Docstoc

1 Ways by which contract may be discharged 2 Discharge by performance 3 Discharge by agreement 4 Discharge by frustration 5 Discharge by operation of law 1 Ways by which contract may be discharge

Document Sample
1 Ways by which contract may be discharged 2 Discharge by performance 3 Discharge by agreement 4 Discharge by frustration 5 Discharge by operation of law 1 Ways by which contract may be discharge Powered By Docstoc
					1 Ways by which contract may be discharged
2 Discharge by performance
3 Discharge by agreement
4 Discharge by frustration
5 Discharge by operation of law
1 Ways by which contract may be discharged


 (1) Discharge by performance
 (2) Discharge by agreement
 (3) Discharge by frustration
 (4) Discharge by operation of law
2 Discharge by performance
  2.1 Normal way of performance
  (1) Depending on nature of the contract:
        Services rendered
        Goods delivered
        Cash paid
        Or their combination
  (2) This is the ideal way of discharge a contract.
2.2 Tender of performance

 (1) In the form of legal tender: silver coin $10,
 (2) It is OK whether accepted or rejected by
   other party.
  Case illustration:
• S agrees to sell $ 1000 worth of flour to B, cash on delivery.
  Before delivery flour price rises substantially. S wants to
  avoid the contract and hearing a rumor that B is in financial
  difficulty. He uses this as pretext for terminating contract. B
  of course wishes to go through with the deal at agreed price.
  B takes the contract to the bank and borrows sufficient cash
  in legal tender. B then tenders the money to S in the
  presence of C. If S doesn’t deliver flour, B may sue S for
  breach of contract.
3 Discharge by agreement
 3.1 Waiver
 3.2 Substituted agreement
   (1) Material alteration of the terms
  (2) Accord and satisfaction: si liao (in Chinese)
   (3) Novation: third party steps in
 3.3 Contract term provides for its own dissolution
   (1) Condition precedent
Case illustration:
A located in Moncton writes to B in Winnipeg
 offering him a good position. B replies by letter
 that he will take it if A will first find satisfactory
 living accommodation for his family. A accepts
 B’s counter offer by mail. A’s act of finding
 specified living accommodation is a condition
 precedent.
(2) Condition subsequent
Case illustration:
• Norton, holder of a baseball season’s ticket, got the tickets
  on the terms that he must watch his conduct at games due to
  some of his habits known to the management. He attended a
  game and his conduct was annoyance and nuisance not only
  to the operator of ballpark, but also to other fans and to
  those selling tickets.
• The management cancelled his season ticket and tenders
  him a refund for remaining games. Norton sued the
  management for violation contract. Norton’s objectionable
  conduct was condition subsequent, he couldn’t win the
  action.
4 Discharge by frustration
4.1 Definition
     For reasons beyond the control of the
       parties,    the     performance       becomes
       impossible or purposeless after execution of
       the contract.
4.2 True frustration v self-induced frustration
  Case illustration:
• A contracts to transport earth for B. Upon realizing it has
  made bad bargain, A sells all their dump truck and claims
  that it can’t fullfil the contract due to frustration. Obviously
  this is a self-induced frustration.
• A contracts to transport earth for B in an isolated northern
  community. After execution, its truck is stolen and wrecked.
  The contract is therefore discharged by frustration.
Case illustration:
• A contracts to transport earth for B. Its dump
  truck breaks down due to employee’s
  negligence. There will be long delays in its
  repair as it is in a small isolated northern
  community. Since A is attributable for the
  delay, it will be liable for the contractual
  breach.
 Case illustration:
• Howard rented a room to Kennedy along the route
  scheduled for emperor’s procession for the day on
  which the Royal family would appear in Halifax.
  The rent was payable at the time of procession.
  Howard redecorated the room. Later it was
  announced that the route had been changed and
  wouldn’t pass Howard’s building. Kennedy refused
  to pay the rent for the room. Howard sued for the
  rent. Should Howard win?
5 Discharge by operation of law
 (1) The debtor becomes bankrupt.
 (2) Lapse of the prescription: time limit.

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:3549
posted:2/5/2010
language:English
pages:13