Performance And Discharge Flashcards
Discharge
A party has no more duties under contract
Most contracts are discharged by full performance
Both parties can agree to discharge
Condition precedent
Some event has to occur before obligation to pay/satisfy contract
Types of conditions
Condition precedent
Condition subsequent
Concurrent conditions
Condition subsequent
Duty arises and then condition
Strict performance
Contract must explicitly demand this
Substantial performance
Usually for service
Failure results in value of work payment
Full payment minus defects
Objective standard
No personal judgement
Contract does not explicitly demand personal judgement
Subjective standard
Personal views will influence judgement
Contract must explicitly demand it
Time of essence clause
Makes dates strictly enforceable
Breach
When one party breaches, the other is discharged
Material breach
Courts will only discharge if breach substantially harms the innocent party and compensation is difficult without discharging the contract
Anticipatory breach
Obvious the contract won’t be honored
Impossibility
Courts will discharge a contract if it is clear it is impossible to fulfill
Commercial impracticability
Fulfilling contract is extremely difficult or unfair for one party after an unforeseen event
Frustration of purpose
Contract no has no value for one party after an unforeseen event
