
What are the exceptions to discharge by performance…
Partial performance Substantial performance Prevention of performance Tender of performance Time of performance
What type of obligations do the exceptions apply to?
Serverable obligations
Explain partial performance
If the whole contract has not been breached payment can be expected for part of the performance
What case is relevant to part performance?
Robert v Havelock
Facts of Robert v Havelock
C was repairing a ship
Contract did not say when payment was to be made
Before completing he requested payment of work to date
D refused
Outcome of Robert v Havelock
Because the contract did not state when payment was to be made there was no breach.
C could expect money for partial performance before completion
Explain substantial performance…
Contract may be enforced or damages are awarded for the incomplete performance (price of contract - cost of incomplete performance = damages awarded)
Problem for courts - what is substantial?
What is prevention of performance?
Where one partly wrongly prevents the other party from fulfilling the contract then the discharge rule doesn’t apply
Explain tender of performance
If a party cannot complete obligations without the cooperation of the other party then they may be able to apply for this
Other party accepts or rejected
If rejected they will be discharged
Explain time of performance
Discharged based on them if contract contains a ‘time is of the essence’ this often depends on subject matter e.g with perishables
explain discharge by agreement
Consideration is necessary
With executed consideration new consideration is needed, or it need to be written in a deed or one party can give a waiver
What are the two types of discharge by breach?
Anticipatory
Repudiatory
What is anticipatory breach?
One party indicates their intention not to perform their contractual obligations. This may be explicitly or implicitly implied
Explain repudiatory breach
This is a serious breach which releases the other party from duties and entitles them to compensation
If there has been a repudiatory beech what choices are available to the innocent party?
Affirm the breach = accept it and get party to carry out obligations
End contract = repudiation of contract
