Chapter 9 Flashcards

1
Q

Ending a Contract

A

Principal methods of discharging a contract
- Performance
- Breach
- Agreement between the parties
- Frustration

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2
Q

Performance

A

Contractual obligations are discharged when each party
satisfactorily completes its part of the bargain

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3
Q

Substantial performance

A

condition is breached in some minor way and subject to a claim for the loss caused by the shortfall

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4
Q

Tender of performance

A

An offer or attempt to do what is required under a
contract
* One party is ready, willing, and able and attempts to perform but
performance is refused by other party

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5
Q

Breach

A

Failure of a breaching party to properly perform its
contractual obligations

Two ways to breach:
1. Improper or incomplete performance; or
2. Refusal to perform

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6
Q

Conditions

A

terms essential to substantial performance
- Where breached, victim relieved of obligations

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7
Q

Warranties

A

minor terms of contract
- Where breached, performance still required

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8
Q

Exemption Clauses

A

Attempt to significantly limit or eliminate liability

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9
Q

Fundamental Breach

A

A breach of a fundamental aspect of the contract that is not covered
by an exclusion clause

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10
Q

Discharge by Agreement

A

Contracts can be modified or ended by agreement

  • Bilateral or unilateral discharge
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11
Q

Bilateral Discharge

A

agreement by both sides to terminate the contract or to
disregard a term of the contract – both parties are relieved of
obligations and therefore there is consideration.

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12
Q

Unilateral Discharge

A

One party performs and allows the other to be relieved
of all or some obligations – may not be adequate
consideration and the contract may be enforceable.

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13
Q

Conditions precedent

A

contract is binding only if a pre-existing condition is met

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14
Q

Conditions subsequent

A

The contract ends when some event or condition takes place

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15
Q

A force majeure clause

A

spells out who bears the risk if certain events occur
- Consequences for catastrophic events

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16
Q

Frustration

A

An unexpected event (out of control of the parties) which:
1. Makes performance impossible
2. Changes the nature of the contract

17
Q

Frustration Test

A

Frustration does not occur when:
 There is a shared mistake
 When one party is responsible for an act that frustrates a contract (just a breach)

18
Q

Common Frustrating Events

A
  • Destruction of the subject matter
  • Cancellation of a critical event
  • Change of the relevant laws
19
Q

Krell v Henry

A

parties agreed to the rental of an apartment from which
the tenant could view the coronation of Edward VII. The coronation was postponed. It was still possible to occupy the flat, but to require the tenant to do so with no coronation parade to watch would be something essentially different from what the parties contracted for.

20
Q

Damages

A

Most common remedy for breach of contract is damages

  • In a breach of contract damages look forward in time
  • court asks what loss has been suffered by the plaintiff and compensates for those
    losses
  • Tort damages look backward
21
Q

Equitable Remedies

A

Equitable remedies are discretionary and will be granted only when
the judge thinks it right and fair to do so – special situations where
the ordinary remedy of damages would not be adequate.

22
Q

Recession

A

returning parties to their original position

23
Q

Rectification

A

court interprets and corrects wording of a document to
reflect agreement of parties

24
Q

Specific performance

A

Court orders defaulting party to perform its
obligations if damages are not suitable or adequate

25
Q

Injunction

A

an order to prevent a party from breaching a contract

26
Q

Accounting

A

court may order breaching party to disclose all financial
dealings and records and pay profits

27
Q

Quantum meruit

A

court may order payment for part performance