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20 Cards in this Set

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Excuse: Prevention and Cooperation

How do you decide who's performance goes first when it is between a contractor and the demand for payment.
Sullivan v. Bullock
• The contractor would have to perform first because his performance takes longer
• She does not have to pay him until he is finished. Since it is a condition precedent she does not owe him a dime unless he does everything correctly.
• Why might we excuse his failure to perform correctly?
• The Court of Appeals, Walters, C.J., held that: (1) finding that contractor had not substantially performed under contract, but that homeowner unreasonably prevented contractor's performance, was supported by evidence; (2) award of damages in full amount of contract price to contractor was erroneous; (3) evidence did not support portion of damages awarded to contractor for electrical work not originally contemplated in contract; (4) substantial evidence supported finding that contractor did not breach contract to remodel home; (5) instruction on issue of prevention was adequate and; (6) evidence of bills from subcontractors submitted to homeowner was irrelevant.
prevetion excuses non-performance
Excuse: Prevetion and Cooperation

What if there is an express condition that is met but you caused it to happen? Is it still an excuse?
If there is a clause in the contract that says "that sangawure could dismiss the subcontractor if Pointdexter Plumbing became insolvent?" This is an express condition. However, S itself had financial problems, leading it to be late on several progress paymentsit was required to pay P Plumbing. This than caused PP to become insolvant. He is insolvent but this condition can be excused because you are responsible for it. It is different from the Sullivan case because the Sullivan case is a condition precedent this is an express condition.
Excuse: Prevention and Coooperation

Whar if you were hired for permenat employment and then were fired because someone didn't like you. Could you sue?
o Permanent employment does that mean that you don’t have to be fired. It means full time and more benefits than part time.
o Does employment in will force the employer to act in good faith.
o There can be no breach of the implied covenant of good faith if a party is only doing what it is entitled to do under the contract provisions. Occasionally, courts find that the breach of the implied covenant of good faith gives fries to remedies for a breach of the good faith obligations itself.
o The duty of good faith does not give rise to an independent cause of action but only to a right to defend against a party’s own failure to perform
Prevention and excuse:

What does good faith have to do with Prevention and cooperation?
They are closly related when one party actively attempts to ruin a contractioal relationship the court may find a material breach of an implied promise (covenant): a not to prevent the other party from performing; to cooperate in ensuring performnace is achieved; Or to act in good faith. The boundaries of good faith are generally defiend by the parties intent and reasonable ex[ectatopms in entering into the K.
Prevention and excuse:

Good Faith Rule
The good faith rule does not give rise to an independent cause of action, but only a right to defend against a party's own failure to preform, that is because of the brach of the implied condition of good faith the party argues that its own obligatino was excused. It give you the availability to defend against own performance.
Forfeiture as an excuse:

Burger King
Burger King Corp. v. Family Dining
• Bk says that they are not going to negotiate on the exclusivity of the contract.
1. If you build 10 restaurants over 10 years you get 80 years of exclusivity. (Condition precedent in which you activate the duty)
2. You get 90 yrs of exclusivity unless you fail to build 10 restaurants on schedule in which case you lost the exclusivity. (Condition subsequent)
o The court considers this to be a condition subsequent. If we say that we are going to excuse your failure to do it on time.
o This case is not only a forfeiture case it is also a waiver case bottom of 730. The question arises whether BK has precluded itself from asserting Family Dining’s untimeliness on the basis that BK hid not demand literal adherence to the development .
o There is a waiver .. Based on the foregoing the Cort concludes that BK is not entitled to have the condition protecting its promise sritckly enforces.
o Bottom of 731- a) will involve extreme forfeiture or penalty b) its existence or occurrence forms no essential part of the exchange for the promisor’s performance
o Was meeting this contract material to this contract?
Excuse of a condition to avoid forfeiture
To the extent that the non-occurrence of a condition would cause disproportiante forfeiture, a court may excuse the non-occurrence of that condition unless its occurrence was a material part of the agreed exchange.
Excuse of a condition to avoid forfeiture:

What if at midnight before the renewal of a lease the lanlord refused thier orrfer to renew because they were turning the building into a parking lot.
The courts would argue that it is extreme and disproportionalte to throw them out on the street.
Excuse for Public Policy:

Is a provisions in a K, that makes written notice of a claim a condition precedent to recovery contrary to public policy?
In Inman v. Clyde drilling. It was an employment contract where the D argues that he was fired without justification and that was the breach of the K, and that he was entitled to damages for the breach of the K. The company argued that the D failed to give written notice of his claim as required by the K, was a bar to his action based on the K. That this was a required condition precedent to any recovery. The court says that notice should be a condition precedent to any recovery. The company did not to plead lack of notice as an affirmative defense but insteat that D was required to plead perfromance of the condition or that performance had been waived or excused.o The court admits that public policy might be an excuse. The legislature is the one who can enforce public policy.
o They say that it is not against public policy so you can not sue
o You might be able to argue that a particular condition would be against public policy
Waiver vs Estopple:

