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Contract: Discharge

Discharge by breach, actual and anticipatory

  • 3 things to know
  • A2 Units 3 and 4

Overview

Breach of contract, repudiatory breach and actual breach.

What you need to know

Answer each one before you reveal it.

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Key term

What are the consequences of affirming a contract after a repudiatory breach?

Key term

What is an actual breach?

Key term

What did Hochster v De La Tour (1853) decide?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    What is a breach of contract?

    Model answer

    A breach occurs where a party fails without lawful excuse to perform an obligation under the contract, performs it defectively, or declares in advance that it will not perform.

  2. 2

    Does every breach of contract discharge the innocent party from further performance?

    Model answer

    No, only a repudiatory breach gives that right, and a breach of a minor term leaves both parties bound to continue while giving the innocent party a claim in damages.

  3. 3

    What is a repudiatory breach?

    Model answer

    A repudiatory breach is a breach of a condition, or a breach of an innominate term so serious that it deprives the innocent party of substantially the whole benefit of the contract.

  4. 4

    What election does a repudiatory breach give the innocent party?

    Model answer

    That party may accept the repudiation, terminate the contract and sue for damages, or may affirm the contract, keep it alive for both sides and sue for damages instead.

  5. 5

    What are the consequences of affirming a contract after a repudiatory breach?

    Model answer

    The contract continues in force for both parties, so the innocent party must still perform its own obligations and loses the right to terminate for that breach.

  6. 6

    What is an actual breach?

    Model answer

    An actual breach occurs at or after the time fixed for performance, where a party fails to perform, performs late or performs defectively.

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