...15 April 2014 Contract Breach Contracts are in general, an agreement between two or more people. One person puts out an offer and the other accepts that offer. If person A says he will work on person B’s house in exchange for money and both come to an agreement they have entered in to a contract. The offer must be serious and definite with serious intent. When one person breaks the agreement it is known as a breach of contract. If this happens the innocent party can seek remedies or relief from the person who breached the contract. Many different remedies are available for the innocent party but the contract should be reviewed for any limitations or contractual remedies. The most common remedies available are broken down between two categories, remedies at law and remedies in equity. Remedies at law are normally remedies’ that have to do with monetary damages. These damages are designed to compensate the non-breaching party for his or her loss of the bargain. This is where out of pocket expenses and lawyer fees would be considered as they would be incidental damages. Incidental damages would be the expenses caused directly because breach of contract. Punitive damages also fall into remedies at law but are usually only used when there is an offense like fraud involved. The purposes of punitive damages are to punish the defendant for offensive misconduct and to deter the defendant and others from similar misbehavior in the future. Nominal damages...
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...Breach of Contract - A contracting party’s failure to perform an absolute duty owed under a contract. Covenant – An unconditional promise to perform Duress – A situation in which one party threatens to do a wrongful act unless the other party enters into a contract Executed Contract – A contract that has been fully performed on both sides; a completed contract. Injuction – A court order that prohibits a person from doing a certain act. One year rule – A rule which states that an executor contract that cannot be performed by its own terms within one year of its formation must be in writing. Rescind – The act of a non-breaching party to undo a contract where the other party to the contract has caused a material breach of the contract. Statutes of Fraud – A state statute that requires certain types of contracts to be in writing . Unilateral Mistake – A Mistake in which only one party is mistaken about a material fact regarding the subject matter of contract. Bad Faith – An element that must be proven in order to find a violation of the anticybersquatting Consumer Protection act (ACPA) Domain Name – A unique name that identifies an individual’s or company’s website. License – A business arrangement that occurs when the owner of intellectual property ( the licensor) contracts to permit another party ( the licensee) to use the intellectual property. Licensee- The party to whom a license is granted Abusive homestead exemption - A bankruptcy...
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...Breach of the Contract and Remedies for It Breach of the contract is a situation when buyer or seller does not perform its obligations those are mentioned in the contract. By this way, there are some remedies for breach and the party which one does not fulfill his contractual promise should compensate all damages after breach. The main types of breach of contract are minor, material, fundamental, and anticipatory. Minor is a breach of contract that is less severe than a material breach and it gives the harmed party the right to sue for damages but does not usually excuse him from further performance. That means when a party to the contract fails to perform a part of a contract and the fail is very small and all parties can otherwise fulfil any remaining contractual obligations very easily without any consequences. Paul and Bill, two business partners, hire SevenSeas, Inc. to build them a boat. The contract says that SevenSeas will build the boat according to Paul and Bill’s specifications and that Paul and Bill will pay SevenSeas $2 million. One of the specifications that Paul and Bill lay out is that the boat must contain bullet-proof windows. SevenSeas builds the boat exactly according to specifications except for the windows, for which SevenSeas accidentally uses ordinary glass. Using the guidelines laid out above, the court would most likely rule that SevenSeas’ breach was minor: SevenSeas has basically finished performance, the breach was accidental, Bill and Paul...
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...BREACH OF A CONTRACT Hadley vs Baxendale. About the Companies. Hadley carried out an extensive business as millers. Their business was stopped due to a breakage of the crankshaft on which the whole mill worked. They gave the crankshaft carrying order to Baxendale , a carrier company. But due to some reasons the delivery of the crankshaft was delayed by the carriers and because of that the plaintiffs(Hadley) had to incur losses. The plaintiffs claimed that the defendants(Baxendale) should pay them for the special damages as well since it was because of the delay of the delivery that they had to incur huge losses. Case Scene 1 Mr Hadley() (calling Mr Baxendale on phone ): Hello Mr Baxendale, this is Mr hadley speaking. Mr Baxendale() : Hello, Mr Hadley, good to hear from you. I hope you have got your delivery of the crankshaft by now. Mr Hadley : Yes Mr Baxendale, I have got the delivery. But I am afraid to say that it was late by three days!! And because of that, my company could not operate for all this duration and had to suffer huge losses because of that. Mr baxendale : I am really sorry to hear that Mr Hadley. Mr Hadley : U had signed the contract for carrying the shaft in three days and I think you must pay us for the losses we have suffered because of your negligence in the delivery of the crankshaft. Mr Baxendale : Mr Hadley, We had signed the contract but I Do not think we should be paying for your losses. After all we carriers and we did our duty...
