Contract Performance/Excuse Flashcards
(12 cards)
Identify 3 excuses to performance want to consider?
Impossibility, impracticability, frustration of purpose
What is impossibility?
A supervening obstacle that makes contract performance impossible.
What are elements of impossibility?
a) circumstances affecting contract have changed; b) change is not the fault of the defendant/due to act of defendant; c) change in circumstances makes performance impossible for defendant.
What is the standard for assessing impossibility?
Objective. Duty must be incapable of being performed by anyone. Defendant’s subjective inability to perform is not sufficient.
What are examples of circumstances that may result in impossibility?
Change in legal landscape – the activity is now illegal. Destruction of the subject matter of the contract. Death of one of the parties (in a personal services contract). Destruction of building in a repair contract. Not necessarily destruction of building in a building contract.
What is impracticability?
Performance is technically possible, but a change in circumstances means performance will cause an undue hardship for the defendant.
What are the elements of impracticability?
Circumstances affecting the contract have changed. Change not the result of any act of the defendant. Change in circumstances will cause defendant undue hardship.
With respect to impracticability, what is the standard for assessing whether the circumstances are sufficient?
Must not have been foreseen or be reasonably foreseeable by either side of the contract at formation. (For example, a farmer should reasonably foresee certain impediments of performance like drought, pests, certain diseases, etc.) Great increase in expense is not always sufficient to establish undue hardship.
What is frustration of purpose?
Has basically been subsumed in other two doctrines, but can still discuss independently. Basically, has the subject matter of the contract been completely destroyed? Focus is on economic value. Circ. must be unforeseen. (Eg, Contract to have someone build stadium for olympics. Olympics canceled due to World War.)
What is waiver?
Waiver occurs when a party indicates through words or actions that it will not insist on the enforcement of a specific condition.
What is the effect of a waiver?
The waiving party can no longer insist on the application of that condition.
When you are dealing with a serious issue of excuse, what do you need to do in essay?
Regardless of whether find excuse or not, need to consider it in the damages section, either way. For example, if excused, then excused party entitled to expectation damages.
