Discharge of contracts. Law of Contract LW1154 BCL 2005-2006. Books. Clark chapter 18 McDermott chapters 19-21. Introduction: When is performance due?. The problem . Suppose a contract has been made … … and one party is concerned that the other might not perform
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Law of Contract
… and one party is concerned that the other might not perform
… then we must determine the relationship between the two performances
Sale of Goods Act 1893 s 28 Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, that is to say, the seller must be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer must be ready and willing to pay the price in exchange for possession of the goods.
Avoidance of the rule:
Rights which were to arise after the time of discharge never arise at allEffect of discharge for breach?
The contract is valid up to the point of discharge, but no further
But the pilot mis-timed his flight, and advertised during a Remembrance day 2-minute silenceExample 3Aerial Advertising v. Batchelor’s Peas 2 All ER 788
… but got very bad publicity instead
Therefore they were entitled to treat the contract as dischargedExample 3Aerial Advertising v. Batchelor’s Peas 2 All ER 788
What factors are relevant in classifying the term?
But sometimes silence can only mean one thing …
… and so silence can sometimes amount to an exercise of the right eg The Santa Clara AC 800Can the right be exercised by silence ?
eg contract of employment ...
In both these cases, the innocent party may escape the contract
The Supreme Court held that she was not in anticipatory breach:
“If ... a consideration of the terms of the contract, in the light of the circumstances existing when it was made, shows that they never agreed to be bound in a fundamentally different situation which has now unexpectedly emerged, the contract ceases to bind at that point — not because the court in its discretion thinks it just and reasonable to qualify the terms of the contract, but because on its true construction it does not apply in that situation” (British Movietonenews v. London Cinemas  AC 166)