4516342
Description
Mind Map by XinHui Amberlyn, updated more than 1 year ago
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Created by XinHui Amberlyn
over 10 years ago
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Discharge of Contract
- Discharge by agreement
- Both parties agree to excuse
the other from performance.
Consideration : Each party’s
promise to excuse the other
from performance
- Both parties agree to excuse
the other from performance.
Consideration : Each party’s
promise to excuse the other
from performance
- Discharge by performance
- Each party has done what
they promised they would do
– Contract comes to an end.
- performance must be precise
and exact, if the performance
is incompleted, he might not
be able to claim the payment.
- performance must be precise
and exact, if the performance
is incompleted, he might not
be able to claim the payment.
- 5 exceptions
at common
law & by
statue
- 1 . Apportionment Act
- certain periodical
payments such as salary,
rent are deemed to
accrue day to day.
- certain periodical
payments such as salary,
rent are deemed to
accrue day to day.
- 2. Principle of Substantial
Performance
- Applies when party has done most or all of
what is required under the contract BUT
there are minor defects or omissions
- Party cannot claim the full
contract price due to him as
there will be a deduction for
the cost of correcting the
defects
- Hoening
- Hoening
- Party cannot claim the full
contract price due to him as
there will be a deduction for
the cost of correcting the
defects
- Applies when party has done most or all of
what is required under the contract BUT
there are minor defects or omissions
- 3. Prevention of Performance
- If one party’s incomplete
performance is caused by
the other party who
wrongfully prevented full
performance,
- then the party who has
partly performed is
entitled to be paid for
what he has done. He may
claim damages, or
quantum merit basis(that
which one has earned)
- then the party who has
partly performed is
entitled to be paid for
what he has done. He may
claim damages, or
quantum merit basis(that
which one has earned)
- If one party’s incomplete
performance is caused by
the other party who
wrongfully prevented full
performance,
- 4. Acceptance of
Partial
Performance
- Done part of performance,
paid part of payment with
a reasonable amount on
quantum meruit basis
- Done part of performance,
paid part of payment with
a reasonable amount on
quantum meruit basis
- 5. Severable or
Divisible Contracts
- Divisible Contract made
up of smaller, separate
transactions. Party
entitled to be paid so
long as he finishes one
part of the contract.
- entire contract - not
entitled to paid unless
completes full
performance
- cutter
- cutter
- Divisible Contract made
up of smaller, separate
transactions. Party
entitled to be paid so
long as he finishes one
part of the contract.
- 1 . Apportionment Act
- Each party has done what
they promised they would do
– Contract comes to an end.
- Discharge by breach
- Anticipatory Breach
- One party indicates that he
no longer wishes to perform
the contract BEFORE the date
for performance has arrived.
- a. Treat the contract
as discharge and
claim compensation
at once
- hochster
- hochster
- b. Treat the contract as
ongoing and insist on the
performance of the
contract on the due date.
- will no longer be able
to claim for
compensation
- Avery
- Avery
- will no longer be able
to claim for
compensation
- a. Treat the contract
as discharge and
claim compensation
at once
- One party indicates that he
no longer wishes to perform
the contract BEFORE the date
for performance has arrived.
- Anticipatory Breach
- Discharge by frustration
- Frustration: After a contract is formed an
unforeseeable event which is beyond the
control of the parties occurs
- And either
- Contract becomes
impossible to perform
- Contract becomes
illegal to perform
- Performance of the contract
becomes radically different from
what parties originally thought.
- Contract becomes
impossible to perform
- Effect of frustration: – Contract is
discharged. Parties cannot be sued
for not carrying out the contract.
- And either
- 4 examples of situation
are frustrated by
common law
- 1. Destruction of the
subject matter of the
contract
- Taylor
- Taylor
- 2.Serious illness or
incapacity of a party to a
contract for the provision of
personal services
- condor
- condor
- 3. Governmental
Acquisition
- Singapore
woodcraft
manufacturing
- Singapore
woodcraft
manufacturing
- 4. A change in the
law making the
contract illegal
- Czarnikow
- Czarnikow
- 1. Destruction of the
subject matter of the
contract
- 2 Situations Which
Do Not Amount to
Frustration
- 1. a contract subsequently
becomes more difficult
or expensive to perform
- Davis Contractors
- Davis Contractors
- 2.Self-Induced
Frustration
- due to the conduct of
one of the parties
- The Super Servant Two
- The Super Servant Two
- due to the conduct of
one of the parties
- 1. a contract subsequently
becomes more difficult
or expensive to perform
- Effects of Frustration
- Contract is discharged (comes to an
end). Parties released from all future
obligations. Obligation already due
before frustration still has to be
performed.
- Obligations relating to the payment of
money - Effects of frustration are stated in
the Frustrated Contracts Act (FCA).
- UNDER FCA 4 types of Effects of Frustration
- 1. Any money paid before the
contract is frustrated can
generally be recovered.
- 2.Any money payable under the
contract at the time of frustration no
longer has to be paid.
- 3. If expenses have been incurred in
performing the contract – the person
incurring the expenses may be
allowed to retain or recover his
expenses.
- 4.If a person obtains a valuable benefit before
frustration, the court may require him to pay a
reasonable sum for the benefit he received.
- 1. Any money paid before the
contract is frustrated can
generally be recovered.
- FCA does not apply to
3 categories
- Contract by the carriage of goods by sea
- Insurance companies
- contract of the sale of specific
goods where the goods have
perished before the risk has
passed to the buyer
- Contract by the carriage of goods by sea
- UNDER FCA 4 types of Effects of Frustration
- Obligations relating to the payment of
money - Effects of frustration are stated in
the Frustrated Contracts Act (FCA).
- Contract is discharged (comes to an
end). Parties released from all future
obligations. Obligation already due
before frustration still has to be
performed.
- Force Majeure Clauses
- What happens to the contract,
should certain events occur - e.g.
war, riots, natural disasters, labour
and raw material shortages
- Useful to have allows parties to
treat contract as discharged in
situations that would not be
considered frustration under
common law.
- Coverage of force majeure clause – up to
parties to negotiate. Parties can even
choose to suspend the contract for a
period of time first.
- Suspended for 14 days.
Continue after 14 days.
- China Resources
- China Resources
- Suspended for 14 days.
Continue after 14 days.
- Coverage of force majeure clause – up to
parties to negotiate. Parties can even
choose to suspend the contract for a
period of time first.
- Useful to have allows parties to
treat contract as discharged in
situations that would not be
considered frustration under
common law.
- What happens to the contract,
should certain events occur - e.g.
war, riots, natural disasters, labour
and raw material shortages
- Frustration: After a contract is formed an
unforeseeable event which is beyond the
control of the parties occurs
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