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Definition
| contracts containing conditions affecting the performance obligations of the parties |
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| three types of conditions affecting the obligations of the parties |
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| condition precedent, condition subsequent, condition concurrent |
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| a particular event (e.g. death) must occur in order for a party's duty (insurance company) to arise (insurance payments to beneficiary) |
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| the party has a duty to perform until a future event occurs that discharges the party from the obligation |
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| exist when the parties are to perform their obligations for each other simultaneously (e.g. buyer pays seller; seller has to deliver goods) |
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| explicitly stated in the contract; usually preceded y words such as "provided that", "if", or "when" |
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| conditions not explicitly stated in the contract; e.g. a builder will have access to the house (keys) |
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Definition
| when all aspects of the parties' duties under the contract are carried out perfectly |
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Definition
| 1) completion of nearly all the terms of the agreement; 2) an honest effort to complete all the terms, and 3) no willful departure from the terms of the agreement |
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Definition
| a party fails to perform her obligations under the contract |
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Definition
| discharges the non-breaching party from his obligations under the contract; occurs when a party unjustifiably fails to substantially perform his obligations under the contract |
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Definition
| when a contracting party decides not to complete the contract before the actual time of performance |
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| discharge by mutual agreement - 4 ways |
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Definition
| 1- mutual rescission; 2- substituted contract; 3- accord and satisfaction; 4- novation |
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Term
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Definition
| parties mutually agree to discharge each other from the contract |
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Term
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Definition
| substitute a new agreement in place of the original |
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Term
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Definition
| when on of the parties wishes to substitute a different performance for his or her original duty under the contract; accord- the new duty; satisfaction- the performance of the duty to satisfaction |
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Term
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Definition
| replace one of the parties with another party; original duties remain the same; all three parties must agree to the novation for it to be valid |
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| discharges by operation of law- 6 |
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Definition
| 1- alteration of contract; 2- bankruptcy; 3- tolling of statute of limitations; 4- impossibility; 5- commercial impracticability; 6- frustration of purpose |
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Term
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Definition
| material alteration of a written contract without the knowledge of the other party; innocent party can be discharged from contract |
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Term
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Definition
| when a party files bankruptcy, the court allocates the assets to creditors then issues the party a discharge in bankruptcy |
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| tolling of statute of limitations |
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Term
| impossibility of performance |
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Definition
| an unforeseen event occurs that makes it physically or legally impossible for a party to carry out the terms of the contract |
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Term
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Definition
| it is in fact not possible to lawfully carry out one's contractual obligations; discharges from contract |
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Term
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Definition
| it would be very difficult to carry out the contract; does not discharge from contract |
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Term
| three main situations of objective impossibility |
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Definition
1. destruction of subject matter
2. death or incapacity of a party whose persona services are necessary
3. subsequent illegality |
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Term
| commercial impracticability |
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Definition
| whe performance is still objectively possible BUT would be extraordinarily expensive or injurious to one party; due to an unforeseeable event |
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Term
| to claim commercial impracticability, must prove |
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Definition
1. that an event occurred whose non-occurrence was a basic assumption of the contract
2. That there is commercial impracticability of continued performance
3. that the party claiming discharge did not expressly or impliedly agree to performance in spite of impracticability that would otherwise justify nonperformance |
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