Chapter 17 textbook flashcards

Condition

An event whose occurrence or nonoccurrence affects a duty of performance.

Express Condition

A contingency explicitly set forth in the contract language.

Subjective Satisfaction

A condition where approval is based on a party's honestly held opinion.

Objective Satisfaction

A condition where approval is based on whether a reasonable person would be satisfied.

Satisfaction of a Third Party

A contract may require the approval of a third party for performance to be deemed complete.

Implied-in-Fact Conditions

Contingencies understood by the parties as part of the agreement, though not explicitly stated.

Implied-in-Law Conditions

Contingencies imposed by law to ensure fairness, also called constructive conditions.

Concurrent Conditions

Conditions that must occur at the same time for performance to be due.

Condition Precedent

An event that must occur before performance under a contract is due.

Condition Subsequent

An event that terminates an existing duty of performance.

Discharge by Performance

The fulfillment of a contractual obligation, leading to termination of the contractual duty.

Tender

A party's offer to perform their obligation according to contract terms.

Breach of Contract

The wrongful failure to perform contractual obligations, leading to possible damages.

Material Breach

A significant failure to perform that discharges the injured party from further obligations.

Prevention of Performance

When one party substantially interferes with the other's performance, constituting a material breach.

Perfect Tender Rule

Under the UCC, a seller's performance must strictly comply with contract terms, and any deviation allows rejection.

Substantial Performance

Performance that is incomplete but still fulfills the essential purpose of the contract, entitling the injured party to damages.

Anticipatory Repudiation

When a party refuses to perform before the performance is due, allowing the other party to sue immediately.

Unauthorized Material Alteration

A fraudulent alteration of a contract by one party, which discharges the entire contract.

Mutual Rescission

An agreement between parties to terminate their contractual obligations.

Substituted Contract

A new contract that replaces an existing contract and discharges prior obligations.

Accord and Satisfaction

A substituted performance (accord) and its execution (satisfaction), which discharges the original duty.

Novation

A substituted contract involving a new third-party promisor or promisee.

Impossibility of Performance

When performance cannot be done due to unforeseeable circumstances.

Objective Impossibility

When no promisor is able to perform, leading to contract discharge.

Subjective Impossibility

When a specific promisor cannot perform, but others could; does not discharge the contract.

Destruction of Subject Matter

If the subject matter is destroyed without fault, the contract is discharged.

Subsequent Illegality

If performance becomes illegal due to a change in law, the contract is discharged.

Frustration of Purpose

When the main purpose of the contract cannot be fulfilled due to unforeseen events.

Commercial Impracticability

When performance is only possible under extreme and unforeseen hardship, leading to discharge.

Bankruptcy

A legal discharge of contractual obligations when a debtor complies with bankruptcy laws.

Statute of Limitations

A time limit within which legal action must be taken; after it expires, obligations are not discharged but cannot be enforced in court.