Discharge By Performance Flashcards
Strict rule
Performance must be complete and exact
If a party hadn’t fulfilled exact obligations under the agreement
Other party didn’t have to fulfil their obligations either
Case for strict rule
Cutter v Powell
Under what circumstances can the strict rule be avoided
Prevention of full performance
Acceptance of part performance
Divisible contracts
Substantial performance
Prevention of full performance
If one party prevents other from carrying out the contract
The innocent party can claim on a quantum meruit basis
What does quantum meruit mean
The party can claim for the work they did even though the obligation hasn’t been fulfilled as agreed
Case for prevention of full performance
Plance v Colburn
Acceptance of part performance
Has to be consent for this to apply
Consent has to be free from pressure
If parties agree one party doesnt have to complete the entire contract then the contract must be paid on quantum merit basis
Must be agreed
Not consent if party had no option
Case for no consent for part performance
Sumpter v Hedges- no choice
Divisible contracts
If contract has seperate parts
Must be clearly divided
Non completion of one part doesn’t breach entire contract
Case for divisible contracts
Richie v Atkinson
Substancial performance
When a party has done substantially what is required under the contract so the court believes they’ve done enough
If there is substantial performance payment must be completed for appropriate amount
Amount to be paid is decided on a case by case basis
When will payment for substantial performance not apply
If the contract is seen as a single transaction
As in Cutter v Powell
Case for substancial performance
Darkin & Co v Lee
Case for substantial performance- paid on quantum meruit basis
Hoenig v Isaacs
If the work has not been substantially performed
Party who carried out the work is entitled to nothing
Bolton v Mahadeva
Whether the time of performance is important
In some contracts a time is inserted
Should the innocent party be able to repudiate the contract if this particular term is breached (condition)
Under what circumstances is time seen as a condition
• Parties expressly stated in the contract that time is of the essence
• Time of completion is critical for the contract
• One party hadn’t performed on time, so the other party had insisted on another date of completion
When no circumstances for time being a condition apply
The term with regards to time is seen as a warranty rather than a condition
Case for time being expressly stated
Union Eagle v Golden Achievement
If time of the essence is waived
Contract must clarify this
So the same issue doesnt arise in the future
Hakimzay ltd v Swailes
Remedies for discharge by performance
• Quantum Meruit
• Repudiation
• Specific Performance
• Damages
