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Law > Termination fo Contract > Flashcards

Termination fo Contract Flashcards

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1
Q

How can a contract be discharge?

A

By performance
Frustration
Breach

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2
Q

How is a contract discharged by frustration?

A

Where is becomes impossible to perform a contract through no fault of either party
- destruction
- government intervention
- not classed as frustrated if it is more difficult

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3
Q

How is a contract discharged by breach?

A

Failure to perform the contract, this will lead to remedies for breach of contract

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4
Q

What are the rules of a contract being discharged by frustration?

A
  • Contract must have been possible when entered into
  • Contract includes a force majeure clause to deal with contracts that become impossible to perform
  • It will not be discharged where another mode of performance is possible, even is more expensive/ difficult
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5
Q

what is quantum meruit?

A

the defendant to pay damages for the proportion of the contract price that the work is worth at this point

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6
Q

The Law Reform Act 1943

A

Regulates the rights and liabilities of each party following the frustration of a contract
- Any money paid under the contract before the frustrating event is to be payable
- Amounts outstanding are no longer due
- Set off any expenses before repaying any sums or deposits

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7
Q

What is a breach of contract?

A

Where a party does not perform his obligations, he is said to be in breach of contract

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8
Q

What are lawful excuses for a breach of contract?

A
  • Where he has tendered performance but this has been rejected
  • Where the other party has made it impossible for him to perform
  • Where the parties have by agreement permitted non-performance
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9
Q

what is actual breach?

A

occurs at the time performance of the contract was due and happens when:
- one party fails to put forward any sort of performance
- the performance put forward is so inadequate the injured party is substantially deprived of the whole benefit of the contract

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10
Q

what is anticipatory breach?

A

takes place where, before the due date for performance of the contract, one party states or shows by his or her actions that he or she will not be performing the contract

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11
Q

what is expressed anticipatory breach?

A

one of the parties declares before the date of performance that he or she has no intention of carrying out his duties

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12
Q

what is implied anticipatory breach?

A

one of the parties do something which makes the performance of the contract impossible

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13
Q

How can the injured party treat an anticipatory breach?

A
  • Treat the contract as discharged immediately and sue for damages
    -Injured party may continue with his or her obligations under the contract until such time as there is an actual breach of the contractual terms
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14
Q

what is a repudiatory breach and how is it treated?

A

This one deprives an injured party of the main purpose of the contract.
Treat it as if
- the contract has ended
- he/she can affirm the contract

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15
Q

how is a less serious breach treated?

A

If the breach is less serious the injured party will be entitled to damages, but they cannot treat the contract as ended. This would apply when the injured party has received the main purpose of the contract but one of the incidental terms of the contract has been breached.

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16
Q

what are the lawful excuse for when no breach occurs?

A

-One party has offered to perform their obligations under the contract but the other party has refused.
- if one party makes it impossible for the other party to complete his or her obligations
- where the parties have agreed that certain obligations shall not be performed

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17
Q

what is an alternative dispute resolution?

A

parties with a dispute use any type of procedure to come to a resolution rather than going to court

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18
Q

what is an arbitration alternative dispute resolution?

A

private method of dispute resolution whereby the parties have agreed that their dispute will be heard and decided upon by an arbitrator rather than a judge in court

19
Q

what is an mediation and conciliation alternative dispute resolution?

A

are methods by which an independent person will help the parties to come an agreement between themselves.

20
Q

What are the purpose of damages?

A

To put the parties in the position they would be in if the contract had been correctly performed

21
Q

What are the 2 types of measuring damages?

A

Expectation interest
Reliance interest

22
Q

what is unliquidated damages?

A

if there is no provision in the contract for damages the court will determine the damages payable on the basis of these principles

23
Q

what factors are included when calculating unliquidated damages

A
  • remoteness
  • loss of enjoyment
  • measure of the loss
  • reliance loss
    mitigation of loss
24
Q

what are liquidated damages?

A

genuine pre-estimates of the expected loss and are enforceable by court

25
Q

A sum is presumed to be a penalty clause if:

A
  • the amount is out of proportion to the potential losses
  • the same amount is given for a number of potential losses
26
Q

What are the 3 types of injunction that can be granted in the court’s discretion?

A
  1. Mandatory injunction
  2. Prohibitory injunction
  3. An asset-freezing injunction
27
Q

What is a mandatory injunction?

A

directs the defendant to take positive steps to undo something he has already done in breach of contract

28
Q

What is a prohibitory injunction?

A

requires the defendant to observe a negative promise in a contract

29
Q

What is a alternative dispute resolution?

A

a process where parties with a dispute use any time of procedure to resolve their differences rather than go to court.

30
Q

Key facts of a arbitration resolution

A

-the dispute is settled by an independent person
-they act similarly to a judge
-both parties must agree to submit to the process
-agreement sets out the process as well as rights and obligations
-disagreements must be settled in court

31
Q

Key factors of Mediation and Conciliation

A
  • involves an independent third party
    -does not act like a judge
    -works to assist the parties in coming up with their own solution
    -the agreements are not automatically legally binding
32
Q

What are the advantages of an alternative dispute resolution compared to litigation?

A

-Cheaper than going court
-Can choose person so can gain the services of an expert
-Proceedings are held in private
-Can tailor to the needs of the parties
-Quicker than going to court

33
Q

What are the disadvantages of an alternative dispute resolution compared to litigation?

A

-Lacks the legal authority
-Could run on for a long time and end up in court anyway
-No timescale
-Not legally enforceable

34
Q

equitable remedies will not be granted if:

A
  • damages are an adequate remedy
  • the claimant has acted unfairly
  • the claimant has unduly delayed bringing an action to court
35
Q

what is an injunction?

A

order for a person to do or not do something

36
Q

what is asset freezing injunction?

A

prevents defendant from dealing with assets

37
Q

What is an exclusion clause?

A

terms included in written contracts in an attempt to exclude or limit liability for a breach of contract

38
Q

What makes a exclusion clause enforceable?

A

Must be an integral part of the contract

39
Q

what two tests must exclusion clauses be valid for?

A
  • common law tests -(signature and notice)
  • statutory rules (unfair contract terms act 1977 and the consumer rights act 2015)
40
Q

what is the Unfair Contract Terms Act (UCTA) 1977

A

UCTA applies in contracts made in the course of business.

Any clause which exempts liability for death or personal injury is void. For all other losses the clause is void unless reasonable.

41
Q

what is the Consumer Rights Act 2015

A

The Consumer Rights Act only applies in contracts between a business and a consumer (member of the public). It states that exclusion clauses in such contracts must be fair and expressed in plain language.

If the term is held to be unfair then the business will not be able to rely on it against the consumer, although, the consumer would still be able to rely on it against the business.

42
Q

what is a severable contract?

A

stage payments made throughout the contract
- each stage - separate contract

43
Q

in the event of a breach of contract, what is the purpose of damages?

A
  • to compensate the innocent party
  • to put the innocent party in the same position as if the contract had been carried out

Law (13 decks)

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