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Bus Law > Round 2 Lecture 5 > Flashcards

Round 2 Lecture 5 Flashcards

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1
Q

purpose of analysis

A

to determine whether a reach has occurred

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2
Q

effect of a condition

A

creates, extinguishes or limits a contractual duty- you are in favor of conditions if they create for you opportunities to escape contractual responsibility

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3
Q

types of conditions

A

express, implied-in-fact, or implied-in-law

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4
Q

express

A

using words - you contractually agree to do something “provided that “ or “subject to”

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5
Q

implied-n-fact

A

a condition that can be implied from the circumstances or the parties’ conduct

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6
Q

implied-in-law

A

constructive conditions- a condition to your obligation to pay rent to your landlord is the availability for occupancy of the apartment you rented

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7
Q

after a contract is entered into, what happens to the contractual duties of the parties if the duty was not made conditional or it is conditional but the condition has not been satisfied

A
  • must be discharged by performance
  • the parties by agreement agree to discharge each other from performance (mutual rescission)
  • the obligor is excused from performing the duty
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8
Q

mutual rescission

A

the parties agree to end their contract

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9
Q

substituted contract

A

the parties agree to substitute for one contract a new contract

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10
Q

accord and satisfaction

A

the parties agree to substitute one type of performance of a duty for another that was in the original contract

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11
Q

if the duty is not discharged by performance

A

then the obligor is in breach of contract for failure to perform the duty

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12
Q

if the breach is material

A

the aggrieved party is excused from performing the contract

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13
Q

if the breach is nonmaterial

A

the aggrieved party is not excused from performing the contract but is entitled to damages from the breaching party for breach of contract

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14
Q

when are contractual duties discharged?

A

if they are performed

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15
Q

total performance

A

under certain circumstances it is reasonable to expect that the performance by a party under a contract will be strictly in accordance with the contract-other times, expecting such strict compliance is unreasonable and probably not achievable

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16
Q

2-601 perfect tender rule under UCC

A

perfection is the standard for seller’s performance under a sale of goods contract (but the seller has a right to cure imperfect performance)

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17
Q

doctrine of substantial performance

A

when does less than 100% performance not constitute a material breach which would discharge the non-defaulting party?

  • applicable to certain contracts
  • perfection or substantial performance
  • breach must be unintentional and not in bad faith
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18
Q

if perfection is not the appropriate standard

A

performance must be substantial

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19
Q

measure of recovery

A

what damages can the parties recover

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20
Q

substantial but not perfect performance-recovery:

A

the aggrieved party will receive the cost of replacement or repair or in some jurisdictions the amount of diminished (reduced) value

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21
Q

not substantial performance - recovery:

A
  • breach is material
  • the aggrieved party has the right to not perform the contract, but the breaching party may be entitled to equitable recovery for value of work actually performed
22
Q

time for performance

A

generally performance by the stated time or within a reasonable time thereafter is acceptable - a minor delay in performing is not a breach

23
Q

“time is of the essence”

A

failure to perform by this time is an automatic material breach - newspaper ads specifically for 4th of July aren’t run till after the holiday

24
Q

considerations for time of the performance

A
  1. is it of the essence?
  2. is that essence express or implied?
  3. effect-if it is of the essence failure to comply is material breach
25
Q

perfect tender rule

A

time is of the essence as to sale of goods

26
Q

why is timing important?

A

tells us if the breach was material or immaterial

27
Q

factors of a material breach

A
  1. was performance substantial
  2. was time of the essence
  3. was breach serious
  4. was breach intentional
  5. does contract specify what breaches are material
28
Q

excuses for non performance

A

the law provides you with an excuse for whatever would otherwise be your breach of the contract

  • legal impossibility
  • frustration of purpose
  • commercial impracticability
29
Q

legal impossibility

A
  • death or incapacity of the promisor prior to the performance of a personal service contract
  • the destruction of the subject matter of a contract prior to performance
  • supervening illegality which makes performance of the contract illegal
30
Q

frustration of purpose

A

some unanticipated event has occurred and as a result the contract now has no value to one party-one party’s principal purpose in making the contract is frustrated w/p the party’s fault by the occurrence of an event, the non-occurrence of which was a basic assumption on which the contract was made

31
Q

commercial impracticability

A

mechanism for shifting risk in accordance with the parties’ presumed intentions-some unanticipated even has occurred and performing the contract would be extraordinarily difficult and unfair to one party (ex: weather related event, outbreak of war, earthquake)

32
Q

elements of commercial impracticability

A
  1. did an unexpected event occur?
  2. did the event render performance impossible or impracticable
  3. did the non-performing party assume the risk that the event would occur
  4. was the nonperforming party at fault in causing the unexpected event
33
Q

impracticable

A

forcing contract is no longer financially sensible- easier to show than impossibility

34
Q

examples to which doctrine may apply to excuse a party from performance

A
  • death or incapacity of a person necessary for performance
  • destruction of subject matter necessary for performance
  • failure of anticipated source of supply
  • supervening illegality, gov. regulation, or order
  • extraordinary weather event or other act of God
35
Q

examples of non-examples

A
  • increased costs
  • labor disputes
  • change of market conditions
36
Q

purpose of remedies

A

to compensate the aggrieved party

37
Q

common law remedies

A

legal remedies and equitable remedies

38
Q

compensatory damages

A

to place aggrieved party in as good a position as if the other party had performed

39
Q

reliance damages

A

to place party in as good a position as if the contract had not been made (used when compensatory, incidental, and consequential damages cannot be reasonably ascertained)

40
Q

damages for misrepresentation

A
  • rescission available as alternative remedy
  • out of pocket damages
  • benefit of bargain damages
41
Q

out of pocket damages

A

difference between value of what is received and what is given

42
Q

benefit of bargain damages

A

difference between value of what is received and what it would have been worth in absence of the misrepresentation.

43
Q

remedies available to fraudulent misrepresentation.

A

allows benefit of bargain damages in majority of jurisdicitons

44
Q

remedies to non-fraudulent misrepresentation

A

typically limited to out of pocket damages

45
Q

foreseeability limitation on monetary damages

A

should breaching party have known that breach would result in aggrieved party’s losses? foreseeable if losses resulted from the breach:

  • in the ordinary course of events or
  • as a result of special circumstances about which the party in breach had reason to know
46
Q

unforeseeable damages

A

not recoverable for loss if the party in breach did not have reason to foresee as probable result of the breach when the contract was made

47
Q

mitigation of damages

A

the aggrieved party must take reasonable steps to lessen or mitigate damages that result from breach of contract-the injury party may not recover for damages for loss that he could have avoided with reasonable effort and without undue risk, burden, or humiliation

48
Q

equitable remedies

A

-equitable remedies are generally not available if there is an adequate remedy at law available (money damages)

49
Q

specific performance equitable remedy

A

if money damages are wholly inadequate as a remedy-compels actual performance
ex: sale of one of a kind painting

50
Q

injunctions

A

a court order enjoining (requiring) a person from doing a specific act or engaging in specific conduct

51
Q

reformation

A

permits the court to rewrite a contract to express the parties’ true intentions (ex: clerical error)

Bus Law (20 decks)

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