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...Remedies Available for Breach of Contract Breach of Contract – the nonperformance of a contractual duty. A Breach of Contract occurs when one party of a contract fails to perform his or her specific obligations under a contract. Example: Alison Parker enrolled in a Business Law class, she has a friend, Phil Michaels that has taken the same class the previous semester. Phil offers to sell his used book to Alison for $25.00, Alison agrees. When they meet for the exchange, Alison has the money, but Phil has already sold the book to someone else for a higher price. Phil has breached their oral contract, and Alison is entitled for compensation. Remedy – the relief provided for an innocent party when the other party has breached the contract. There are two kinds of remedies available for a Breach of Contract: Damages and Equitable Remedies. Damages – the monetary compensation a nonbreaching party is awarded in a breach of contract. 1. Compensatory Damages – Damages that compensates the nonbreaching party for the loss he or she incurred as a result of the breach of contract. The monetary award is to replace the loss caused by the breach, to “make the nonbreaching party whole.” Example: Mary Ann is a professional house-sitter. She contracts to housesit for Ginger for the first three weeks of June for $3,000. The day before Mary Ann’s arrival to Ginger’s house, Ginger cancels and is in breach. Mary Ann was able to find another client, but because of the short notice, can only...
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...principle of law The right to terminate performance on grounds of breach of contract is a remedy that originated in the common law courts. It consists of rejecting a defaulting party’s flawed performance and/or putting a stop to further performance of the contract. Termination right to perform consists of: -Termination of performance is only available as a remedy for relatively serious breaches of contract or another word is breach of condition. Associated Newspaper Ltd Bancks (1951). It also available for a breach of nominated (intermediate) term, if the breach substantially deprives the plaintiff of an intended benefit of the contract. Koompahtoo Local Aboriginal Land Concil v Sanpine [2007]. - Non-performance or Partial performance of one or more conditions in the contract, or if partial performance give rise to a sufficiently serious breach of innominate term, the non-defaulting party may reject that performance and put a stop to any further performance. Varley v Whipp [1900]. -Hidden defect in goods or services supplied to amount or serious breach of an innomiate term, the non-defaulting party will be entitled to reject what was supplied and put a stop to further performance. Finch Motors Ltd v Quin (No 2) [1980]. -An anticipatory breach of an entire contract, or of a condition in a contract or a repudiation of an innominate term, which would amount to a serious breach, the non-defaulting party, has the right to terminate performance...
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...Chapter 20 What constitutes a Breach of Contract? * The question of remedies does not become important until it is first determined that a contract has been violated or breached. Breach - failure to act or perform in the manner called for in a contract. Anticipatory breach – Promisor’s repudiation of the contract prior to the time that performance is required when such repudiation is accepted by the promisee as a breach of the contract. Anticipatory repudiation - repudiation made in advance of the time for the performance of the contract obligations. * To constitute such repudiation, there must be a clear, absolute, unequivocal refusal to perform the contract according to its terms. * When they say they’re not gonna do what they were gonna do and they’re not gonna get it done on the day they said. * * A refusal to perform a contract that is made before performance is required unless the other party to the contract does an act or makes a concession that is not required by the contract is an anticipatory repudiation of the contract. * A party making an anticipatory repudiation may retract or take back the repudiation if the other party has not changed position in reliance on the repudiation. * However, if the other party has changed position, the party making the anticipatory repudiation cannot retract it. Anticipatory repudiation by conduct: * The anticipatory repudiation may be expressed by conduct that makes it impossible...
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...The analysis and solution of Paul’s case A: The contract between Paul and Bagel Parkson is not been frustrate. Frustration is the situation where an unexpected event occurs, for which neither party is responsible, with the result that the very basis of the contract is destroyed. For the successful pleading of frustration, there are three essentials must be satisfied. 1) The even occurs which was outside the contemplation of the parties. On the other words, both of the parties did not predict what things will happen. The case of it is Jackson V Union Marine Insurance. 2) The contract, if performed, would be different contract from that entered into. That is to say, if the particular of the contract has change, the contract is different. The case is Krell V Henry. 3) The event is one for which neither party is responsible for. That is both of the parties can not control things will happen. The contract between Paul and Bagel Parkson had destroyed without the three essentials above. Bagel Parkson was arrested by the police in his hotel room for drug possession and consumption. That is a personal problem of Bagel Parkson. If Bagel Parkson did not have drug in his room, then police would not arrest him, then he can performance. But he had drug in his room, he crime make police arrested him. That is say, he make the performance can not precede. The fact of this case is similar to Maritime National Fish V Ocean Trawlers. （Chandran, R., P114）There is a case, there is a...
