- Created by: Majid
- Created on: 12-05-13 17:42
Intro: Discharge of a contract refers to the ending of all contracts. Every contract incurs primary obligations, but it's been stated by Lord Diplock that if these aren't met then secondary obligations arise (i.e. pay damages).
Discharge by Performance - Basic Common Law rule: To discharge a contract by performance, performance must be fully completed for any right to payment i.e. it must be exact and complete.
CASE: "Cutter v Powell". In this case a sailor died shortly before docking to Liverpool from Jamaica. HELD: There was no right to payment, as Cutter hadn't fully performed.
CASE: "Re Moore v Landauer". In this case there was a contract for tinned fruit to be supplied in cartons of 30 tins, but was delivered in 24 tins instead. HELD: The buyer could reject the entire consignment.
However, the Law won't grant a remedy for trivial matters...CASE: "Reardon Smith v Hansen-Tangen". In this case a ship was meant to be built in the Osaka shipyard, but it was full and was built in the Oshima shipyard instead to the same specifications, and the buyer refused to accept the delivery on the grounds it was a breach of a term/condition. HELD: It was a technincal breach with no bearing on the outcome and the buyer couldn't repudiate the contract. - e.g. of a breach of an innominate term.
AO2: It provides certainty in the law as it ensures promises are kept, however it can be a harsh and unfair rule (Cutter v Powell) as it can cause injustice but ensures people perform their part of the bargain properly. As a result of this various excpetions have been created in equity to remedy the harshness (There are 6 exceptions).