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Question 1

What is impossibility of a condition?

Answer 1

This excuses fulfilment if the condition is not a material part of exchange. If it is, then forfeiture results

Question 2

What is an example of impossibility of condition?

Answer 2

If an insurance company says you have to give notice within two weeks after an accident, but you are in a coma for three weeks, that makes the two-week requirement impossible, and since it isn’t a material part of the exchange, the condition is excused and you have a claim

Question 3

If non-fulfillment of a condition will cause a disproportionate forfeiture, what usually happens?

Answer 3

Fulfillment is excused unless it was a material part of the exchange

Question 4

If you have a contract with a settlement company to send your goods, and if there is damage you must give notice of written loss within 10 days after arrival. Your goods get damaged and the company knows it, you note on delivery that there was damage and call them on the phone, but don’t give written notice until 25 days later. What happens?

Answer 4

The purpose of the written notice was to tell the company so they could investigate, and they got notice by the oral claim, so the court will excuse the non-occurrence (to avoid a forfeiture).

Question 5

What are the four ways a condition can be excused?

Answer 5

• a party prevents fulfilment
• a party waives it
• impossibility
• disproportionate forfeiture

Question 6

What is breach?

Answer 6

Party fails to perform a contractual obligation

Question 7

An actual breach at the time performance is due always allows what?

Answer 7

An immediate cause of action for damages

Question 8

Does every breach excuse the other party’s duty to perform?

Answer 8

No, it depends on how major or minor the breach is

Question 9

What are two ways to breach of contract?

Answer 9

• prevention of a condition

- anticipatory repudiation

Question 10

What is the reason that the party is not allowed to do anything to prevent the condition from occurring?

Answer 10

Because every contract has an implied duty to act in good faith, so if the party doesn’t, that excuses the condition and the party has an absolute duty to perform

Question 11

What are the two ways that prevention of condition can happen?

Answer 11

Hindering the condition or by inaction

Question 12

What is an example of prevention of a condition resulting in breach because of inaction?

Answer 12

Agreeing to buy a home conditioned on your ability to get a loan, but if the person didn’t apply for a loan, that makes his duty to pay absolute because of his failure to use good faith

Question 13

What is anticipatory repudiation?

Answer 13

When both parties still have duties to perform, words/conduct by one party that clearly shows he will not perform or doing something that precludes him from performing excuses the condition

Question 14

What is the reasoning that anticipated repudiation excuses the condition?

Answer 14

Because forcing the innocent party to remain in readiness is unfair

Question 15

If you do/say something that makes it doubtful you will perform, is that anticipatory repudiation?

Answer 15

No

Question 16

When can you request an adequate assurance of performance?

Answer 16

If you are worried because the other party does something that makes it doubtful or unlikely they will perform

Question 17

What happens if you request an adequate assurance of performance, and no response is given?

Answer 17

You can treat it as an anticipatory repudiation

Question 18

What are some facts to help decide if a breach is major or minor?

Answer 18

• extent the breaching party has performed
• if it was willful, negligent, or innocent
• how much benefit the non-breaching party will get of what he bargained for
• extent the non-breaching party can be adequately compensated by damages
• the degree of hardship on the breaching party if the breach was material
• if it involves things specially mentioned in the contract as important

Question 19

If a breach happens at the beginning, is it likely material or not?

Answer 19

Material

Question 20

If a breach is willful is it likely material or not?

Answer 20

Material

Question 21

If time, manner, or other important performance details are deviated from, is that likely material or not?

Answer 21

Material

Question 22

If you promise to pay someone to paint your house by a certain date because a wedding is happening shortly after, would delay be material or nonmaterial?

Answer 22

Material

Question 23

What is a minor breach?

Answer 23

If there has been substantial performance, it doesn’t cancel the contract, but just justifies an action for partial breach, which is a minor breach

Question 24

If a material breach has happened, what are the options?

Answer 24

• can choose to cancel the contract, or

- elect to continue and sue for partial breach

Question 25

Is failing to finish a “time is of the essence” contract by the deadline considered material?

Answer 25

Yes, but the owner can allow the contractor to finish within a reasonable time from election and must pay the price, but can get damages for partial breach

Question 26

Under the UCC if there has been a breach, but the buyer accepts the goods, what must he do?

Answer 26

Give notice of the breach or be barred from any remedy (and if seller is aware of breach because must notify him of potential litigation and it gives him opportunity to cure)

Question 27

Must you give a reason for rejecting performance?

Answer 27

No, but if you do and you don’t state all of the reasons, you are a stopped from asserting the unstated ones later if the other party injuriously relied on the ones you gave

Question 28

What is estoppel?

Answer 28

When one party changes position as a result of an act of the other party, must be shown by clear and convincing evidence

Question 29

When does estoppel apply?

Answer 29

• when a party misrepresents facts,
• the other party justifiably relies on the facts
• to his detriment