Excuse of Nonperformance of K b/c something occurred after it was formed Flashcards Preview

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P contracts to paint O's house on Saturday for $1000. P does not paint. Does O have to pay?

No. Excuse of performance because of the other guy's nonperformance.


What is anticipatory repudiation?

An unambiguous statement or conduct (i) that the repudiating party will not perform (ii) made prior to the time that performance was due.


Does anticipatory repudiation excuse the other from performing?



P contracts to paint O’s house with payment to be made on July 13. On March
10, before P has finished painting, O tells P that she is doing a great job but that
O is not going to pay. Is P excused from continuing to perform?

Yes. Unambiguous statement that repudiating party will not pay and it was made prior to July 13.


When can you recover for anticipatory repudiation?

Generally immediately can make claim for damages for breach, unless the claimant has already finished her performance.


How can you retract anticipatory repudiation?

It can be withdrawn (retracted) so long as there has not been a material change in position by the other party. If the repudiation is timely retracted, the duty to perform is reimposed but performance can be delayed until adequate assurance is provided.


What if performance by another is uncertain?

Typically in sale of goods contracts. If the party gives reasonable grounds for insecurity it can make a written demand for adequate assurance and it can suspend performance if it is commercially reasonable until such assurance is made.


Just recall article 2 perfect tender rule.

Applies to sale of goods only.


What is the material breach rule?

It is common law. Damages can be recovered for any breach. A material breach by one guy excuses the other from performing.


IS a breach material if there was a substantial performance?



If the breach is material, is the performance not substantial?



O hires P to paint his house white for $1,000. P, a big fan of the group Gogol
Bordello, http://www.youtube.com/watch?v=p_81l4DXlwM paints the house
purple. Did P materially breach? Is O excused?

Yes, material breach. O is excused. O can recover


When is a breach material in quantity of performance cases?

Must be substantial.


P contracts to paint ten identical apartments for O for $10,000. P breaches after
painting two apartments. Was P’s breach a material breach? Is O obligated to pay?

Material Breach, O not obligated to pay under contract law. May have claim under quasi-contract.


What is the divisible contract corollary?

If a contract is divisible, i.e. paint 10 houses $100 per house, there can be a contract law recovery for substantial performance of a divisible part even though there has been a material breach of the entire contract.


What is an express condition and how can they be identified?

Language in contract, limits obligations created by other contract language, triggering words (if, only if, provided that, so long as, subject to, etc.)


S and B enter into an agreement that states that B will
buy and S will sell S’s house for $100,000 “on the condition that a mortgage at no
more than 6% can be obtained.” Is there a contract?

Yes, they entered into an agreement to the $100,000 on the condition that a mortgage at no more than 6% can be obtained. If B cannot get a mortgage under that rate he is excused.


What is the standard for determining whether an express condition has occurred? I.e. been satisfied.

Generally strict compliance is required for satisfaction.


B contracts to buy a diamond pupik ring from S. The contract states, “This sale is
subject to the ring’s being appraised at $20,000.” If the ring is appraised at
$19,500, is B excused from any contract obligation to buy the ring?

Yes, no strict compliance.


B contracts to build O’s house. The contract states, “O’s payment for B’s work is
conditioned on B’s using only copper Reading pipe.” B instead uses comparable
copper Cohoe pipe. Is O excused from any contract law obligation to pay B?

Yes, the condition was express for Reading pipe not Cohoe.


What is the exception to the general rule that strict compliance is required to satisfy an express condition?

Condition of personal satisfaction of one of the parties--honest and good faith dissatisfaction. If there is language about personal satisfaction, strict compliance need not be met, courts simply look to whether a reasonable person would be satisfied.


How can an express condition be eliminated so that its nonoccurence does not affect performance obligations?

Waiver: identify the person who beneifts from or is protected by the express condition, look for a statement by that person giving up the benefits.



What is the difference between conditions precedent and conditions subsequent?

Almost all contract provisions are conditions precedent. Conditions that excuse performance until and unless they occur.
Condition subsequents occur subsequent to the start of performance and excuse performance when they occur.


Do condition subsequents create new performance obligations?

No they, like conditions precedent, limit performance obligations otherwise created.


Spike Lee contracts to see you his New York Knicks courtside seats for $10 a
game so long as the Knicks are not in first place. The Knicks are now in second
place. Mr. Lee wants to stop selling you his tickets. Is Mr. Lee excused from

Strict compliance---condition was first place, so he is not excused.


What is a rescission?

A later deal to excuse performance of the first agreement.


contracts to paint O’s house for $1,000, with payment to be made when the
work is completed. P begins work. Before P completes the work, P and O agree
to rescind the contract. Is the rescission valid?

Yes, no one can recover, everyone is excused.


Can rescission occur after performance?



On the bar exam what will accord questions look like?

They will havean agreement by the parties to an already existing obligation to accept a different performance in satisfaction of the existing obligation.


What is the effect of accord and satisfaction?

if the new agreement (the accord) is performed (satisfaction), then performance of the original obligation is excused.