What are some of the ways a contract can be brought to an end?
- Through Performance - completed
- Through Agreement - agree to end
- Through Frustration - Unforeseen event
- Through Breach - releases innocent party
Define the termination through performance.
- Performance is completed when all implied and express promises have been fulfilled.
- Doesn't necessarily end the relationship.
- May continue to do business - new, continuing or overlapping contracts.
Define the termination through agreement.
- Parties voluntarily bring the contract to an end.
- May agree to enter into a whole new contract.
- Ends the contract.
What is Substituting a Party?
Transferring one party's rights and obligations to someone else; a limited form of novation.
What is Novation?
The substitute of parties in a contract or the replacement of one contract with another.
What is the Assignment of a Contract?
- The transfer of a right by an assignor to an assignee.
- A creditor (the assignor) may assign the right to collect to another person (the assignee) without the agreement of the debtor.
- To be effective, the debtor must have notice of the assignment so that she knows to pay the assignee rather than the creditor.
Define the termination through frustration.
- Termination of a contract by an unexpected event or change that makes performance functionally impossible or illegal.
- Functionally impossible - a disaster
- Illegal - laws may have changed
- Neither side is liable to the other for breach.
In order to terminate by frustration, one must establish?
- Event was dramatic and unforeseen
- Neither party had assumed risk of the matter occurring
- Event arose without being either party's fault
- Performance functionally impossible or illegal
What is the Balance of Probabilities?
Proof that there is a better than 50% chance that the circumstances of a contract are as the plaintiff contends.
To prove a breach of contract, a plaintiff must demonstrate beyond the balance of probabilities that?
- 1. There is a contract between the parties
- 2. There is a breach of contract
- 3. There is an entitlement to a rememdy
Define a Condition.
An important term, which, if breached, gives the innocent party the right to terminate the contract and claim damages.
In terms of Breach of Contract, define Warranty.
- A minor term, which, if breached, gives the innocent party the right to claim damages only.
- A promise of less significance.
Define Innominate Term.
A term that cannot easily be classified as either a condition or a warranty.
What is a Fundamental Breach?
A breach of contract that affects the foundation of the contract. Such a breach may render the entire contract, including the exclusion clause, inoperative.
What is an Anticipatory Breach?
A breach that occurs before the date of performance.
What is the Exemption or Limitation of Liability Clause?
- Clause limiting or excluding liability for breach.
- If you breach, you owe X amount of $$'s.
Define Damages as an Entitlement to a Remedy.
Monetary compensation for breach of contract or other actionable wrong
What is the Remoteness Principle?
- Defendant is responsible for reasonable foreseeable damages suffered by the plaintiff.
- Pain, suffering, and emotional distress are not generally accepted as being a consequence of a breach of contract.
How do you Test for Remoteness?
- 1. Damages could have been anticipated
- 2. Damages are reasonably foreseeable
Define your Duty to Mitigate.
The obligation to take reasonable steps to minimize the losses resulting from a breach of contract or other wrong.
Name 4 Equitable Remedies.
- Specific Performance - court order for the party who breached the contract to do exactly what the contract obligated him to do
- Injunction - Promise not to engage in specified activities
- Interlocutory Injunction - Order to refrain from doing something for a limited period of time
- Rescission - To restore the parties to the situation they were in before the contract was formed
What is Unjust Enrichment?
Occurs when one party undeservedly or unjustly secured a benefit at the other party's expense.
What is Restitutionary Quantum Meruit?
- An amount that is reasonable given the benefit the plaintiff has conferred.
- Can't prove the amount, may get an appraisal of the benefits received.