Chapter 16&17

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  1. Assignment
    Transfer contract RIGHTS to a 3rd party.
  2. Delegation
    Transfer contract DUTIES to a 3rd party.
  3. Absolute Promise
    Must perform. No obligation required on the other side to makre promisor perform (e.g. "I am going to pay you $500")
  4. Conditional Promise
    Conditions must/must-not be met prior to promise needing to be performed (e.g. "I'll pay you $500 if cowboys win")
  5. Discharge by Condition (2 types)
    • The occurence of a subsequent event may affect a party's duty to perform under a contract.
    • *Conditions Precedent & Conditions Subsequent
  6. Conditions Precendent
    An event that must occur before performance is due. No duty to perform until conditions are met. (e.g. buying house contingent on buyer getting approved for home loan)
  7. Conditions Subsequent
    An event that terminates a duty of perfomance. Duty to perform UNTIL CS has been met (e.g. agreeing to work OT UNTIL new staff hired)
  8. Discharge by Performance
    • Fulfillment of a contractual obligation resulting in discharge (also by tender).
    • * One party is ready willing and able to perform but other party isn't.
  9. Breach
    A wrongful failure to perform
  10. Material Breach
    Non-breach party is discharged from any further duty under the contract and can recover damages. (Must be essential duty that has not been performed: e.g. serious quantitative or qualitative defect; "bad faith" breach [dishonest intent, never intended to perform]; late performance when time is of essence; any material breach as defined in contract)
  11. Minor Breach
    Non-breaching party is NOT discharged from any further duty under the contract, but is still entitled to recover damages.
  12. Substantial Performance (under minor breach)
    Incomplete performance that does not defeat purpose of the contract.
  13. Mutual Recission
    A subsequent agreement b/w the parties to terminate the original contract. (Must be mutual)
  14. Subsituted Contract (2 types)
    • A new contract accepted by both parties in satisfaction of the parties' duties under the original contract.
    • * (1) Accord and Satisfaction; (2) Novation
  15. Accord and Satisfaction
    • Subsituting one duty for another (e.g. originally hired to paint kitchen but buyer asks to pain garage instead.
    • *Accord - The new agreement
    • * Satisfaction - Performance of Accord
  16. Novation
    Parties enter into a substituted contract where one party is discharged and a substitute party takes his place. All 3 parties must agree. (e.g. I am painter, can't do job I agreed to, have my brother do it instead, all of us agree, including buyer)
  17. Impossibility (2 types)
    • Performance of contract cannot be done.
    • * Subjective and Objective
  18. Subjective Impossibility
    The promisor cannot peform. Doesn't mean no one can. Does NOT discharge the contract.
  19. Objective Impossibility
    NO ONE could perform the promisor's duty under the contract (unforseen drought)
  20. Commercial Impractibility
    • When performance could be accomplished by only under unforeseen and unjust hardship (unfair to promisor under circumstances). Court may discharge promisor from the contract.
    • * Case on page 331 in book
  21. Destruction of Subject Matter
    Discharges contract (if it occurs w/out the promisor's fault)
  22. Subsequent Illegality
    If performance becomes illegal or impractical as a result of a legal change, the duty is discharged. (e.g. K for sale of automatic guns, then congress passes law outlawing them)
  23. Bankruptcy
    Discharge available if debtor obtains an order of discharge by the bankruptcy court
  24. Statute of Limitations
    After SL has run, a party w/ a claim against another for breach of contract can NO LONGER enforce it.
Card Set:
Chapter 16&17
2012-05-29 20:20:18
Chapter 16 17

Chapter 16&17
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