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  • Created by: Launston
  • Created on: 14-05-14 12:15
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  • Discharge
    • Performance
      • If performance is defective, this may lead to a breach depending on whether the obligations are strict or qualified
    • Agreement
      • Express Provision - contract will come to an end after a certain time - insurance contract
        • Charterparties give right to cancel if ship not delivered on time - Mihalis Angelos
      • Release and Abandonment - must be objective agreement and consideration
        • Mutual agreement is good consideration
          • If one party has performed obligations the other must provide new consideration - The Hannah Blumenthal
    • Breach
      • Remedy depends on terms of contract and importance of term
        • Loss caused by breach must not be too remote and is not excluded by contractual terms, damages can be claimed
          • Only certain circumstances allow for termination of the contract - this is a serious matter
    • Classification of Terms
      • Conditions, warranties or innominate terms
        • Breaches of different terms affect remedies which can be claimed
        • Advantages and disadvantages of conditions
          • Right to elect to terminate from the moment the breach occurs - certainty
          • Right to terminate may be harsh if the consequences of the breach are not very grave - less flexible than innominate terms
      • Statute
        • Sale of Goods Act implies conditions into contracts
      • Authority
        • Time for performance in commercial contracts - Mihalis Angelos
          • Bunge Corporation v Tradax - particularly if other party's perfomance dependent on time
      • Parties
        • Use of term 'condition' is not conclusive
          • Schuler v Wickman
            • Court would not allow termination for such a trivial breach
              • Courts undermining freedom of contract
        • If parties have not classified, courts will still seek to give effect to intentions
          • The Seaflower
      • Innominate Terms - Hong Kong Fir - nreach could be trivial or fundamental
        • Sports Connection
          • Consequences of the breach must be assessed (loss of whole benefit under the contract) - uncertainty
            • Party has to wait and see consequences - bad position if vessel cannot be used for period of time - affect planning - would not know how long to charter a substitute - cannot terminate to get a better bargain
    • Termination
      • Not an automatic process - must ELECT to affirm or terminate
        • Must communicate this to other party - Vitol v Norelf
          • The reasons for termination are not relevant - may wish to escape bad bargain - Mihalis Angelos
            • If no communication of termination is given, the contract will be affirmed
      • Effects of termination
        • Both parties discharged from performance of primary obligations
          • Secondary obligation to pay damages - Photo Production v Securicor
            • Irrevocable - cannot change mind
              • Both parties liable for other breaches which occurred prior to fundamental breach
                • Must make sure there is a right to terminate or they will be in breach
    • Affirmation
      • Both parties must continue to perform contract - White and Carter
        • Party in breach will be liable for damages
          • Both parties liable for previous breaches
            • Irrevocable unless party in breach persists with non-performance
              • Johnson v Agnew
              • Party in breach may show innocent party has no legitimate interest in continuing contract
                • The Dynamic
    • Anticipatory Breach
      • Can terminate immediately - Hochster v De La Tour


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