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...DISCHARGEMENT OF CONTRACT The law of contracts forms a substantial part of our various relationships that can have some sort of influence over us on an almost daily basis – even when there is no physical contract in front of us we may still be privy to some sort of contractual obligation. Alternatively, if you’re a fan of social theorists such as Jean-Jacques Rousseau, you may argue that we’re also bound by ‘the social contract’, but we digress. Getting back to our original point, the law of contracts plays an enormous role in many of our interactions and for the most part, there may be no real concern in regards to the performance of a contract and an agreement will be completed accordingly. However, this does not mean that issues won’t arise within a contractual relationship, and there may be circumstances where you may need to discharge a contractwhich can be done by either one, or all of the parties to the agreement, and can be discharged by either: * BY PERFORMANCE * BY MUTUAL AGREEMENT * BY SUPERVENING IMPOSSIBILITY * BY OPERATION OF LAW * BY LAPSE OF TIME * BY LAPSE OF TIME BY PERFORMANCE Before exploring the general ways in which a contract can be discharged, the most obvious way in which acontract will come to an end, is when all parties fulfil their contractual obligations and the contract has been discharged via performance. Easy. Exceptions to performance Some people may be of the belief...
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...SUBJECT: The Marley Cooling Tower Company v. Caldwell Energy & Environmental, Inc., 280 F. Supp. 2d 651 United States District Court for the Western District of Kentucky, 2003 A. Facts From the case notes, Caldwell manufactures and installs cooling systems for power plants. There was an agreement between Caldwell and Duke/Fluor Daniel to install one of their systems in South Carolina. Part of the contract stated that Caldwell would “pay liquidated damages of $5,000 per day if the system was late”. The Marley Cooling Tower Company made a pact to ship all materials needed for the construction of this cooling unit and that it would deliver on or before April 1. According to this contract, “Neither Marley or the Purchaser shall be responsible or held liable for any special, indirect, consequential, liquidated, and/or punitive damages.” Also agreed upon was that there was not to be any changes in the contract unless a written and signed documents stated as such. The materials were delivered by Marley 2 months after the April 1st deadline agreed upon in the contract with Caldwell and as a result, Caldwell did not meet its deadline for manufacturing and installing the cooling system and was assessed damages of $135,000 by D/FD. Caldwell then tried to transfer the cost to Marley by paying the same sum less than what was charged by Marley, calling it “backcharges”. A subsequent letter from Marley to Caldwell stated “we would like to work with your to resolve this issue....
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...For example, Mr. Salesperson did not draw up the contract regarding the earnest payment on two occasions when he promised to do so. He did not practice impartially as a dual agent and seemed to be biased towards the seller. It was very unethical not to disclose the deal in the works with the other buyer. The cause of action you have here is a Breach of Contract. Looking at the rest of the facts, all the other things that were done here are not separately actionable and fall under this cause of action. You did the appropriate thing in asking for the extension in regards to the earnest payment and Mr. Salesperson agreed to the terms and seemed to have relayed the information onto the seller. At the time you requested the extension, the seller and Mr. Salesperson could have terminated at that time and moved onto the other deal, but they did not; they accepted your deal and that was unethical and a breach that provides you with a cause of action. The Defendants breached the contract by first agreeing to the extension to the earnest payment, then not drawing up the contract and finally terminating all together and selling the property to another buyer at a higher price. A contract is described as, “A written contract is usually pleaded by setting it out in its entirety in the body of the complaint or by attaching a copy. The other method of pleading is by alleging the making of the contract, and then alleging the substance of its relevant...
