Performance & Breach

Question 1

What are the three ways a valid contract can be discharged?

Answer 1

1 Performance
2 Breach
3 Frustration

Question 2

What is the general rule for performance of a contract?

Answer 2

Performance must be complete and exact.

Question 3

Which case established the rule of complete performance?

Answer 3

Cutter v Powell – sailor died before completing voyage; no payment.

Question 4

What are divisible contracts?

Answer 4

Contracts divided into units where payment is due for each completed unit.

Question 5

Case for divisible contracts?

Answer 5

Ritchie v Atkinson – contract paid per unit delivered.

Question 6

What is substantial performance?

Answer 6

When a party completes most of the contract but with minor defects.

Question 7

Case showing substantial performance allowed?

Answer 7

Hoenig v Isaacs – £55 defects deducted from price.

Question 8

Case showing performance not substantial?

Answer 8

Bolton v Mahadeva – central heating only 70% effective.

Question 9

What is prevention of full performance?

Answer 9

When one party prevents the other from completing the contract.

Question 10

Case for prevention of full performance?

Answer 10

Planche v Colburn – author stopped from finishing book.

Question 11

What is acceptance of partial performance?

Answer 11

When the other party voluntarily accepts incomplete work and must pay for it.

Question 12

Case for acceptance of partial performance?

Answer 12

Sumpter v Hedges – partial building work accepted.

Question 13

What is the general rule about timing of performance?

Answer 13

Timing is usually an innominate term.

Question 14

When can time become ‘of the essence’?

Answer 14

1 Contract expressly states it
2 Notice is given
3 Circumstances show time is essential.

Question 15

Case showing time expressly stated as essential?

Answer 15

Union Eagle v Golden Achievement – late completion invalid.

Question 16

What happens if a condition is breached?

Answer 16

Contract can be repudiated + damages.

Question 17

Case for breach of condition?

Answer 17

Poussard v Spiers & Pond.

Question 18

What happens if a warranty is breached?

Answer 18

Only damages available.

Question 19

Case for breach of warranty?

Answer 19

Bettini v Gye.

Question 20

What happens when an innominate term is breached?

Answer 20

Depends on seriousness of the breach.

Question 21

Case for innominate terms?

Answer 21

Hong Kong Fir Shipping.

Question 22

What are the two types of breach?

Answer 22

Actual breach and anticipatory breach.

Question 23

What is anticipatory breach?

Answer 23

When a party indicates before performance that they will not perform.

Question 24

Case for anticipatory breach?

Answer 24

Hochster v De La Tour – tour guide dismissed early.

Question 25

What options does the victim have after anticipatory breach?

Answer 25

1 Sue immediately 2 Wait until non-performance.

Question 26

What is actual breach?

Answer 26

When a party fails to perform their contractual obligations.