BREACH OF CONTRACT

WHAT IS BREACH OF CONTRACT?

  • party fails to perform terms of contract

  • party states in advance that they will not perform as agreed

  • ultimately breaking a promise- in contract :OBLIGATION

a. ANTICIPATORY BREACH OF CONTRACT

One party indicates that they will not be performing the contract (or can’t) before the date of performance. A party can sue at once or wait for the date of performance.

Better to sue instantly (frustrating event could happen otherwise)

HOCHESTER V DE LA TOUR

H agreed to work as a courier on a tour due to start in June. Company told him in May they no longer needed his services. In that situation, he was entitled to sue immediately and didn’t have to wait until the actual breach of contract, which would have occurred in June.

Innocent party can 1. repudiate the contract (released from future obligations and no longer bound)

AND (if lost money) 2. claims damages (puts them in the position they would have been in had the contract been performed

AVERY V BOWDEN

C was to carry cargo for D, C arrived early to collect cargo and D told them to sale on as they didn’t have any cargo for them to carry and would not have by the agreed date. C decided to wait around in hope D would be able to supply some cargo. However, before the date the cargo was supposed to be shipped the Crimean war broke out meaning contract became frustrated. C therefore lost their right to sue for breach. Had they brought their action immediately they would’ve had a valid claim.


a. ACTUAL BREACH OF CONTRACT

Is it a SERIOUS breach?

  • breach of condition and C can ask for repudiation and damages

  • POUSSARD V SPIERS

  • s9,s10,s11 of CRA if broken constitute a condition (s31)

Is it a MINOR breach?

  • treat as a breach of warranty and c can claim damages only

  • BETTINI V GYE

Innominate term- INTERMEDIATE TERM so wait to see consequences of the breach and how serious they were HONG KONG SHIPPING

There has been a failure to perform the contract. If a repudiatiory breach of contract is established, the other party who is not in breach may terminante the contract and claim damages or continue the contract and claim damages (breach must be very serious). Repudiatory breach can occur in 3 ways:

  • breach of condition

  • a refusal to perform contract

  • a serious breach of an innominate term that would be considered a breach of condition.

EUROCROSS FROZEN FISH V GALBA IMPEX

Cs made a contract with D’s to buy a large quantity of frozen fish from D’s with full payment to be made on receipt of fish. Cs received the fish. Cs paid the money. Then Cs realised that only 23/200 cartons had been received (+550 cartons were received which they had not ordered). Cs sued for BoC and won.