Chapter 17 - Performance and Discharge

Question 1

Executed Contract

Answer 1

• BOTH parties have PERFORMED the contract.

- Not when both parties have signed.

Question 2

Executory Contract

Answer 2

• At least ONE party has NOT YET performed.

Question 3

Performance

Answer 3

Both parties can perform at the same time.

Question 4

Condition Precedent - Performance

Answer 4

Some event must occur before a party has an obligation to perform.

Question 5

Condition Subsequent - Performace

Answer 5

A party has the obligation to perform until a particular event occurs.

Question 6

Complete Performance - Discharge

Answer 6

Completely fulfilled the contract

Question 7

Substantial Performance - Discharge

Answer 7

• Almost everything was completed.

- Could sue for the small cost incurred from the incomplete performance.

Question 8

Material Breach By One Party - Discharge

Answer 8

• Discharges the other party’s obligation to perform.

- Party fails to completely or substantially perform.

Question 9

Anticipatory Repudiation

Answer 9

Someone already under contract and make it clear to other party that they are not going to perform - a material breach.

• Can sue party for damages, but you could get someone to replace the other party.
• Damages are the difference in cost to get someone else to do the job plus any other cost you may have incurred because of the breach.

Question 10

Other ways to Discharge

Answer 10

1) Death (when estate is gone, debts are discharged).
- Rescission (cancellation from both parties)
- Accord (agreement and satisfaction - perform promise)
- Waiver (one person can waive the other party’s obligation)

Question 11

Impossibility of Performance - TAYLOR vs. CALDWELL

Answer 11

• One party was scheduled to perform in a music hall owned by defendant.
• Music hall burnt down before the date of performance.
• Performers lost revenue.
• Court held that it was impossible for the owner to all them to perform so he wasn’t held liable for the lost revenue.

Question 12

Commercial Impracticability

Answer 12

Contemplated performance has become EXTREMELY and UNREASONABLY DIFFICULT/EXPENSIVE to perform.

Question 13

Maple Farms Case

Answer 13

• Entered into a contract with the school district to provide milk for a year.
• Price of milk increased,
• By supplying milk, they are losing money.
• School wouldn’t let them out of contract.
• Court ruled that they couldn’t get out of the contract because maple farms knew price may fluctuate - wasn’t EXTREMELY difficult to perform.