LGS chapter 10 lecture notes
LGS chapter 10 lecture notes LGS 200 - 008
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LGS 200 - 008
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This 3 page Class Notes was uploaded by Conner Jones on Wednesday February 24, 2016. The Class Notes belongs to LGS 200 - 008 at University of Alabama - Tuscaloosa taught by Charlye S. Adams in Summer 2015. Since its upload, it has received 55 views. For similar materials see Legal Environment of Business in Law and Legal Studies at University of Alabama - Tuscaloosa.
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Date Created: 02/24/16
Chapter 10 – Contract performance, Breach, and remedies Voluntary consent defense of valid contract (lack of voluntary consent) o mistake- only mistake of FACT allows contract to be cancels unilateral mistake of fact: when one party is mistaken to a material fact, general rule: mistaken party has no right to relief exceptions: o other party knows, should have known that it was a mistake o mistake was due to inadvertent math error (no gross negligence) bilateral (mutual) mistake of fact: when parties are mistaken as to same material fact, general rule: contract may be rescinded by either party mistake of value: when mistake concerns the later market value of object, general rule: contract is enforceable by either party o fraudulent misrepresentation voidable by innocent party elements: misrepresentation of material fact intent to deceive reliance on misinformation injury to innocent party o no proof of injury is required to rescind contract o proof of injury is required to receive damages o undue influence taking advantage of someone who is sick to gain property/money contract lacks voluntary consent and IS voidable if party is presumed weak or talked into doing something not benefitting him/her o duress party who enters into contract under fear/threat. Contract is voidable performance and discharge conditions and performance o a possible future event which will trigger legal obligation or terminate existing contract (I will hire you if you graduate UA in 2016) o condition precedent: condition must be fulfilled before party’s performance can be required discharge by performance o both parties have fulfilled duties as promise under contract complete performance: both parties have completed duties substantial performance: party in good faith perform most of contract, decided on a case to case basis (Jacob & Young V. Kent pipe in house) discharge by agreement o mutual rescission- a new contract to cancel old contract, termination agreement o novation- both parties agree to substitute a new third party for one of the original parties (Bob and Bob’s mom landscaping example) o settlement agreement- pay them to leave contract o accord and satisfaction accord- pay them in terms of property instead of money (if you owe someone $10k you give them your car worth $10k) discharge by law o material alteration- when you alter contract without other party’s consent, can be terminated o bankruptcy- creditor cannot file suit against you when you file for bankruptcy o impossibility of performance- death/incapacitation of party, destruction of subject matter, change in law makes contract illegal o commercial impracticability- performance becomes extremely difficult or costly and not known by parties when contract was made o frustration of purpose- event makes it impossible to attain purpose performance to satisfaction of another o when contract requires personal satisfaction of another o general rule: contracts will be analyzed under “reasonable person” standard breach of contract o material breach of contract – occurs when performance is not substantial o minor breach of contract – duty to perform is not excused and party must resume performance of contractual obligations anticipatory repudiation o before performance is due, one party refuses to perform contractual obligation o treated as material breach, can sue party for damages (lost profits) time for performance o all parties must perform contractual obligation in a “reasonable” amount of time, determined case by case damages for breach compensatory damages o designed to compensate party for loss of bargain o damages actually sustained from breach o standard measure: difference between value of promised performance and actual performance sale of goods: difference between contract price and market price consequential (special) damages o foreseeable losses o ex: beer distributor doesn’t sell beer to sports bar on super bowl Sunday, can sue distributor for foreseeable losses liquidated damages v. penalties o liquidated damages: if you breach this contract you owe me x amount of dollars o penalties: designed to penalize party that breached contract equitable remedies rescission o a contract is canceled and the parties are restored to the original positions that they occupied prior to the transactions restitution specific performance reformation o Equitable remedy allowing a contract to be reformed, or rewritten, to reflect the parties’ true intention Waiver of breach Waiver Non breaching party accepts defective performance of contract
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