Mac 703 - Business Law - Part 6

Front 1

A ______ is an event whose happening / non-happening affects a duty of performance under contract. These are inserted to ______ the ______. Conditions can be classified by ____ they are _____ and ____ they affect a __________. They are not _______.

_____ they are _____:
1. __________
2. __________
3. __________

______ they affect ________
1. _________
2. _________
3. _________

Back 1

condition; protect; promisor; how; imposed; when; duty of performance; mutually exclusive;

How; imposed
1. express conditions
2. implied-in-fact conditions
3. implied-in-law conditions

When; a duty of performance
1. conditions concurrent;
2. conditions precedent;
3. conditions subsequent;

Front 2

Conditions

____ conditions: explicitly set forth in _______. Form is _______, as long as what the performance is subject to is ________. Examples include: _____, _______, _____ and ____.

_______ of a ________. Parties may agree that ______ shall be to the _______ of a party, who will _________ to ______ unless ______. Example? When ______ is according to a _________ or ______, the law applies the _________ standard (meaning the _____ has _____ if the promisor is ________ ____). If the contract doesn't specify that _________ or if performance contracted for ______ or ________, the law assumes a __________. Example?

______ of a ______. Contracts may ______ the performance of a party on _______. Example?

Back 2

express; language; irrelevant; clearly stated; "provided that," "upon," "if," and "as soon as."

Satisfaction; Contracting party; performance by one; satisfaction; not be obligated; perform; he is satisfied;
Ex: Ken agrees to pay Dick $300 for a suit, if he is satisfied. Even if it a great suit, if Ken is unsatisfied, Dick can't recover damages, regardless of reasonableness
satisfaction; personal taste; opinion; subjective satisfaction; condition; not occurred; unsatisfied; satisfaction is subjective; mechanical fitness or utility; objective satisfaction standard.
Ex: sale of building / goods, not whether promisor satisfied, but rather whether he ought to be satisfied.

Satisfaction of a third party; condition; approval of 3rd party;
Ex:If building contract states, architect must approve building before buyer pays builder, no obligation to perform until he approves.

Front 3

Conditions

_______ conditions: Like express conditions: must fully occur and be understood by parties. However, they are _____. Example?

_________ conditions, or _________ conditions, are _______ to accomplish a ________. It differs from express and _____ 2 ways:
1. It is not ________ or _________.
2. It need only to be _______.
Example?

Back 3

Implied-in-fact; implied
Ex: If Edna paints Sy's house for $100, it is an implied in fact condition that Sy will first tell her the color.

Implied in law; constructive; imposed by law; fair result; implied-in-fact;
1. contained in contract; inferred from it; substantially performed;
Ex: Marie and Fred have a deal: land for 18000. These promises are mutually dependent on another and therefore the exchange must be at same time.

Front 4

Conditions:

________ - when mutual duties occur simultaneously

___________ - event that must occur before performance due. Example?

________ - event that terminates existing duty. Occurs infrequently. Example?

Back 4

Condition concurrent

Condition Precedent
Ex: N to deliver shoes on 1/1. P to pay on 1/20. delivery is condition precedent.

Condition Subsequent
Ex: Buyer has right to return goods.

Front 5

Discharge by _______: most common way of discharging. ______ is an offer of one party to perform obligation according to the contract. In a ________, refusal or _____ of ______ by other party can be _____________.

Discharge by ______ - a wrongful _____ to perform. A _______ always allows damages to be ______. However, an uncured ________ is an ______ for ______ of the ________. If the ____ is ______, the _______ party is _______ from K.

Back 5

performance; tender; bilateral contract; rejection; tender; a repudiation of the K.

Breach; failure; breach; recovered; material breach; excuse; nonperformance; aggrieved party; breach; not material; aggrieved; not excused.

Front 6

________ - an unjustified failure to perform ____ the obligations in K. Example?

Here are 5 principals of material breaches:
1. __________________
2. ____________________
3. __________________
4. ____________________
5. __________________

_________ - one party's _______ with ________ constitutes _________ and discharges ________.

___________ - Under ____, any ______ from the contract constitutes a ______.

Back 6

material breach; substantially;
Ex: Tailor creates suit of wool, not cotton.

1. Partial perf. if it omits essential part of K. (house, no roof)
2. Qualitatively or quantitatively serious breach.
3. Intentional breach;
4. Failure to perform promise timely if time is of the essence
5. Specify material breaches in K.

Prevention of Performance; interference; other party's performance; a material breach; other party;

Perfect Tender Rule; UCC; deviation; material breach.

Front 7

Breach:

______ ______ - if a party ______, not completely, ____ obligations under K, entitled to other parties performance minus damages (even if _____). Example?

____________ - a party may announce _______ that he/she _________. This is a _______, because it notifies party that a ______ is imminent. This discharges aggrieved party immediately and allows them to __________ (although they _______ until _______).

__________ of written contract - if done by or on behalf of party to contract, it is a ______ of the K. If not, it does not ______ the K.

Back 7

Substantial Performance; substantially; performs; material breach;
Ex: Joe builds 300,000 building for Mary, but deviates a bit, causing 10,000 in damages. Even if material, entitled to 290,000.

Anticipatory Repudiation; before the due date; will not perform; repudiation; breach; bring suit immediately; wait; due date;

Material Alteration; discharge; discharge

Front 8

Discharge by Agreement:

Mutual _______ - literally a contract to ________ (therefore must have ______).

________ K

_______ and _______ - _______ - replaces contractual duty with another. ______ - when it happens and thus discharges party. Example?

_______ - substituted contract that involves agreement among 3 parties. Discharges old obligation with new promisor / promisee. (B owes $500 to A. They agree that C will pay. Novation)

Back 8

rescission; to end a contract; consideration;

substituted;

accord; satisfaction; accord; satisfaction;
Ex: Dan owes Sara 500, parties agree instead he will paint Sara's house (accord). Satisfaction occurs upon perf.

Novation.

Front 9

Discharge by law:

Impossibility - if this is ______, ie because of ______ inability or ______, it ________ the promisor from _______ the K. However, if K is __________ - where ______ render performance, then party excused. Example?

___________

______ of ______ : Example?

_______ _________: Example?

_________

_________

Back 9

subjective; financial; incompetence; doesn't excuse; performing; objectively impossible; no one could
Ex: Jockey obliged to ride certain horse for race, horse dies. Impossible to fulfill.

Subsequent Illegality

Frustration of Purpose;
Ex: "coronation cases" where rooms rented to see king coronated, but he became ill, and thus no parade. Contracts were discharged.

Commercial Impracticability;
Ex: 10 year contract to buy 1000 bales of hay per year (historic stable price). Price jumps 2000%, and buyer cannot possibly afford to operate (not available for markets with big foreseeable swings like oil.)

Bankruptcy;

Statute of Limitations;