Contractual Conditions Explained
Summary
In contract law, a condition precedent must be met before a contract becomes binding, while a concurrent condition requires simultaneous performance by both parties. Anticipatory repudiation occurs when a party indicates they will not fulfill their contractual obligations before the due date. Substantial performance allows for contract fulfillment with minor deviations. Satisfaction clauses permit withholding payment if the work is unsatisfactory, but a reasonable person standard may apply if dissatisfaction is disputed. Rescission can be valid without additional consideration if both parties agree. An accord involves accepting something different from what was originally owed, while a novation replaces an original party with a new one. Bankruptcy can discharge contractual obligations by law. Impossibility of performance discharges contracts when unforeseen events make performance illegal.Full Conversation
Rick agrees to buy twenty acres of land from Tina. Three weeks before the deal is to close, Rick calls Tina and says: “The deal is off!” In this situation, Rick’s actions constitute:
a. substantial performance of the contract.
b. a reformation of the contract.
c. a discharge of the contract by novation.
d. anticipatory repudiation of the contract.
Rick’s actions constitute:
- d. anticipatory repudiation of the contract
Anticipatory repudiation occurs when one party communicates an intention not to perform their contractual obligations before the performance is due.
Would you like more information on the potential legal consequences or next steps for Tina?
- d. anticipatory repudiation of the contract
Anticipatory repudiation occurs when one party communicates an intention not to perform their contractual obligations before the performance is due.
Would you like more information on the potential legal consequences or next steps for Tina?
Johanna agrees to purchase Jessie’s land so that she can build a golf course. They write a contract, and Johanna transfers the deed to Jessie. Jessie pays Johanna the entire purchase price. Johanna and Jessie have discharged their contract by:
a. breach.
b. concurrence.
c. performance.
d. lapse of time.
In this scenario, Johanna and Jessie have discharged their contract by:
- c. performance
Performance occurs when both parties fulfill their contractual obligations. Johanna transferred the deed, and Jessie paid the purchase price, thereby completing the contract.
Do you have any other legal questions or need further clarification?
- c. performance
Performance occurs when both parties fulfill their contractual obligations. Johanna transferred the deed, and Jessie paid the purchase price, thereby completing the contract.
Do you have any other legal questions or need further clarification?
Jim contracted with United Technologies to install *,* feet of Rocketfish Cat-5e network cable in his new office building. United installed *,* feet of Dynex Cat-5e network cable instead. The types of cable are essentially the same. When Jim sued for breach of contract, the court likely found that United’s actions constituted:
a. substantial performance.
b. complete performance.
c. material breach.
d. incomplete performance.
In this scenario, the court likely found that United Technologies' actions constituted:
- a. substantial performance
Substantial performance occurs when a party performs enough of the contract to warrant payment, even if there are minor deviations from the terms. Here, United installed a similar type of cable, meeting the essential terms of the contract.
Would you like to know more about the implications of substantial performance?
- a. substantial performance
Substantial performance occurs when a party performs enough of the contract to warrant payment, even if there are minor deviations from the terms. Here, United installed a similar type of cable, meeting the essential terms of the contract.
Would you like to know more about the implications of substantial performance?
Mateo and Astrid have a contract where Mateo will sell his used Ford Bronco to Astrid for $*,*. They are to trade the vehicle for cash on Tuesday. In this contract there is:
a. a condition precedent.
b. a concurrent condition.
c. a condition subsequent.
d. no condition.
In this scenario, there is:
- b. a concurrent condition
A concurrent condition is when the parties involved must perform their obligations at the same time. In this case, Mateo is to deliver the vehicle, and Astrid is to provide the cash simultaneously.
Is there something else you need help with?
- b. a concurrent condition
A concurrent condition is when the parties involved must perform their obligations at the same time. In this case, Mateo is to deliver the vehicle, and Astrid is to provide the cash simultaneously.
Is there something else you need help with?
Shaina hires Kieran to take her senior pictures and touch them up “subject to Shaina’s satisfaction.” Kieran takes the pictures and touches them up, but Shaina is legitimately unhappy with the work. Shaina:
a. has to pay Kieran for the work if the work would satisfy a reasonable person.
b. has to pay Kieran for the work because Kieran completed the work and “approval” clauses are illegal.
c. does not have to pay Kieran for the work.
d. does not have to pay Kieran for the work because the contract is void.
In this scenario, option (c) is the most accurate answer. Shaina does not have to pay Kieran for the work.
- The contract's satisfaction clause allows Shaina to withhold payment if she is not satisfied with the work, provided her dissatisfaction is genuine and not arbitrary.
Do you have any further questions or need more details on this topic?
- The contract's satisfaction clause allows Shaina to withhold payment if she is not satisfied with the work, provided her dissatisfaction is genuine and not arbitrary.