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...Scenario #1 Masterpiece wins this lawsuit because there has been no material breach of the contract. Therefore, specific performance is not available as a remedy. A contract is an agreement between two parties that creates an obligation to do or not do something. Therefore, a breach of contract occurs when one or more of the parties fail to honor his or her responsibilities of the contract; thereby subjugating himself or herself to the legal system (“Breach of contract,” 2011). If one or more party (responsible for the completion of the contract) has failed to perform, made it impossible for the other party to perform, or made it known that there is a purposeful intent not to perform, that party has breached its contract. One remedy available for breach of contract is specific performance. Specific performance is a court order that requires a performance to be exactly as it is written in the contract (“Specific performance,” 2011). This action only occurs during real estate transactions and other unique properties, otherwise the situation is minimal. Specific performance is rare because the courts do not like the responsibility of monitoring performance. So under the assumption that there has been a breach of contract, specific performance would not be a likely remedy. Also damages would be awarded to Foodmart to help bring the building renovations up to standard. In this scenario, the contract between Foodmart and Masterpiece was not breached because Masterpiece performed...
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...first lesson is at the hospital.. not valid Hypo… Molly offers hand-made shirts for sale for… Damages To extinguish liability under a contract, a party must provide d. COMPLETE PERFORMACE “material breach” “Substantial performance”-> half of the work done Complete performance -> the work is complete Types of Damages Compensatory compensate injured party for what they have lost -what you were promised minus what you got -incidental damages ( postage) -sale of goods * What you paid and what you should have paid -sale of land * Difference between the contract price and market price Hypo Google contrats with Dell….. What is the proper amount of compensatory damages (400-375)=$25 ($25*100 computers )+($10 shipping cost*100 computers) “Compensatory” “Incidental” Construction Contracts * Breach before contract has begun -contractor can recover only profits he would have made * During -costs to date and profit * After -can recover the entire contract plus interest IF the contractor braches then the owner gets the cost to complete the house Hypo Happy Home Builders…… What amount can Happy Home Builders get? 1/3 complete In the during process Assume 90,000 + 30,000 profit Hypo Miguel buys a 1967 Mustang on…. Difference on market value-> compe value Undo contract More types of Damages Consequential...
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...Lecture 4 & 5 - CISG- International Contracts of Sale of Goods Contract * The issues in this case is -- what is the governing law? -- Does CISG apply? -- Is there a breach of contract by (seller) as regards to (a) Delay of delivery (b) quality if wines? -- What are the remedies available to (buyer)? 1. Is there a choice of law clause? * ( Yes – Australian is the governing law ) ( No- where there is no choice of law clause in the sale contract, courts will choose the law of nation which has the ‘ closest and most real link to the contract- The forum of the contract * Currency of payment * Place of performance of contract * Place where contract is concluded * Residency of parties to contract * Subject matter of contract * Contract concluded in Aus, using AUD$, Performance is in Australia therefore, governing law of this contract is Australia. * The governing law is determined following the steps laid down in John Kaldor v Mitchell Kotts . * Under Article 1(a) Vienna Convention 1980, both countries must be signatory of Vienna Convention. In fact, both (China and Australia) is signatory countries, there for VC will apply. * Moreover, under Article 1( b) Vienna Convention 1980, if the governing law of contract and the country is the signatory of VC, VC applied. * Furthermore, incoterm … * Offer and acceptance (Notes) * Under Article 23 of Vienna Convention, contract is concluded upon effective acceptance of...
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...International contracts must be clear and concise. Especially when regarding risk of loss. Risk of loss in sales contracts refers to who will be held liable if an unforeseen incident occurs as in damage or loss of the items for sale. Under section 2-301 General obligations of parties of the Uniform Commercial Code, “The obligation of the seller is to transfer and deliver and that of the buyer is to accept and pay in accordance with the contract.” However, there are some additional conditions. 2-509. Risk of Loss in the Absence of Breach. (1) Where the contract requires or authorizes the seller to ship the goods by carrier (a) if it does not require him to deliver them at a particular destination, the risk of loss passes to the buyer when the goods are duly delivered to the carrier even though the shipment is under reservation (Section 2-505); but (b) if it does require him to deliver them at a particular destination and the goods are there duly tendered while in the possession of the carrier, the risk of loss passes to the buyer when the goods are there duly so tendered as to enable the buyer to take delivery. (2) Where the goods are held by a bailee to be delivered without being moved, the risk of loss passes to the buyer (a) on his receipt of a negotiable document of title covering the goods; or (b) on acknowledgment by the bailee of the buyer’s right to possession of the goods; or (c) after his receipt of a non-negotiable document of title or other written direction...
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