November 3, 1998

Reanalysis of Free Kick Contract – May 97 exam question

Interpretation of the meaning of clauses

48. promise and condition à refrain from engaging in conduct (was this a promise or condition?) can conclude this is a promise AND condition. If the promise is a material breach, then the contract can be terminated. If the breach is not material, then the contract cannot be terminated.

1. no – free kick does not get damages and is not entitled to terminate
2. yes

1. is material – free kick is excused without liability; free kick entitled to damages from athlete.
2. Not material – damages from athlete only. FK is not excused from performing the contract. Can deduct the damages from the amount still owed to FK.

48. condition. Occurs? à political views to the media?

1. yes – free kick can terminate without liability
2. no – free kick cannot terminate without incurring liability à athlete could recover damages (rest of money owed in contract). She does not have an obligation to mitigate damages. Because she could have more than one contract at one time. Like selling cars – can sell many cars at one time.

condition – do not use language "material breach" when discussing conditions. May allow termination of the contract

forfeiture – will person loose a lot of money in the future by having this contract terminated? Used to refer to denial of compensation that occurs in such a case. Has person relied substantially on performance of the contract. \

if forfeiture is small, then it lends towards material breach. Because ending the contract would not hurt her.

See section 241 in restatement . Terms a-e

If there is a lot of forfeiture involved, will be harder to say there is a material breach.

Plante v. Jacobs

There was substantial performance, so the owner could only collect damages, but is not excused from promise to pay.

(if there was found to be NO substantial performance, owner would get damages and be excused from paying the contract price)

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November 5, 1998

No drafting on midterm and final

Review next Tuesday

• write an answer to the May 1995 question
• review notes, outline, before doing the question

Substantial performance

Kinds of situations in which a court would use vocabulary of substantial performance:

• Contractor finished, then discovered the wrong type of pipe was used; this is a situation where words substantial performance would be used
• Did they substantially complete the contract?
• Has essential purpose of the contract been performed?
• Look at purpose to be served, inequity of forced adherence
• Restatement section 241:

Kinds of situations in which a court would use vocabulary of material breach:

• if a breach occurred in middle of a contract; then P want their money back. Court would ask if there was a material breach.

Diminished value rule - value of house as promised minus the value received

Divisible contract – price promised under the contract can be proportioned to each item in the contract (example: contract for 24 boxes of gloves, each box can have a set price) not everything is divisible – like a certain amount of stone needed for construction of a bridge – all the stone was needed in order to construct the bridge. Where in divisible contracts, the buyer can use at least some of what was received.

Material breach because person did not complete year of contracted labor (instead only did 9.5 months).

Restitution for benefit conferred? Or should person get nothing if breach was willful?

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November 10, 1998

Review of Britton v. Turner

When determining a material breach, consider §241 factors:

Section 241 Contract Restatement – page 273

In determining whether a failure to render or to offer performance is material, the following circumstances are significant:

1. the extent to which the injured party will be deprived of the benefit which he reasonably expected;
2. the extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived;
3. the extent to which the injured party failing to perform or to offer to perform will suffer forfeiture;
4. the extent to which the injured party failing to perform or to offer to perform will cure his failure, taking into account of all the circumstances including any reasonable assurances;
5. the extent to which the behavior of the party failing to perform comports with standards of good faith and fair dealing.

§374 - Get restitution if there has been a benefit conferred

• possibly it is better to have a "bright line standard" rather than a standard that fosters dispute

§371 – measure of restitution interest

Mooney v. York Iron

• a shaft was partially dug and then never finished

November 12, 1998

I am willing to give three dollars to the first person who does the following:

Was this a promise?? Or maybe just a proposition

Promises:

• if the offer was made in jest and the other person knew or had reason to know it was made in jest, there is no contract
• if the offer was made in jest and the other person did not know and had no reason to know it was made in jest, then the contract must be carried out