Discharge Of Contract Flashcards
What is discharge of contract?
The termination of the contractual obligations of the parties involved.
What does ‘discharge by performance’ entail?
Cutter v Powell
Parties each do what was agreed. Performance must be complete and exact.
What is a divisible contract?
Ritchie v Atkinson
One contract can be seen as having several parts; non-completion of one part is not a breach of the whole.
What is substantial performance?
Hoenig v Isaacs
Bolton v Mahadeva
Where substantially what was required has been done, payment must be made in proportion to the amount done.
What can happen if one party prevents full performance?
Planche v Colburn
The innocent party can claim to be paid Quantum Meruit.
What does acceptance of part performance require?
Sumpter v Hedges
Must be agreed upon voluntarily and paid on a quantum meruit basis.
What is the effect of a term regarding time of performance?
Charles Rickards v Oppenheim
Time is usually a warranty unless expressly stated as time being of the essence.
What is actual breach of contract?
Occurs when a party fails to perform their obligations under the contract.
What are the three circumstances of actual breach?
- Renunciation by a party of their liabilities
- Impossibility created by their own act
- Total or partial failure of performance
What is a repudiatory breach?
A serious breach that allows the contract to be terminated.
What are the three ways a repudiatory breach can occur?
- Breach of condition
- Refusal to perform the contract
- Sufficiently serious breach of an innominate term
What is anticipatory breach?
Hochester v De La Tour
When a party gives notice that they won’t be performing or completing the contract.
What can the innocent party do in the case of anticipatory breach?
Sue immediately or wait until the contract is actually breached.
What is the aim of damages for breach?
To put the claimant in the position they would have been in if the contract was successfully completed.
What is discharge by frustration?
When a contract is prevented from occurring by an event outside the parties’ control.
What are common causes of frustration?
- Impossibility of performance (Jackson v union marine insurance) or (Robinson v Davidson)
- Contract becomes illegal to perform (Denny, mott and Dickinson v James)
- Radical change of circumstances (krell v Henry)
What is self-induced frustration?
When frustration arises from a party’s own actions.
What does the Law Reform (Frustrated Contracts) Act 1943 state about money paid before frustration?
Money paid before frustration is recoverable.
What does section 1(4) of the Law Reform (Frustrated Contracts) Act 1943 allow?
The court may require a party to pay for any valuable benefit received.
What is Quantum Meruit?
Payment for work done based on the value of the services provided.
What is the consequence of a breach of condition?
The contract can be terminated.
What happens if a party has a specific termination right in a contract?
They can terminate the contract over and above general rights.
True or False: Frustration automatically terminates the contract at the time of the event.
True
When frustration cannot apply
Self induced (maritime national fish v ocean trawlers)
The contract has become less profitable ( Davi’s contractors v fareham)
The event was a foreseeable risk or mentioned in the contract
The law reform (frustrated contracts) act 1943
S1.2
That a person can recover money paid under a contract prior to a frustrating event
The law reform (frustrated contracts) act 1943
S1.3
States that where a party has obtained valuable benefit other than money, the party receiving the benefit can be ordered to pay a just sum in return to pay for the benefit
