Discharge by Breach

What is breach?

When a party fails to fulfill contractual obligations.

If there is breach, C will always be able to claim damages but terminating the contract depends on the type of breach.

What are the types of breach?

1. Actual Breach

2. Anticipatory Breach

1. Actual Breach

Under Actual Breach, the C has 3 options:

• Continue with the contract and sue for damages

• Repudiate the contract

• Repudiate and claim for damages.

The 2nd and 3rd options are only available if it is a breach of condition. Rice v Great Yarmouth.

2. Anticipatory Breach

Demonstrated in Hochester v De La Tour: C was told in advance he could no longer work as a courier.

This is when the party is told in advance that the other party will not complete their contractual obligations.

Here, there are 2 options:

1. Sue for breach immediately

• Gelden Operations Ltd v Dry Bulk Handy Holdings

• This will not work if they were unsure whether there would be a breach.

2. Wait until the contract should have been fulfilled and then sue.

• (This is a dangerous approach in case something happens in the meantime, such as frustration, meaning it is no longer breach.)

What are the remedies for breach?

Actual Breach:

• Breach of condition = damages + repudiation

• Breach of warranty= just damageS

Anticipatory Breach:

• Damages (taking into account matters like inflation) and repudiation (Repudiation is only valid for breach of condition)