Excuse of K nonperformance Flashcards
Is anticipatory repudiation an excuse for non-performance? What is it?
Yes, excuse. Anticipatory repudiation is an unambiguous statement or conduct (i) that the repudiating party will not perform (ii) made prior to the time that performance was due.
- Anticipatory repudiation generally gives rise to an __________ claim for damages for breach unless ___________.
Anticipatory repudiation generally gives rise to an IMMEDIATE claim for damages for breach UNLESS the claimant has already FINISHED her performance.
Can you retract anticipatory repudiation?
Anticipatory repudiation can be withdrawn (retracted) so long as there has not been a material change in position by the other party. If the repudiation is timely retracted, the duty to perform is reimposed but performance can be delayed until adequate assurance is provided.
EXCUSE BECAUSE OF INSECURITY ABOUT WHETHER THE OTHER GUY IS GOING TO PERFORM. When does it apply? How does it work? Three concepts for insecurity re performance?
Uncertainty applies only to the sale of goods. E.g., widget producer says he’ll deliver in March. You find out he missed all Feb deliveries. . If the words or conduct of one party give “reasonable grounds for insecurity,” then the other party can, in writing, demand adequate assurance and if it is “commercially reasonable,” can suspend performance until it gets adequate assurance. The three concepts again are (1) reasonable grounds for insecurity, and (2) written demand for adequate assurance, and (3) commercially reasonable to stop performance.
Excuse b/c of improper performance: compare Art 2 UCC vs comm law? Does improper performance excuse non-performance? If so, when for UCC v. comm law.
UCC = perfect tender rule ( right for a buyer of goods to insist upon “perfect tender” by the seller)
Comm law = material breach rule (if there was material breach, then no substantial perf –> mutually exclusive)
Material breach b/c of quantity of performance under common law? What’s the threshold for materiality? Must you pay if counterparty hasn’t materially performed? Quasi-K? Divisible K corrollary?
If less than half of the work has been done, the breach is material b/c there’s lack of amount of performance. No obligation to partial payment if material breach (e.g., someone performs 20% of K, isn’t owed 20% of payment). Partial performer can recover partial payment under quasi-K. IF someone Ks to paint 10 apts at $1K per and only does 2 apts, then you owe $2K.
Does nonoccurrence of an express condition excuse nonperformance? What language do you look for in K? What standard is used to determine if condition satisfied?
Yes. Express language can limit obligations when K uses the following words: “if,” “only if,” “provided that,” “so long as,” “subject to,” “in the event that,” “unless,” “when,” “until,” and “on condition that.” NON-OCCURRENCE OF EXPRESS CONDITION EXCUSES NONPERFORMANCE.
Strict compliance is required to satisfy condition. Does not apply to condition of personal satisfaction.
How can an express condition be eliminated so that its nonoccurrence
does not affect performance obligations? 2 ways
- Waiver: person who benefits voluntarily gives up express condition.
- Prevention: the person protected by express condition PREVENTING OR HINDERING occurrence of express condition.
difference between conditions precedent and conditions subsequent?
Conditions subsequent occur subsequent to the start of performance and excuse performance when they occur. For example, you and Spike Lee agree that he will sell you his Knicks courtside seats for $10 a game until the Knicks are in first place. It’s a post-closing condition on continued performance – still strict compliance standard.
What is test for whether rescission (cancellation) excuses nonperformance?
Both parties agree to cancel the K. Key is whether performance is still remaining from each of the contract parties. Rescission valid if there is still performance remaining on both sides.
Accord and satisfaction means? Effect thereof? Requirement to excuse non-performance of original K?
Substituted performance – accord questions will have an agreement by the parties to an already existing obligation to accept a different performance in satisfaction of the existing obligation. Effect is that if new agreement is performed, then performance of original obligation is excused. NEW AGREEMENT = ACCORD. SATISFACTION = FULFILLED NEW OBLIGATION. Can still recover on original if no satisfaction of new accord.
Modification of K excuses performance when?
When you MAKE A SUBSTITUTED AGREEMENT, performance is excused. Modification is an agreement by parties to an existing obligation to accept
a different agreement in satisfaction of the existing obligation.
Difference b/t accord and satisfaction versus modification?
“Accord and satisfaction” will include “IF/THEN.” Modification is agreement to do different thing.
Novation def? Excuses perf?
Yes, it excuses performance. A novation is an agreement between BOTH parties to an existing contract to the substitution of a new party, i.e., same performance, different party.
Diff b/t novation and delegation?
In novation, both original parties agree to substituted person performing, and original person who got subbed out is excused for nonperformance. In delegation, one party delegates the work to someone else, and this doesn’t excuse non-performance by contracting party who delegates.
