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Flashcards in Termination of contract Deck (14):
1

What are the reasons for discharge of a contract?

- by performance
- by frustration
- by breach

2

Describe how a contract may be discharged by performance?

- when the duties of the contract are fulfilled
- these should be complete and exact
- courts may accept substantial performances

3

Describe how a contract may be discharged by frustration?

When forces outside the contract make performance impossible

4

Describe how a contract may be discharged by a breach?

- contractual duties not properly performed
- actual breach - at time of contract
- anticipatory breach - before time performance is due

5

What are the two types of remedies for discharges of contract?

- damages - available as a right to the injured party
- equitable remedies - available at discretion of the court

6

What are the 3 types of damages?

- liquidated damages
- penalty clause
- unliquidated damages

7

Describe liquidated damages

Genuine attempt to pre-estimate losses

8

Describe penalty clause

Excessive or arbitrary amount in contract - not enforceable

9

Describe unliquidated damages

The court must decide the value
- remoteness - only award for losses which are natural or in both parties contemplation
- measure of loss
- expectation interest - what position did the claimant expect to be in?
- reliance interest - what has the claimant lost out on by on the contract being performed
- parties have a duty to mitigate their losses

10

Describe the types of equitable remedies

- specific performance
- rescission
- injunction - mandatory, prohibitory, asset-freezing

11

What are exclusion clauses?

Terms included in written contract to limit or exclude liability

12

What 2 tests must exclusion clauses pass to be valid?

- common law tests
- statutory rules

13

Describe the common law test

- must be incorporated - by signature or by bringing the exclusion clause to the attention of the other party at/before the time of agreement
- wording will be interpreted against the person trying to rely on them

14

What are the statutory rules?

- unfair contract terms act - in all contracts except those specifically excluded
- consumer rights act - in contracts where one party is a consumer