Discharge Of Contract Flashcards
Discharge of contract
The termination of a contract
Discharge by agreement types
Bilateral discharge-both parties gain a new benefit from agreement
Unilateral discharge-benefit gained by one party, trying to convince other party to let them off the obligations of original agreement
4 Forms of discharge by agreement
Novation-substituting contract for a new one
Rescission
Alteration-agreeing to changes
Remission-acceptance of a lesser fulfilment e.g accepting less money
Discharge by breach
When a party fails to perform an obligation, or indicates in advance they will breach (actual/anticipatory)
Case for actual breach
Platform Funding LTD v Bank of Scotland-surveyor surveyed wrong house
Cases for anticipatory breach
Frost v Knight-promised to marry upon fathers death. Before death he retracted. Was a breach
Hochster v De La Tour-need not wait for breach to occur to bring claim if informed intention
Discharge by performance general rule and case
Cutter v Powell-if a contract requires full performance, and not completed, they are entitled to nothing. Died 2 weeks before arrival so widow could not claim for the 6 weeks of work
5 Exceptions to Cutter v Powell
Substantial performance Severable contracts Acceptance of part performance Prevention of performance Breaches concerning time
Substantial performance+case
If party has completed substantially what was required, party can recover appropriate amount to what has been done.
Hoeing v Isaacs-decorated house but C not happy, was entitled to payment as completed substantially
Severable contracts and example
Exception to Cutter v Powell-when payments are due at various stages, rather than in one lump. Usually in building work. Hiring babysitter for 6 weeks and terminating after a week, can still claim for first weeks pay
Acceptance of part performance+case
Exception to Cutter v Powell-if party has shown willingness to accept part performed,
Sumpter v Hedges-ran out of money mid build. D completed the rest himself. C unable to claim for part performance as D had no choice but to accept part performance as left with an incomplete house, so no willingness
Prevention of performance
Exception to Cutter v Powell-you’re stopped from carrying out.
Planche v Colburn-agreed to write a book for D. D changed mind, C entitled to recover damages as was prevented performance
Breaches concerning time
Exception to Cutter v Powell-if performed but not in time given, damages can be given.
Repudiation only available on 3 occasions
1.Express stipulation that time is of essence
2.Surrounding circumstances showing time is critical e.g perishable goods e.g fresh food delivery
3.When one party has already done wrong
Breaches concerning time case
Charles Rickards v Oppenheimer
Purchase of Rolls Royce chassis agreed to by build by a certain date, if not he would cancel. Held:entitled to cancel as express stipulation
Discharge by frustration
If something happens no fault of the parties to make it impossible