Do you have any further questions or need more details on this topic?
Shaina hires Kieran to take her senior pictures and touch them up “subject to Shaina’s satisfaction.” Kieran takes the pictures and touches them up. Shaina is legitimately happy with the work, but spent the money she was going to use for the pictures on other things, and claims that she is not happy with the work. If there is evidence of this, Shaina:
a. has to pay Kieran for the work if the work would satisfy a reasonable person.
b. has to pay Kieran for the work because Kieran completed the work and “approval” clauses are illegal.
c. does not have to pay Kieran for the work.
d. does not have to pay Kieran for the work because the contract is void
Based on your scenario, the appropriate answer would be:
a. has to pay Kieran for the work if the work would satisfy a reasonable person.
If there is evidence that Shaina is happy with the work but is claiming dissatisfaction to avoid payment, the "reasonable person" standard would likely apply. This means she would need to pay if a reasonable person would find the work satisfactory.
Would you like to know more about how to proceed legally in this situation?
a. has to pay Kieran for the work if the work would satisfy a reasonable person.
If there is evidence that Shaina is happy with the work but is claiming dissatisfaction to avoid payment, the "reasonable person" standard would likely apply. This means she would need to pay if a reasonable person would find the work satisfactory.
Would you like to know more about how to proceed legally in this situation?
Shaina hires Kieran to take her senior pictures and touch them up “subject to Shaina’s satisfaction.” Kieran takes the pictures and touches them up. Shaina is legitimately happy with the work, but spent the money she was going to use for the pictures on other things, and claims that she is not happy with the work. If there is evidence of this, Shaina:
a. has to pay Kieran for the work if the work would satisfy a reasonable person.
b. has to pay Kieran for the work because Kieran completed the work and “approval” clauses are illegal.
c. does not have to pay Kieran for the work.
d. does not have to pay Kieran for the work because the contract is void
In your scenario, the appropriate answer is:
a. Shaina has to pay Kieran for the work if the work would satisfy a reasonable person.
If there is evidence that Shaina is actually happy with the work but is claiming dissatisfaction to avoid payment, the "reasonable person" standard applies. This means she would need to pay if a reasonable person would find the work satisfactory.
Would you like to know more about how to proceed legally in this situation?
a. Shaina has to pay Kieran for the work if the work would satisfy a reasonable person.
If there is evidence that Shaina is actually happy with the work but is claiming dissatisfaction to avoid payment, the "reasonable person" standard applies. This means she would need to pay if a reasonable person would find the work satisfactory.
Would you like to know more about how to proceed legally in this situation?
Shane and Diego have a signed contract for Shane to sell Diego some property in the mountains. Shane decides that he does not want to sell the property. Diego also decides that he does not want to buy the property. They meet to discuss it and agree, in writing, to rescind the contract. The rescission:
a. must have additional consideration in order to be valid.
b. is not valid because land deals cannot be rescinded.
c. is not valid because rescissions must be oral.
d. is supported by the promises not to enforce the original contract.
Option (d) is correct. The rescission of the contract is supported by the promises not to enforce the original contract. In California, a mutual agreement to rescind a contract is valid without the need for additional consideration, as long as both parties agree in writing.
Would you like to know more about contract rescission or any other legal matter?
Would you like to know more about contract rescission or any other legal matter?
Vince owes Colton $*,* under a previous contract. Vince does not have the money but does own property worth approximately $*,*. Colton agrees to accept the property instead of the money and Vince transfers the property to him. The transfer is called:
a. a novation.
b. a satisfaction.
c. an accord.
d. a rescission
The transfer is called:
- b. a satisfaction
Satisfaction occurs when a party fulfills an obligation by giving something other than what was originally agreed upon, provided the other party agrees to accept it. This is common in debt settlements where property is accepted instead of cash.
Do you have any other legal questions or need further clarification?
- b. a satisfaction
Satisfaction occurs when a party fulfills an obligation by giving something other than what was originally agreed upon, provided the other party agrees to accept it. This is common in debt settlements where property is accepted instead of cash.
Do you have any other legal questions or need further clarification?
Vince owes Colton $*,* under a previous contract. Vince does not have the money, but does own property worth approximately $*,*. Colton agrees to accept the property instead of the money. This is:
a. a rescission.
b. a satisfaction.
c. a novation.
d. an accord
This scenario represents an accord. An accord is an agreement in which one party agrees to accept something different from what was originally owed. Here, Colton agrees to accept property instead of money, which constitutes an accord.
Would you like to know more about the legal implications of an accord?
Would you like to know more about the legal implications of an accord?
