Performance & Excuse of NonPerformance

Question 1

Performance at Common Law

Answer 1

Substantial Performance

Question 2

Performance under Article 2

Answer 2

Perfect Tender

Also requires all parties to act in Good Faith

Question 3

Art 2 - Noncarrier cases - Tender of Delivery

Answer 3

Seller must give the buyer notice reasonably necessary to enable her to take possession of the goods.

The tender must be at a reasonable hour at the seller’s place of business (or home)

Question 4

Buyer’s Obligation to Pay: Carrier v Noncarrier

Answer 4

Carrier

• price is due only when buyer recieves good

Noncarrier:

• price due concurrently with tender of delivery

Question 5

Buyer’s right to inspection

Answer 5

Buyer has right to inspect goods before she pays unless the K provides for payment COD

Question 6

Definition of Condition

Answer 6

Means either:

• an event or state of the world that must occur or fail to occur before a party has a duty to perform; or
• an occurence or nonoccurence which releases a party from his duty to perform.

Question 7

Failure of Condition v Breach of K

Answer 7

Failure of a K provision that is only a condition is not a breach of K, but it discharges the liability of the promisor whose obligations on the conditional promise never mature

Question 8

Condition Precedent

Answer 8

Condition must occur before performance is due

Once this occurs, performance is due

Question 9

Conditions Concurrent

Answer 9

Conditions to occur at the same time

If one condition has occured, performance of the other side is due

Question 10

Condition Subsequent

Answer 10

Condition cuts off already existing duty.

Duty to perform is excused.

Question 11

Personal Taste or Judgment

Answer 11

Condition of satisfaction is fulfilled only if the promisor is personally satisfied.

Promisor’s lack of satisfaction must be in good faith.

Rejection in bad faith or failure to examine performance will make the condition excuded.

Question 12

Satisfaction of 3rd person as Condition

Answer 12

Actual personal satisfaction is required so long as honest and in good faith

Question 13

Anticipatory Repudiation & its requirements

Answer 13

Occurs if a promisor, prior to time set for performance, indicates he will not perform when the time occurs.

Requirements:

1. Only applies to bilateral K with executory unperformed duties on both sides
2. the repudiation must be unequivocal
   
   • prospective inability or unwillingness to perform is not anticipatory repudiation because it is not unequivocal

Question 14

In the case of anticipatory repudiation, nonrepudiating party has 4 alternatives:

Answer 14

1. treat the repudiation as total repudiation and sue immedietly;
2. suspend his own performance and wait to sue until performance date;
3. treat the repudiation as an offer to rescind and treat the K as discharged; or
4. ignore the repudiation and urge the promisor to perform

Question 15

Retraction of Repudiation

Answer 15

May withdraw unless other party has cancelled or materially changed her position in reliance. Then the repudiation is finaal

Question 16

Conditions may be exucsed by:

Answer 16

1. impossibility
2. impracticability
3. frustration

Question 17

Test for Impracticability

Answer 17

1. extreme/unreasonable difficulty and/or expense; and
2. its nonoccurance was a basic assumption of the parties

Question 18

Contracts for Sale of Goods - Events sufficient for discharge

Answer 18

Shortage of raw materials or inability to achieve because of war, etc.

Increase in costs are not sufficient unless they change nature of the K.

Question 19

Discharge from Frustration & Test:

Answer 19

When the purpose of the K has become valueless b/c of something intervening, some courts will discharge. Must show:

1. superveining act
2. did not reasonably foresee
3. purpose of the K has been almost/completely destroyed
4. purpose of K was realized by both parties

Question 20

Meaning of “accord,” “satisfaction”

Answer 20

accord questions will have an agreement by the
parties to an already existing obligation to accept a different performance in satisfaction of the existing obligation.

Question 21

Effect of accord AND SATISFACTION

Answer 21

If the new agreement (“the accord”) is performed
(satisfaction), then performance of the original obligation is excused.

If the accord is not performed, then the other party can
recover on either the original obligation or the accord