Performance

Question 1

What is a party’s basic duty to perform at common law?

Answer 1

substantially perform all that is called for in the contract

Question 2

What does Article 2 generally require of performance of a contract?

Answer 2

perfect tender - exactly as promised in the contract

Question 3

In a noncarrier case, what is a seller’s obligation of tender and delivery?

Answer 3

1. seller must hold conforming goods at the buyer’s disposal and give the buyer sufficient time to take possession AND must give buyer notice reasonably necessary to enable her to take possession at a reasonable hour
2. if the agreement doesn’t specify, delivery generally at seller’s place of business (or home)

Question 4

In a carrier case, where seller has entered into a shipment contract and has not agreed to tender at a particular destination, what is seller’s obligation of tender and delivery?

Answer 4

1. get the goods to a carrier and contract to send them to buyer
2. get and tender any docs necessary to enable the buyer to take possession; and
3. notify the buyer of the shipment

Question 5

In a carrier case, where the seller has entered into a destination contract and has agreed to tender at particular destination, what is seller’s obligation of tender and delivery?

Answer 5

hold conforming goods at the buyer’s disposal at the destination specified in the carrier destination contract

Question 6

In a noncarrier case, what is the buyer’s obligation to pay ?

Answer 6

sale is for cash due concurrently with tender of delivery

Question 7

In a carrier case, what is the buyer’s obligation to pay?

Answer 7

price is due only a the time and place at which the buyer receives the goods

Question 8

In an installment contract, what is the buyer’s obligation to pay?

Answer 8

seller may demand payment for each installment if the price can be so apportioned - unless a contrary intent appears

Question 9

What is the buyer of goods under the UCC’s right to inspect?

Answer 9

buyer has right to inspect before she pays unless the contract provides for payment C.O.D.

Question 10

Define “promise”?

Answer 10

a promise is a commitment to do or refrain from doing something - failure to perform is breach

Question 11

Define “condition”?

Answer 11

1. an event or sate of the world that must occur or fail to occur before a party has a duty to perform; or
2. an event or state of the world, the occurrence or nonoccurrence of which releases a party from his duty to perform

Question 12

What is the difference between a failure of a promise and the failure of a condition?

Answer 12

failure of promise = breach and liability

failure of condition = relives a party of the obligation to perform

Question 13

How does a court determine if a term is a “condition” or a “promise”?

Answer 13

look to the intent of the parties - words/phrases/prior practices/custom

“provided” “if” and “when” = condition
“promise” “agree” = promise

Question 14

What is a condition precedent?

Answer 14

one that must occur before an absolute duty of an immediate performance arises in the other party

Question 15

What is a condition concurrent?

Answer 15

those that are capable of occurring together, and that the parties are bound to perform at the same time (tender of deed for cash)

Question 16

What is a condition subsequent?

Answer 16

one that, when it occurs, cuts off an already existing absolute duty of performance

Question 17

What is an “express condition”?

Answer 17

express statement in a contract providing either:

1. a party doe not have to perform unless some event occurs or fails to occur; or
2. if some event occurs or fails to occur, the obligation of a party to perform one or more of his duties under the contract is suspended or terminated

Question 18

What is a ‘promisor’s satisfaction’ usually classified as - condition or promise?

Answer 18

express condition precedent - promisor is under no duty to pay unless she is satisfied

Question 19

If a contract involves mechanical fitness, utility, or marketability what is the standard used of a promisor’s satisfaction is necessary before payment?

Answer 19

a performance that would satisfy a reasonable person

Question 20

If a contract involves the personal taste or personal judgment of the promisor before payment - when is the condition satisfied?

Answer 20

fulfilled only if the promisor is personally satisfied (but must be in good faith)

Question 21

If a contract involves the satisfaction of a third party as a condition to payment, what standard is used?

Answer 21

the actual personal satisfaction of that person is necessary subject to honesty and good faith

Question 22

What is a constructive (implied) condition of performance?

Answer 22

duty of each party to render performance is conditioned on the other party either rendering his performance or making a tender of his performance

Question 23

What is a constructive condition of cooperation?

Answer 23

obligation of one party to render performance is impliedly conditioned on the other party’s cooperation in that performance

Question 24

What is a condition of notice?

Answer 24

generally where a party could not reasonably be expected to know a fact that triggered the duty ot perform unless such notice was given

Question 25

If both performances can be performed simultaneously - when must each party perform?

Answer 25

each party must first tender his own performance if he wants to sue the other

Question 26

If one performance will take substantially longer to complete and the other can be rendered in an instant - when must each party perform?

Answer 26

the completion of the longer performance is a constructive condition precedent to the execution of the shorter performance

Question 27

If a condition fails to occur or cannot occur, but one of the parties has fully or partially performed - can they recover damages?

Answer 27

Yes - generally under unjust enrichment theories - but it may be less than contract price

Question 28

List the ways a condition could be excused:

Answer 28

1. Hindrance or Failure to Cooperate
2. Actual Breach
3. Anticipatory Repudiation
4. Prospective Inability or Unwillingness to Perform
5. Substantial Performance
6. “Divisibility” of contract
7. Waiver or Estoppel
8. Impossibility, Impracticability, or Frustration