Tiffany owns a health club and contracts to buy a set of weights from Dylan for $*,*. Dylan is hurting financially, so he changes the dollar amount on the contract to $*,*. Before delivering the weights, Dylan attempts to collect the $*,* from Tiffany, who accuses him of trying to cheat her. She has a copy of the contract with the original amount. When they end up in court, the court likely:
a. will enforce the contract for the original dollar amount.
b. will enforce the contract for $*,*.
c. will not enforce the contract because there is a disagreement about the dollar amount.
d. will not enforce the contract at all because of the change made by Dylan.
The court will likely:
- a. will enforce the contract for the original dollar amount.
Dylan's unauthorized change to the contract is considered fraud or alteration, making the original terms enforceable.
Do you need more details on how Tiffany can proceed with this case?
- a. will enforce the contract for the original dollar amount.
Dylan's unauthorized change to the contract is considered fraud or alteration, making the original terms enforceable.
Do you need more details on how Tiffany can proceed with this case?
Kyle has a credit card with a contract stipulating that he will make monthly minimum payments. Over the course of a year, he incurs $*,* in debt that he can’t pay. Because of this and other debts, Kyle files for bankruptcy. In the bankruptcy, Kyle’s assets are distributed to his creditors, and the credit-card company gets $*. The bankruptcy process:
a. discharges the contract by performance.
b. discharges the contract by agreement.
c. does not discharge the contract.
d. discharges the contract by law.
In Kyle's scenario, the correct answer is:
- d. discharges the contract by law
When Kyle files for bankruptcy, his obligations under the credit card contract are typically discharged by law, meaning he is no longer legally required to pay the remaining debt.
Would you like more information on the bankruptcy process or its consequences?
- d. discharges the contract by law
When Kyle files for bankruptcy, his obligations under the credit card contract are typically discharged by law, meaning he is no longer legally required to pay the remaining debt.
Would you like more information on the bankruptcy process or its consequences?
Putnam Corporation makes a sleeping pill that is legally sold in the United States. Putnam has a contract with a chain of pharmacies to provide *,* cases of the sleeping pill for retail sale. One month after the contract is signed, but before any pills have been delivered, the Food and Drug Administration passes regulations that make it illegal to buy or sell the drug because it is highly addictive and has caused high levels of abuse, as well as a few deaths. Can the pharmacy chain get out of the contract?
a. Yes, because the government’s actions make it impossible to perform.
b. Yes, because performance may lead to unethical results.
c. No, because the law did make it impossible to perform, it simply increased the consequences of performance.
d. No, because the law has no impact on the legality of the contract.
The pharmacy chain can get out of the contract because the government's actions make it impossible to perform. This situation falls under the legal doctrine of "impossibility of performance," which discharges both parties from their contractual obligations when unforeseen events render the contract's performance illegal.
Would you like more information on how to proceed with this contract issue?
Would you like more information on how to proceed with this contract issue?
Eric and Chelsea sign a contract where Eric will sell his used car to Chelsea for $*. That night, Chelsea’s parents surprise her with a new car. Chelsea’s friend, Andrea, needs a new car. Andrea, Chelsea, and Eric sit down the next day and cross off Chelsea’s name on the contract and write in Andrea’s name. All three of the parties initial the changes. This is:
a. a satisfaction.
b. a novation.
c. an accord.
d. a rescission.
This situation represents:
- b. a novation
A novation occurs when the original party to a contract is replaced with a new party, and all parties involved agree to this substitution. In this case, Andrea replaces Chelsea in the contract with Eric's agreement, making it a novation.
Is there anything else you'd like to know about novation or related topics?
- b. a novation
A novation occurs when the original party to a contract is replaced with a new party, and all parties involved agree to this substitution. In this case, Andrea replaces Chelsea in the contract with Eric's agreement, making it a novation.
Is there anything else you'd like to know about novation or related topics?
Bill and Henry sign a contract for Bill to build a house for Henry by December *. On December *, the house is complete with the exception of the crown molding around the living room ceiling and a final coat of interior paint. In the meantime, Henry has decided that he does not want a new home. He tells Bill that Bill has breached the contract and Henry no longer is obligated to perform. Is Henry correct?
a. Yes, because Bill can always sell the home to someone else after it is finished.
b. No, because Bill substantially performed.
c. No, because Bill perfectly performed.
d. Yes, because Bill breached the contract by not having the home completed on time.
Henry is not correct. The best answer would be:
- b. No, because Bill substantially performed.
Substantial performance means that Bill has completed the majority of the work, fulfilling the main purpose of the contract. Minor details like crown molding and final paint do not constitute a material breach.
Would you like more information on substantial performance or how to proceed legally in this situation?
- b. No, because Bill substantially performed.
Substantial performance means that Bill has completed the majority of the work, fulfilling the main purpose of the contract. Minor details like crown molding and final paint do not constitute a material breach.
Would you like more information on substantial performance or how to proceed legally in this situation?