carrying out the contract
DESCRIPTION
Chapter 17. Carrying out the Contract. Carrying out the Contract . From chapter 17, we know that once the 5 essential elements are in place and the parties have agreed, a binding contract exists. But how to do contracts come to an end? . Discharging a Contract . - PowerPoint PPT PresentationTRANSCRIPT
![Page 1: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/1.jpg)
Carrying out the Contract
Chapter 17
![Page 2: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/2.jpg)
Carrying out the Contract From chapter 17, we know that once
the 5 essential elements are in place and the parties have agreed, a binding contract exists.
But how to do contracts come to an end?
![Page 3: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/3.jpg)
Discharging a Contract
Once a contract exists, each party has rights and responsibilities. When each side has carried out those responsibilities and the contract is carried out as planned, the contract is discharged.
![Page 4: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/4.jpg)
3 Ways to Discharge a Contract Performance Mutual Agreement Impossibility of Performance
![Page 5: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/5.jpg)
Performance
Fulfilling the obligations of your contract.
Most common way to discharge a contract.
Example:
A painting company completes their job and you pay them the agreed upon amount.
![Page 6: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/6.jpg)
Mutual Agreement
All parties of a contract agree to cancel it.
Might cancel one contract by agreeing on a new contract.
Example:
You are selling your car and already have a contract. But then you remember that you have winter tires and agree to add that in.
![Page 7: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/7.jpg)
Impossibility of Performance Parties of a contract are excused
from performing because of events that make it impossible have occurred after the agreement had been made.
Example:
An outdoor concert is cancelled because of a rainstorm.
![Page 8: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/8.jpg)
Breach of Contract
Opposite of specific performance. Occurs when one party doesn’t finish
its obligations. Breach of condition-important part of the
contract is breached. Breach of warranty-a small part of the
contract is breached.
![Page 9: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/9.jpg)
Substantial Performance
Protects the other side (the person who was breached is protected but the law looks at both sides)
Rule of substantial performance protects a party who has fulfilled most of the contracts but not all of the contract.
![Page 10: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/10.jpg)
Remedies for Breach of Contract Damages Specific Performance Injunctions Rescission
![Page 11: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/11.jpg)
Damages
Damages are awarded to compensate the injured party for any losses.
The intention is not to punish the party that breached the contract but to place the injured party in the same position as if the contract had been completed.
![Page 12: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/12.jpg)
Damages continued…
Mitigation of Loss The courts expect that a person who is injured by a breach of contract to take “reasonable steps” to reduce or prevent any losses that may occur. Liquidated Damages Many contracts include liquidated damages. This is the sum of money that the parties agree to in advance to settle any breach of contract that might occur.
![Page 13: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/13.jpg)
Specific Performance
For a breach of contract, usually damages ($) is enough, but what if it isn’t?
Specific performance The precise terms of the original contract must be honoured. *likely be awarded if the breach involves a one of a kind item **but is not available if the courts would have to supervise the carrying out of the order
![Page 14: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/14.jpg)
Injunctions
Opposite of specific performance. It requires the defendant not to do
something.
Example: Non-competition clause- stops trade or employment to limit competition*reasonable
![Page 15: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/15.jpg)
Rescisson
Rescission returns the parties to their original positions before the contract was formed.
![Page 16: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/16.jpg)
Privity of Contract
In order for an injured party to win a breach of contract, they have to prove privity of contract.
They have to prove that they had a contractual relationship with the defendant.
![Page 17: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/17.jpg)
Limitations of Actions
Injured party has the right to take court action after they have had a breach of contract.
However, the Statute of Limitations states that there are some time limits.
If you don’t do anything within that time, the court will no longer help you enforce it.
![Page 18: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/18.jpg)
Sale of Goods Legislation
![Page 19: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/19.jpg)
Sale of Goods Act
1st legislation to regulate the sale of goods was the 1893 Sale of Goods Act passed by the British Parliament. .
Very specific area of contract law that deals with how sellers transfer the ownership of goods (present or future) to the buyer for monetary consideration.
![Page 20: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/20.jpg)
Sales of Goods Act continued… Barter transactions do not use
money so its not covered by this act. “Goods” only refers to personal
property, such as furniture, clothing, appliances and other movable possessions.
![Page 21: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/21.jpg)
Title, Delivery and Payment
Title The owner of goods has title of the
goods. Most written contracts state when
title passes to the buyer. This matters because the owner
ends up with the loss if the goods are lost, stolen, damaged or destroyed.
![Page 22: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/22.jpg)
Title, Delivery and Payment continued…
Delivery Is the transfer of ownership from
seller to buyer; usually takes place at the sellers place of business.
![Page 23: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/23.jpg)
Title, Delivery and Payment continued…
Payment Most contracts state the time and
method of payment. Sale of Goods legislation states that payment should be made at the time of delivery.
![Page 24: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/24.jpg)
Express Conditions & Express Warranties
Express condition Clearly outlined in the contract and is an
important part of the contract. Express warranties (guarantees) Specific promises that
manufacturers/retailers make to consumers about their products/services: a) Performanceb) Quality c) Condition
![Page 25: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/25.jpg)
Express Conditions & Express Warranties continued… When a contract has an express
warranties (guarantees) any verbal promises the seller makes will not be binding
Exception: If a buyer makes a purchase based only on the advice/information of the seller, those verbal promises can be binding.
![Page 26: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/26.jpg)
Secret Warranties
Specific promise that goods or services will meet certain standards (warranties) that sellers communicate to dealers but not to buyers.
![Page 27: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/27.jpg)
Implied Conditions/Implied Warranties
Promises in law that sellers make to buyers through implication or suggestion.
They include 3 basic promises.
![Page 28: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/28.jpg)
Basic Promises
1. Seller has title to the goods and therefore has the right to sell them.
2. Articles will be of good quality and fit for the buyers use (merchantable quality).
3. The goods a buyer receives are the same as the samples/descriptions provided by the seller.
If they are not the same, the buyer can return them and rescind the contract but it has to be done quickly.
![Page 29: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/29.jpg)
![Page 30: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/30.jpg)
![Page 31: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/31.jpg)
![Page 32: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/32.jpg)
![Page 33: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/33.jpg)
![Page 34: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/34.jpg)
![Page 35: Carrying out the Contract](https://reader034.vdocuments.net/reader034/viewer/2022051219/56816705550346895ddb6a39/html5/thumbnails/35.jpg)
Done notes for today!