D Flashcards
(45 cards)
Cutter v Powell (1795)
Judgment: As the contract was for the whole voyage, he had not performed his contract by dying part way through!
Re Moore and Co. Ltd and Landauer and Co’s Arbitration (1921)
Judgment: Total number of tinned peaches was correct, but the number of tins in each carton was incorrect so the goods did not correspond with the description in the contract.
Divisible contracts
Where a contract has separate parts, non-completion of one part is not a breach of the whole contract.
Ritchie v Atkinson (1808)
Judgment: The ship owner was entitled to be paid for the part of the cargo he had carried as the contract was divisible i.e. whole contract not breached.
Substantial performance
The doctrine of substantial performance may apply if a party has done substantially what was required under the contract.
If applicable, payment of the amount appropropriate to what has been done.
Often occurs in larger contracts where little things are not performed as exactly as expected.
Dakin and Co. v Lee (1916)
Judgment: Substantial performance applied as there were relatively minor defects in the builder’s work.
How is it decided what is substantial performance
Decided case by case as to what constitutes substantial performance.
See Hoenig v Isaacs (1952) -
Quantum meruit - as much as it is worth.
Bolton v Mahadeva (1972)
£170 repair for £560 worth of work deemed not to be substantial performance.
Prevention of full performance
If one party prevents the other from carrying out his contract, then the innocent party can claim to be paid on a quantum meruit basis.
Planche v Colburn
Judgment: An author was prevented from carrying out his contract so was paid on a quantum meruit basis.
Acceptance of part-performance
If one party has agreed the other party need not complete the entire contract then the contract must be paid for on a quantum meruit basis.
The consent must be:
A specific acknowledgement that the defaulting party is entitled to be paid for what has been completed so far;
agreement made without undue pressure.
If innocent party has no option but to take the benefit of the work done, not considered as consent to part-performance
Sumpter v Hedges (1898)
Judgement: The builder was not entitled to be paid for the work he had done so far as the customer had no alternative but to complete the work himself. He had not consented to the builder’s part performance.
The effect of a term as to time for performance
Courts regard time as a condition if:
the parties have expressly stated in the contract that time is of the essence of the contract i.e. timing critical for contract to be fulfilled as intended;
in the circumstances time for the completion of the contract is critical, or
one party has failed to perform on time and the other has insisted on a new date for completion of the contract (making time of the essence of the contract).
If none of the above apply, then the time for performance is treated as a warranty.
See Charles Rickards Ltd v Oppenheim (1950)
Judgment: The buyer of the Rolls-Royce was entitled to cancel the contract as time had been made of the essence and that term had not been complied with.
The effect of a term as to time for performance
See Union Eagle Ltd v Golden Achievement Ltd (1997)
Judgment: The time for the completion of the contract had been specified as 5pm and time was expressly stated to be ‘of the essence’. The purchaser delivered the purchase price at 5.10pm and the seller was entitled to repudiate the contract.
Time and the Consumer Rights Act 2015
S52 - if contract does not expressly fix time for service to be performed, the contract is to be treated as including a term that the trader must perform the service within a reasonable time.
If a trader in breach of s52, the consumer has a right to a price reduction under s54. Refund could be anything up to full contract price.
Discharge by breach
Actual breach
Three sets of circumstances giving rise to a breach of contract:
renunciation by a party of his or her liabilities under it e.g. not paying a bill on the due date;
impossibility created by his/her own act e.g. closing a hairdresser’s business for holidays with appointments during that time;
total/partial failure of performance e.g. delivering defective goods.
Repudiatory breach
This occurs when a party commits a breach of contract that is sufficiently serious that it entitles the innocent party to treat the contract as terminated.
Can occur in three ways:
a breach of a condition;
a refusal to perform the contract;
a sufficiently serious breach of an innominate term i.e. a breach that would be considered to be a breach of a condition.
Outcome: Party not in breach can either terminate the contract and claim damages or continue the contract and claim damages.
Anticipatory breach
Occurs when a party to a contract gives notice in advance to the other party that he or she will not be performing/completing contract.
Innocent party has a choice to either:
sue immediately for a breach of condition; or
wait for the time agreed for the performance of the contract and sue if performance does not take place then.
Outcome: innocent party can treat the contract as repudiated immediately and/or claim damages.
See Hochester v de la Tour (1853)
Where one party communicates their intention not to perform the contract, the innocent party need not wait until the breach has occurred before bringing their claim. They may sue immediately or they can choose to continue with the contract and wait for the breach to occur.
Geden Operations Ltd v Drybulk Handy Holdings Inc (Bulk Uruguay) (2014)
suggestion by one party that obligation will not be fulfilled and other party can subsequently come to a reasonable conclusion about intention can amount to a repudiation of contract.
Frustration
when a party to a contract was prevented from keeping the promise because of an unforeseeable, intervening event, he or she would not be liable for a breach of contract.
See Taylor v Caldwell (1863)
Judgment: The destruction of the music hall by fire was not the fault of either party so the contract was frustrated.
