Performance Flashcards
(37 cards)
Performance issues
SPWCEA - Stevie Plays With Cats Every Afternoon
S - Substantial performance v. Perfect tender? P - Parol evidence rule? W - Warranties? C - Conditions? E - Excuses? A - Anticipatory repudiation?
Substantial performance vs. Perfect tender
Common law vs. UCC
What do courts consider when determining whether there is a breach?
CL = Substantial performance. Material breach = performance discharged. Courts consider:
Benefit lost to nonbreaching party (NBP) Adequacy of compensation for NBP's loss Cure likelihood Extent of forfeiture by BP if BP is denied BoB R2 §241
Warranties - type, disclaimer, recovery upon breach
Warranties = representation of “quality”
EW = basis of bargain (sample, affirmation)
Difficult to disclaim
§2-313
IW = MERCHANT, fit for commercial purpose
Disclaim conspicuous writing / Orally “merchantable”
§2-314
IWFPP = NOT just merchant, knowledge of B’s use
Disclaim IN WRITING conspicuous (“as-is”)
Recovery = Value as warranted - as accepted
Anticipatory repudiation
Definition
UCC vs. common law
What are P’s options?
By when may D retract under UCC?
Unequivocal communication of refusal to perform.
CL = unequivocal
UCC = unequivocal OR failing to assure when reasonably requested (<30 days)
Breach of K, suspend performance, discharge duty, ignore (mitigation)
D may retract before P materially alters position
§609
Condition
Definition
Promissory vs. pure condition
Satisfactory condition - traditional vs. modern
Party can either enforce or ______?
Once party relies on ______, what happens?
CONDITION is an event which is uncertain to occur, upon which duty of one of the parties depends
Nonoccurrence of a promise = BREACH
Nonoccurrence of a condition (NOC) = DISCHARGE OF PERFORMANCE
R2 §§225 (NOC)
R2 §246 (acceptance excusing NOC)
Satisfaction - subjective (traditional) / reasonable person (modern)
Types:
Waiver (words, conduct or written) - estopped from revoking waiver
Excuses
Definition
What are the 3 types?
Defense which exempts from a condition due to unforeseen circumstances.
Impracticable or impossible (nonoccurrence of a cond. is basic assumption on which K is made) (e.g., illegality, warehouse fire)
§261
Frustration of purpose - unforeseeable, not impossible, P not at fault (ticket for concert, headliner sick)
Precedent (prior), concurrent (same time), subsequent (discharges performance)
When conditions are not satisfied, performance may be excused unless a U-WEEP exception applies
U-WEEP
U - Untimely specifications W - Waiver E - Estoppel E - Excessive forfeiture P - Prevention
Parol Evidence Rule
Types of Ks relevant to PER and explanation
Extrinsic evidence prior or concurrent with K generally inadmissible.
Fully Integrated - complete and final agreement (look for complete/final agreement and MERGER clause) - EE cannot add OR contradict
R2 §213 / UCC §2-202
Partially - final but incomplete - EE can add but NOT contradict
Parol (extrinsic) evidence can be used to:
Establish the FACCS
F - Formation defects A - Ambiguities C - Conditions precedent C - Collateral agreements S - Subsequent modifications
Parol evidence - interpreting ambiguity - weight given to performance, dealing and trade usage
Course of performance > course of dealing > trade usage
Look at # of syllables
5 > 4 > 3
Parol evidence rule - definition
Extrinsic evidence to a contract offered to vary, supplement or explain K’s written terms.
Parol evidence - course of performance vs. course of dealing - When do they occur?
Course of performance - occurs after the K made.
Course of dealing - occurs before K made.
Condition - definition
- Uncertain event
- Must occur before
- Duty to perform arises
Effects of promissory vs. pure conditions on Ks
Nonoccurrence of a promise = BREACH
Nonoccurrence of a condition (NOC) = DISCHARGE OF PERFORMANCE
Waiver
knowing, voluntary, unilateral abandonment of a right
Satisfaction clause - Can a party’s subjective satisfaction determine whether a condition is met?
Yes, but if not specified in K, courts will apply reasonableness standard and my use trade standards or another objective benchmark.
Disproportionate forfeiture elements
MRL - it would be IMmoRaL to hold the party responsible for nonoccurrence of a condition when:
- M - Condition not MATERIAL
- R - Obligee substantially relied
- L - Obligee’s loss»_space; if condition enforced
How may a merchant disclaim merchantability? 3 ways.
- As-is/with all faults - WRITING
- Using “merchantability” or a variant - ORAL
- Buyer refuses to inspect
NO OTHER METHODS
Requirements to revoke acceptance of goods under the UCC?
- Reasonable expectation of seller’s cure
- Seller assures conformity
- Difficulty in discovering nonconformity
In a contract for the sale of goods delivered by carrier, when does the risk of loss pass to the buyer if no destination is specified?
No destination specified = delivered to carrier
Destination specified = tenders delivery
What 3 types of events will constitute the excuse of impossibility?
When D has another _______, performance be excused.
On what standard is impossibly judged?
- Death or incapacity
- Destruction
- Law
Destruction only if risk not assumed.
When D has another contractual obligation which conflicts, such as destruction of subject matter causing delay, then courts will allow impossibility excuse.
Impracticability - elements
UBDCR
- U - Unforeseen circumstances
- B - Nonoccurrence of condition was Basic assumption of K
- D - Performance difficult
- C - Party didn’t cause event
- R Party did not bear risk of event
Purpose substantially frustrated if
Performance has become virtually worthless.
Frustration of purpose - elements
Because frustrated, VARU became virtually worthless.
- V - Performance Virtually worthless
- R - Risks not assumed
- A Basic Assumption on which K was made
- U - Unforeseen circumstances
“Frustration of purpose” excuses performance of a duty IF:
* the purpose or value of the contract, * which the parties knewwhen they entered into the contract, * has been completely or almost completely destroyed * by asupervening actor event not foreseenor caused by the parties.
