Material Breach Flashcards
(9 cards)
1
Q
Elements of Material Breach
A
- Any non-performance of a contract duty (obligation, responsibility)
- At a time when performance is due
2
Q
Characteristics of Material Breach
A
Characteristics
1. Failure/refusal to perform contract duties
2. Failure to properly perform contract duties (can still breach if not performed in the proper way)
3. Performance is not due if the non-performance is justified
3
Q
Two types of breach
A
- Total Breach
- Partial Breach
4
Q
Total Breach aka Material Breach
A
- Breach is severe, material
- Allows the non-breaching party to sue immediately
5
Q
Anticipatory Repudiation Definition
A
- A party notifies the other party before the date of performance that the party will not perform
- This notice repudiates (terminates) the contract
- This notice discharges (excuses) the non-breaching party from the duty to perform
- The non-breaching party can sue for breach immediately, or, can wait until the date of performance, then sue for breach
6
Q
Characteristics of Anticipatory Repudiation
A
- The notice can be given orally, in writing,
- can be shown by conduct which shows an unwillingness to perform, or
- can be shown by “reasonable grounds for insecurity” (e.g., serious financial problems, shortage of materials)
- If the notice merely expresses “doubt” as to performance, doubt alone is insufficient to show anticipatory repudiation
- “Grudging” willingness to perform is insufficient
- Repudiation must be made to the promisee, not to a third party
7
Q
Breach Materiality Factors
A
- deprivation of expected benefits
- adequacy of compensation for the loss
- past performance/preparation to perform
- likelihood breach will be cured
- willfulness of breach
- balancing of hardships
8
Q
Reliance Factors
A
- Has the non-breaching party sued the breaching party?
- Has the non-breaching party materially changed its position?
- Has the non-breaching party indicated that the AR is final?
9
Q
Partial Breach
A
Breach is not material
Does not relieve the non-breaching party from performance
Non-breaching party can immediately sue for damages from the partial breach
