Performance

Question 1

Performance obligations

Answer 1

Under common law , a party must substantially perform its contractual obligation in order to demand performance (usually payment) from the other party.

Courts will look at several factors to determine whether the performance was substantial.

Question 2

Exception - divisible contracts

Answer 2

A contract is divisible so long as the :

1. is apportionable and
2. the parties would have contracted for each part separately.

A party that performs one or more parts of the contract may collect payment for those parts even if he does not substantially complete performance of his duties.

Question 3

The perfect tender rule

Answer 3

Under the UCC- perfect tender is required. Which means that a seller must deliver goods perfectly conforming good in accordance with the terms of the contract.

The smallest nonconformity is a breach that allows the buyer to reject all or portion of the goods.

Question 4

The perfect tender rule applicability to installments contracts

Answer 4

They do not have to satisfy perfect tender.

Question 5

When can a buyer reject installment delivery (UCC)

Answer 5

When there is a substantial impairment in the installment that cannot be cured.

Question 6

What happens when a seller fails to tender perfect goods (UCC)

Answer 6

The buyer must give the seller a chance to cure the nonconformity if

1. The time for performance under the contract has not yet expired ; OR
2. The seller has reasonable grounds to believe that the buyer would accept a replacement for the nonconformity.

Question 7

Revocation of accepted goods

Answer 7

If a buyer accepts goods, he can no longer reject them.

Question 8

What circumstance can a buyer revoke his acceptance of the goods.

Answer 8

1. the nonconformity substantially impairs the value to him.
2. he accepted the goods because he had a reasonable believe that the nonconformity would be cured or he did not discover the the nonconformity because the nonconformity was difficult to discover or because of the sellers assurances ;
3. he revokes within a reasonable time after he discover should have discovered the nonconformity and
4. he revokes before any substanital change in condition of the goods which is not caused by their own defect.

Question 9

What is available to a buyer who revokes acceptance of goods ?

Answer 9

May recover the purchase price that has been paid.