UCC Modification + Excuse of Performance Flashcards
Modification + Excuse of Performance
By Agreement Between Parties
Under the UCC, a contract modification made in good faith is enforceable without new consideration.
* Bad Faith - if modification obtained in bad faith, then unenforceable.
* SoF - if modified k falls within SoF, then must meet SoF req’s but exceptions apply.
* Prohibition of Oral Modification - if one or fewer merchants, provision requiring all modifications occur in writing is valid; if both merchants, then requirement must be signed by both parties.
* Waiver - DOES NOT MAKE SENSE
Modification + Excuse of Performance
By Operation of Law
Destruction + Damage; Method of Transporation
- Destruction/Injury to Goods
Underthe UCC, if the goods are destroyed without fault to either party before risk of loss passes to buyer, then the contract is avoided (neither party breached nor must peform).
Under the UCC, if the goods are damaged without fault to either party before risk of loss passes to buyer, then the contract is avoided unless the buyer chooses to take the goods at a reduced price.
Under the UCC, if the goods are damaged or destroyed and the risk of loss has passed to the buyer, then the seller may demand performance by the buyer.
- Failure of Agreed Upon Transportation Method
Under the UCC, if the agreed upon transportation method becomes impracticable/unavailable, then any commercially reasonable delivery method must be accepted.
Modification + Excuse of Performance
By Operation of Law
Impracticability
Commercial; Event Presumed; Other; Failure of Source
Under the UCC, when seller’s performance becomes commercially impracticable, seller’s obligations may be discharged.
* I TOTALLY MADE THIS UP, THE BOOK SUCKS
Under the UCC, when both parties impliedly assumed a circumstance would not occur, such circumstance arises, and such circumstance materailly effects the seller’s ability to perform, then the seller’s obligations may be discharged.
* Unforseeable - bad weather not enough; bad storm or bad snow storm, no; tornado or avalanche, yes. must be unforseeable.
Other - natural disasters, war, trade and military embargo, strikes, local crop failure
Under the UCC, if the agreement requires a specific source of supply be used and said souce fails, then performance is discharged.
Modification + Excuse of Performance
By Operation of Law
Seller Partial Inability to Perform
Under the UCC, if seller is partially unable to perform due to a deficiency in supply, then seller must allocate the available supply among its customers in a fair and reasonable manner and must notify buyer that there will be a delay/nondelivery/allocation.
Modification + Excuse of Performance
Prospective Inability to Perform
Under the UCC, if a party has reasonably grounds for insecurity with respect to the performance of the other party, then the fearing party may demand adequate assurances in writing and while waiting, may suspend performance if commercially reasonable.
* Not Provided - if adequate assurance is not received within a reasonble time not exceeding 30 days, then considered a repudiation.
* Adeqaute Assurance - dependent on facts; between merchants, then commercial standards.
* Performance Begun - acceptance of improper delivery/payment does not preclude party from demanding adequate assurance.
Modification + Excuse of Performance
Anticipatory Repudiation
Under the UCC, if a party unequivocally states their unwillingness to perform, and the repudiation substantially impairs the value of the contract, then the aggrieved party may await performance for a reasonable time or seek remedies under Article 2 (performance is excuse).
* Substantially Impair Value - if aggreieved parrty materially inconvenience if forced to wait and not receieve tender.
* Retraction - if repudiating party’s next performance has not passed, and aggrieved party has not cancelled the contract nor materially changed position, then repudiating party may retract their repudiation
