Contracts Rules 2

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Contracts Rules 2
2010-07-16 22:02:13

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  1. Impossibility
    Impossibility in the thing to be done, not just the ability of the promisor to do it.

    Valid if:

    • performance becomes illegal
    • specific subject matter of the contract is destroyed
    • party performing personal services dies or becomes incapacitated
  2. Impracticabillity (non-UCC)
    Available where contract was formed on a basic assumption that an unforeseeable event would not occur, the event occurs and makes performance impracticable, and the party seeking discharge is not at fault.

    Not available for a bad deal. Requires totally unexpected occurrence.
  3. Impracticability (UCC)
    Total impracticability: -

    • Goods identified at time of contract are destroyed
    • Performance becomes illegal
    • Performance has been made impracticable (unexpected contingency occurred making performance impracticable)

    Partial Impracticability - Goods actually produced are apportioned among all buyers.

    The UCC allows for a defense of commercial impracticability.
  4. Frustration of purpose
    Unex[ected events arise that destroy one party's purpose in entering into the contract. Must not be the fault of the frustrated party, and its non-occurrance must have been a basic assumption of the contract.

    Occurrence need not be completely unforeseeable, but must have been unexpected and not realistic.
  5. Rescission
    Non-defaulting party may rescind, or parties may recind by mutual agreement by surrendering their rights under the original contract.

    Mutual rescision NOT allowed where a third-party beneficiary's rights have already vested.
  6. Release
    WRITING that manifests intent to discharge another party from existing duty.

    • Common law: must be supported by consideration
    • UCC: no consideration needed