Discharge of a Contract^ Flashcards
Discharge of a Contract
How a contract ends
Usual methods are by performance as both parties done what they agreed on
Can also end by breach
- End automatically by breach of condition
- Rescission (seek to end) if breach of warranty
Performance
Usual method of discharge
Both parties done what they agreed
Cutter V Powell
Performance must be complete and exact to be able to claim (the fixed fee)
Harshness of the rule has been changed in some way
Planche V Colburn
If one person prevents the other from performing their part of the C, the innocent party can claim to be paid on a quantum meruit basis
For what is it worth: paid as much as it is worth for work
Ritchie V Atkinson
severable contract - C divided into parts
If a contract has separate parts, then non-completion of one part does not breach the whole contract
Substantial Performance
Nearly completed everything
If a party has done substantially what was required under the C, then the doctrine of substantial performance may apply
Dakin & Co. V Lee
Performance was complete even though some of the work was defective, so must be paid to what was done (quantum meruit basis)
Is there a substantial performance?
No clear definition of SP, so its down to the courts to decide
Hoenig V Issacs - there was
Bolton V Mahadeva – there was not
Sumpter V Hedge
acceptance of part performance
If one party agrees that the other party need not complete the entire C, the C must be paid on a quantum meruit basis
Charles Rickards Ltd V Oppenheim
Time could be a condition of the contract
The Effect of Time
The court regards time as a condition if
The parties have expressly stated in the contract that time is of the essence of the contract
In the circumstances time for completion of the C is critical
One party has failed to perform on time and the other has insisted on a new date for completion of the contract
Effect of Delay
The effect of delay is treated as a breach of condition if any of these are present
If not then it will be treated as an innominate term = damages
British Electric V Electric Railways
duty to mitigate
A claimant is not bound to go to extraordinary lengths to mitigate loss, only what it reasonable in the circumstances
