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Contract: Discharge of Contract

Discharge by actual breach

  • 3 things to know
  • Components 2 and 3

Overview

Breach of contract and repudiatory breach.

What you need to know

Answer each one before you reveal it.

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Key term

What is a breach of contract, and when does it entitle the injured party to terminate?

Key term

What is a breach of contract?

Key term

Does every breach discharge the contract?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    What is a breach of contract?

    Model answer

    A breach of contract is a failure to perform an obligation without lawful excuse. Breach may be complete failure, late performance or defective performance.

  2. 2

    Does every breach discharge the contract?

    Model answer

    A breach does not automatically discharge the contract. Only a repudiatory breach gives the injured party the right to terminate.

  3. 3

    What is a repudiatory breach?

    Model answer

    A repudiatory breach is one that deprives the injured party of substantially the whole benefit of the contract. Breach of a condition is repudiatory whatever its actual consequences.

  4. 4

    What choice does a repudiatory breach give the innocent party?

    Model answer

    The innocent party may terminate the contract and claim damages, or affirm and require performance. The choice must be made within a reasonable time.

  5. 5

    What is the effect of terminating for repudiatory breach?

    Model answer

    Termination brings the parties' future obligations to an end. Rights that had already accrued before termination survive.

  6. 6

    How did Photo Production Ltd v Securicor Transport Ltd [1980] explain termination?

    Model answer

    Photo Production Ltd v Securicor Transport Ltd [1980] explained that termination ends the primary obligations. A secondary obligation to pay damages replaces them.

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