Performance

Question 1

A breaching party who is adversely affected by a mistake may avoid performance if at least one of the parties held an erroneous belief that was not in accordance with the facts or the law at the time of contract

Answer 1

Mistake

Question 2

What is a mistake?

Answer 2

Belief not in accordance with facts at time of contract, including law

Question 3

three elements for mutual mistake

Answer 3

1. basic assumption
2. material effect on exchange
3. Affected party bears no risk

Question 4

three ways in which party may bear the risk of mistake:

Answer 4

1. Allocation by party agreement
2. Allocation by court
3. Conscious ignorance

Question 5

When both parties enter into the contract based on the same mistake

Answer 5

mutual mistake

Question 6

Unilateral Mistake Elements

Answer 6

1. Basic assumption;
2. Material effect on exchange;
3. Affected/mistaken party; bears no risk;
4. Unconscionability, knowledge or fault

Question 7

What are the two types of mistake?

Answer 7

unilateral and mutual

Question 8

What is changed circumstances?

Answer 8

a breaching party may avoid performance if the circumstances change such that performance is impossible or impracticable or the principal purpose of the contract is substantially frustrated

Question 9

the impracticability standard of changed circumstances means

Answer 9

extreme and unreasonable burden

Question 10

Frustration of purpose standard of changed circumstances

Answer 10

a party’s principal purpose is substantially frustrated if the other party’s performance has become virtually worthless, regardless of whether it is possible or practicable

Question 11

The Perfect Tender Rule provides that

Answer 11

all goods, including the delivery of those goods, must conform to the contract in every respect

Question 12

A buyer may revoke acceptance in these situations

Answer 12

reasonable assumption of cure
difficulty of discovery
seller’s assurances

Question 13

If the breaching party has already rendered part performance, then the injured party is entitled to a remedy only if there is a

Answer 13

material breach

Question 14

If the breaching party has rendered no performance or made an aniticpaptory repudiation, then the injured party is

Answer 14

entitled to a remedy in court

Question 15

The materiality of a breach is generally based on a consideration of these significant circumstances:

Answer 15

loss of benefit to the injured party
adequacy and extent of compensation to injured party
disproportionate forfeiture by the breaching party
likelihood of cure by the breaching party
absence of good faith or fair dealing by breaching party

Question 16

What does the common law doctrine of substantial performance say?

Answer 16

a breach is immaterial if the breaching party has rendered a good faith performance that is substantially similar to what was promised in the contract

Question 17

A _________ may take the form of a statement that clearly indicates an intent to breach (not just a mere expression of doubt) or a voluntary, affirmative act that renders a party unable to perform

Answer 17

anticipatory repudiation

Question 18

An anticipatory repudiation may be _____ before it becomes final

Answer 18

retracted

Question 19

An anticipatory repudiation is retracted if

Answer 19

the injured party receives notice that full performance will be rendered or knows that the events causing the repudiation have ceased to exist

Question 20

An anticipatory repudiation is final if

Answer 20

the injured party has materially changed position in reliance on the repudiation or has indicated that the repudiation is considered final

Question 21

A party may suspend performance and demand _______ ____ if there are reasonable grounds to believe that the other party will commit a breach

Answer 21

adequate assurance