II-2 Contracts 2 Flashcards
Performance: What are 3 types of performance due?
- Never if conditions precedent is not met.
- Same time as receiving consideration: conditions concurrent.
- Never if conditions subsequent passes Statute of limitations.
What is the requirement for completeness of performance under CL?
Substantial performance:
- Is is for practical purpose just as good?
- Was it done in good faith?
- Can party be compensated?
What are 4 buyer’s rights for goods?
- Inspection before payment (unless COD:cash on delivery, CF: cash and freight, CIF: cash, ins, and freight).
- Rejection.
- Acceptance.
- Revocation of acceptance (only for those items that requires the use for a while).
UCC: who has the right to demand assurance? Who has the right to cure?
Both parties.
Seller.
UCC: If seller does not provide cure (assurance), what happens?
Other party can take it as breach (Anticipatory Repudiation) and sue, substitute the seller, or wait.
UCC: will it be a breach if seller sends a non-conforming item before the due date?
No, if the seller sends the right one before the due date.
UCC: Right to cure: what must seller do to exercise this right?
Notify the buyer prior to the performance date.
When is performance discharged?
- When conditions fail.
- When both parties agree and sign release, waiver, or rescission (accord and satisfaction).
- The Novation thing: all parties agree and bring in the third party to replace one.
- Statute of limitations.
- Impossibility (Object test) under CL.
- Impracticability under UCC.
- Illegality.
- Breach.
- Bankruptcy.
What are types of damages and remedies?
- Nominal damage (technical breach, no financial loss) - award nominal amount of $1 or so.
- Compensatory damage - return parties to same position as if there had been no breach.
- Incidental damage - costs, lawyers’ fees
- Consequential damage (damages to third party).
- Liquidated damage (agreed-on-in-advance damages. alternative to compensatory damages) - court will look if it is a reasonable amount and not penalty.
- Punitive damage - available only in fraud cases.
What are types of remedies?
- Specific performance - require breaching party to perform; used against seller in land contracts. Can happen under UCC if goods are rare.
- Rescission and restitution - used in misrepresentation; returns parties to original position.
- Reformation - court uses it to correct often clerical error in contracts.
- Quasi-contract recovery - given when there is no contract.
What is prerequisite for passage of title and risk of loss?
Identification of goods: for fungible goods. they are shipped, marked or otherwise designated for the buyer.
When does identification occur for existing goods?
At the time of contracting.
Non-shipment: When does the title pass when there is document of title and there is no document of title?
Doc: upon delivery of title document.
No doc: At the time of contracting.
When does the title pass when the seller is a merchant and non merchant?
M: Upon receipt.
Non m: Upon tender actual purchase.
When does the title pass when there is Bailment: warehouse (third party)?
When there is doc of title or other doc, upon receipt of the doc.
No doc: when buyer is notified goods are available.
