Mutuality Principle

Question 1

Erskine, Institute of the Law of Scotland, 3.3.86: (3)

Answer 1

1. A ‘mutual contract’ is one in which obligations on each side are causes of each other. Obligations are interdependent.
2. The right to performance of such mutual obligations is not absolute but conditional.
3. The condition is that performance cannot be demanded unless given in return.

Question 2

Four remedies to breach of contract

Answer 2

Judicial:

1. go to court seeking interdict or specific implement
2. go to court seeking damages

Self-help remedies:

1. retention (performance is withheld until the contract-breaker repairs the breach)
2. rescission (the contract is terminated altogether - the breach must be serious for this to apply)

Question 3

McBryde argues that the concept of mutuality involves at least five ideas:

Answer 3

1. A party who is in breach of obligations cannot enforce performance by the other party (Turnbull v McLean 1874)
2. The party who is not in breach may withhold performance until the other has performed or is seen to be willing to perform the counter stipulations (Meikle & Wilson v Pollard 1880)
   Once the breach ends so does the right to suspend performance (Macari v Celtic F.C. 1999)
3. The mutuality concept only applies if the obligations of the parties are the causes of one another or are reciprocal undertakings (Macari v Celtic F.C. 1999)
4. The operation of the contract can be affected by the express terms of the contract (Hoult v Tourpie 1999)
5. It may not be for any breach that a party can withhold performance (Barclay v Anderson Foundry 1856)

Question 4

Turnbull v McLean 1874

Answer 4

A party who is in breach of obligations cannot enforce performance by the other party

Question 5

Meikle & Wilson v Pollard 1880

Answer 5

The party who is not in breach may withhold performance until the other has performed or is seen to be willing to perform the counter stipulations

Question 6

Macari v Celtic F.C. 1999: (2)

Answer 6

Once the breach ends so does the right to suspend performance

The mutuality concept only applies if the obligations of the parties are the causes of one another or are reciprocal undertakings

Question 7

Hoult v Tourpie 1999

Answer 7

The operation of the contract can be affected by the express terms of the contract

Question 8

Barclay v Anderson Foundry 1856

Answer 8

It may not be for any breach that a party can withhold performance

Question 9

Inveresk v Tullis Russell 2010

Answer 9

Obligations are presumed to be counterparts unless clear indication to the contrary

Obligations must normally be in the same contract but need not be as long as part of a single transaction

Question 10

Bank of East Asia v Scottish Enterprise 1997

Answer 10

Obligations must also be contemporaneous