Rules Flashcards
(38 cards)
Substantial Performance
Almost perfect performance plus damages. Factors
- Extent injured deprived
- possible to compensate injured
- Extent failing party forfeiture.
- Likelihood failing party will cure.
- Did failing party acting in good faith and fair dealing
Insecurity common law
If party has reasonable ground to think other party will breach they may request an assurance.
Specific Performance
aims to force a party to perform on the contract. (disfavored by courts.)(only used of money damages are inadequate - real property, unique goods, limited edition corvette)
Warranties
- A promise/affirmation by seller to buy that is part of basis for bargain creates an express warranty and goods must conform to promise/affirmation.
- any description that becomes basis for bargain creates express warranty
- model/sample that is basis for bargain creates express warranty.
- seller does not need to use express words to create warranty
Anticipatory Repudiation
- Words or conduct that demonstrate that a party intends not to perform.
- repudiating party may retract if the other party has not materially changed their position in reliance on repudiation.
Natural Omissions Test
If a term would have been naturally omitted from a K, and it was, then the K is integrated.
No extrinsic evidence.
Terms that would be naturally omitted from K are not allowed.
Certain Conclusion Test
whether the parties certainly would have included the outside agreement, if they would have and did not, then the contract is fully integrated and the term is outside provision is barred
Waiver
If modification need to be in writing and is not made in writing, it can act as a waiver if made in goof faith and you can show reliance (Wisconsin Knife Works)
Reliance Damages
aim to put the party in the position they were in before contract formation. = costs incurred by reliance on contract. (oil stove at convention case)
Implied Conditions
1) When performances can be done SIMULTANEOUSLY they are due simlutaneously unless explicitly stated. When peformance takes a period of time to perform, that party’s performance is required first.
2) Payment is due at the END of performance (work before pay)
Parole Evidence - Common Law
- Was the outside agreement related to the written contract? Yes
- does the outside agreement contradict the written term(s)? No
a. Opposite (not ok) vs lesser effects (ok)(Hunts)
b. Absence of reasonable harmony (AND) - is the agreement integrated? No
a. Merger Provision
b. Natural omission test
Conditions
224- a condition is an event not certain to occur which must occur before performance becomes due
225- performance subject to a condition becomes due when the condition occurs
Impracticability
- Unanticipated(unforeseen)
- Basic assumption
- Risk allocated
- Contract
- Limited knowledge
- Ct. allocated
- Undue Burden
Bilateral Mistake (mutual)
Mistake by both parties
- to basic assumption (subject matter of K)
- has material effect.
- Adversly affected does not bear risk.
- Contract
- Limited knowledge
- Ct. allocated
Novation
Novation is the substitution of a new obligation for an existing one and is done by agreement, with the intent to extinguish the old obligation. Novation is made by contract and is subject to all the rules of contract formation.
Explicit
- Obligor assents to the novation and words in the contract must explicitly release the original obligee
Implicit
- Actions demonstrate a new agreement with new obligee like negotiations without the original obligee
Seller Remedies under UCC in general
When buyer cancels K or rejects delivery a seller may:
- withhold delivery
- stop further delivery under
- resell and recover damages (2-706)
- recover damages for non-acceptance (2-708)
Interpretation
Generally a merger clause means K is final expression of intent and agreement
- courts can use course of dealing and circumstances surrounding K formation to determine common basis of understanding in order to interpret K.
Express Conditions
Established by using words to indicate. eg. It shall be an epress condition that____ the consequences of failure to perform are____
Excuse
Set of rules that allow parties to be excused from a contract.
mistake, impossibility, impracticability, frustration.
Material Breach
When a party is deprived of the benefit they reasonably expected. It is a condition to parties remaining duties that there be no uncured material breach by the other party.
UCC sellers resell
Seller may resell goods. If done so in good faith and commercially reasonable manner damages = K price - resell price + incidentals - savings. If sale is done private notice must be given to original buyer. If no notice then seller can only collect incidentals
Limitations
Limitations to damages:
- 1) Foresee-ability- natural and probable consequences of the breach
2) Certainty- calculable with reasonable degree of certainty
3) Mitigation- non-breaching party must take steps to decrease damages.
Expectation Damages
aim to put the party in the position they would have been in if contract was performed. Profit margin + reasonable costs.
Merger
A merger clause signifies that the parties intend the contract to be the final expression of the agreement. Parole evidence rule applies. Extrinsic evidence ok only to interpret terms. (garden state)
