Contract Law Presentation Ways to End Contracts

Tender Tender is an unconditional offer to perform by a person who is ready, willing or able to do so

Complete Performance Most contracts parties fully discharge obligations by performing their duties in way consistent with terms of contract

Substantial Performance This is when a party to a contract honestly performs most but not all elements of contract

Example Erin and Ben contract with Euron Construction Company to build their house. The contract specifies that Ace Brand Plasterboard be used for walls. The builder cannot get Ace Brand and installs Diamond Brand instead. All other features of the house conform to the contract. Does this discharge the buyers from paying for the house upon completion?

Breach Failure to perform part or all of required duties

Anticipatory Breach Act by 1 party to a contract that tells other party that they will not perform when it comes to do so

Example For example, Farmer Joe contracts with John on January 1st to sell 500 quintals of wheat and to deliver it on May 1st. Subsequently, on April 15th Farmer Joe writes to John and says that he will not deliver the wheat. John may immediately consider the breach to have occurred and file a suit for damages without waiting until after May 1st for the scheduled performance, even though A has until May 1st to perform.

Ways to Discharge by Agreement Mutual Rescission –Enforcement agreement to cancel a contract and return parties to position they occupied before contracts formation Novation –Substitution by agreement of new contract for old one with the right under the old one being terminated. A new party is substituted for original Accord –Agreement to perform act to satisfy an existing contractual duty Satisfaction –Performance of Accord

Example of Mutual Rescission A player is traded to a team that is very bad and has no shot of winning a championship. The player absolutely hates and doesn’t want to go there at all. The player and his agent meet with the team general manager and owner and the general manager understands why the player doesn’t want to go there so they both agree to end the terms of the contract and the player is released.

Example of Novation Pear agrees to sell his car to Orange for $3000. Orange then decides he doesn’t want to purchase the car anymore and then Grape comes in and says he wants to buy the car from Pear. Pear agrees and sells the car to Grape.

Ways to Discharge by Operation of the Law Statute of Limitations –Statute that requires anyone claiming a legal right against another to begin proceeding to enforce in a specific period of time Bankruptcy –Proceeding under Federal Bankruptcy code where all assets of debtor are distributed to creditors. The debtor is then discharged or excused from legal obligation to pay most debts Discharge by Impossibility of Performance –Doctrine by which a party to a contract is relieved of his or her duties because is impossible