Level 7: Discharge of Contracts Flashcards
Discharge: Operation of Law
discharge of contract goes against the desire of one or more of the parties
Discharge Operation of Law: Full Performance
both parties did what they were supposed to do and received what they had hoped to receive, once all obligations are performed, a contract is considered executed and discharged
Discharge Operation of Law: Expiration
once that date passes parties are released from future obligations and the contract discharges
Discharge Operation of Law: Statute of Limitations
he event a party to a contract defaults in their performance, the wronged party must bring a lawsuit against the defaulting party within the time frame as set forth by the statute of limitations
Discharge Operation of Law: Lack of Legal Element
the contract lacks legal standing or purpose or is unlawful in some way
Discharge Operation of Law: Death or Incapacity
does not relieve the party of contractual obligations, an exception to this rule is made for personal services contracts
Discharge Operation of Law: Bankruptcy
result in the discharge of a contract
Discharge Operation of Law: Alteration of the Contract
a party to the contract attempts to modify the terms or conditions of the original contract in a material way, with or without the other party’s consent or knowledge
Discharge Operation of Law Acts of the Parties: Merger
the original contract can be merged into a new agreement, and that the original agreement is discharged in the process
Discharge Operation of Law Acts of the Parties: Mutual Agreement
mutual release of the duties that existed in the original contract qualifies as consideration in the new contract
Discharge Operation of Law Acts of the Parties: Cooling-off Period
a window of time within which a party has the right to rescind specific types of contracts for any reason and without liability
Discharge Operation of Law Acts of the Parties: Novation
a mutual agreement of the parties to replace an existing contract with a new one
Discharge Operation of Law Acts of the Parties: Assignment
an original party to the contract transfers their rights to a new party, does NOT discharge original contract, the original party remains liable if the assigned party does not live up to the obligations of the contract
Discharge Operation of Law Acts of the Parties: Accord and Satisfaction
parties agree to discharge the original contract in favor of a new one, wherein accepted performance is often less than what was initially owed
Discharge Operation of Law Acts of the Parties: Revocation
a unilateral act, and, if the revoking party is unable to show cause, they could incur liability for their decision to revoke and may still be obligated to their duties according to that agreement
Discharge Operation of Law Acts of the Parties: Renunciation/Abandonment
renounces their authority (and willingness) to act on the principal’s behalf
Discharge of Contracts Visual Aid
Breach of Contract
a party to an agreement who does not perform according to the terms and conditions of a contract (without cause)
Breach of Contract: Specific Performance
courts ruling to compel the party to fulfill the contract as originally agreed
Breach of Contract: Rescission
attempts to put the parties back in a position as though the contract never existed
Breach of Contract: Forfeiture
a way to terminate the contract relationship but with compensatory recognition that one party was injured as a result of the contract
Breach of Contract: Suit for Damages
suit must adhere to the statute of limitations and the courts are typically concerned with restoring the wronged party to the place that they were financially prior to the contract