What is the difference?
Waiver and Estopple- you can only use waiver is restricted to conditions that are relatively minor. Estopple can be used for material and immaterial things. Waiver is passive conduct, estopple is overt conduct. Waiver it the voluntary relinquishment of a known right or benefit. People normally don’t give up something that is material.
Estopple is a persons being precluded from insisting on a right because there conduct has somehow mislead or harmed the other party. Causing the other party to rely to their detriment. This kind of estopple is equitable.
If you can’t use waiver and you don’t have enough for estopple you can try to use that it was against public policy .If you want to reinstate a condition you must give reasonable notice before you insist on performance.
What are examples of Material Conditions?
o Real estate having clear and marketable title
o Insurance – you can’t waive the requirement of a deceased dying. The causality that triggers the thing to pay that is material
o IN a K for sale – the payment of the purchase price is material
What are examples of immaterial conditions?
Immaterial Conditions
o Notice within a particular time.
o Payment within a particular time.
o Furnishing an architect certificate with regard to progress payments
For exam you are not given hints as to if it was material or immaterial conditions.
Example of Waiver:

The A's bought a car with a contract that said " time is of the esssence" and the failure to make payments was a ground for declaring a default and repossession. They were late on several payments and the car company repossessed the car? Can they do that?
a) would it matter if the car company always trew a fit and threatened to reposees? No because o Contract says that time is of the essence
o It is passive so it is an example of a waiver.
b.) what if it said that " acceptance of late payments shall not be construed as a waiver of the right to delcare a dfault because payments are not made as agreed; in spite of acceptance of such late payments, time remians of the essence? No you can waive this type of clause.

c.) What if the car company wanted to reinstate the time is of the essence clause? They couldn't but they could give reasonable notice of repossession.
Waiver and Estoppel:

Does acceptance of late payments waive the right of the creditor to repossess witout notice after subsequent late manyment defaults?
Some courts say no. Other's impose a duty on the creditor to notify the debtor that strict compliance with the time for payment will be required in the furite or else the K remebed may be invoked. The majority of the courts choose the later.

• Is this material or immaterial . it has to be immaterial they have to waive it. If there is a possibility they have to address the No-waiver clause. Some have said that you can waive others say that you can not.
• Middle 742- Deer wants no waiver.
• Majority says you can waive if you want to reinstate you have to give notice. This court adopts the majority pg. 742
• EXAM you need to distinquish between estopple and waiver. Debtor was arguing that creiditor should not be able to proceed because it would be unfair to allow the creditory to proceed without notice betwe debtor relied upon creditor's ignoring the late payments: esstopple. Such action may also show a waiver; the intentional relinquishment of a known right.
Waiver of constructive conditions vs. waiver of express conditions
- A constructive condition can be waived, even if it is a material par to fhte agreed exchange, since the injured party will still be conpensated for the breach.
- The concept of wavier, is restricted to conditions that are relatively minor. Parties can waive conditoni that are essentially procedual or technical, like furnishing of an architecht's certificates as a condition of the duty to make progress payments. Waiver is often invoked to excuse delay in the occurrence of a condition, the courts have been espectially receptive to claims that an insurer has waived the insured's delay in giving notice of loss.
Election:

Cox thinks this is worthless
- Problem 155
o Mr. and Mrs America- this is a condition precedent. You have 10 days to give a notice in writing. The telephone call came before. The Adjuster came after. Both the telephone call and the adjuster could be waiver. If the waiver comes after the factor event it is not called waiver it is called an election. (Don’t know why)
Impossibility:

What is it?
you need a fact or event that is unforeseen and unanticipated (unforeseen) which then would say what was to occur impossible. Impossibility o f performance can excuse the performanc eof conditions in the K. If this occurs the courts must adject the resulting contractual liabilities.
Impossibility:

What if someone who was schedualed to perform falls ill and misses the subsequent practices. The producer hires someone new. She shows up an is ready to perform. The producer failed to give her her role back. Can she sue is he in breach for failing to give her her role back?
o She would be excused because she got sick.
o It is material because it was a new opera. If it was material he is excused from the breach
Impossibility:

If there was a contract for someone to performs is full line of music but he didn't show up on time but 15 days later because he was sick? Can they cancel the K with him?
NO.. The performer can sue because his breach of the K was immaterial.
What is the difference between all three of these?

1) "Sports Facilities, Inc, hereby promise to complete the bobsled run by October 1, 2013

2) Unless the bobsled run is completed by October 1st, 2013, the City shall not be liable for any amount

3) "Sports Facilities, Inc., hereby promises to complete the bobsled run by Oct 1, 2013, and unless it does so the city shall not be liable for any amount
1- Promise

2- Condition

3- Promissory Condition