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71 Cards in this Set

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Of a contract involves the legally valid termination of a contractual Duty. All discharge the parties have fulfilled their agreement, at this time, the parties duties and obligations to each other end. There are four main categories of methods for discharging contracts

Four main categories of methods for discharging contracts

Discharge by performance, discharged by agreement of the parties, discharge by operation of Law, and discharged by non-performance


Is a method for enforcing Rights created by the breach of a contract. After a breach occurs, remedies attempt to satisfy the parties expectations when the contract was formed

Two main categories of remedies

Those resulting from a court exercise of its powers at law, legal remedies, and those arising from a Court's use of its powers of equidity, Equitable remedies.

These types of Remedies usually are mutually exclusive.

Equitable remedies

Are designed to provide fairness when there was no substitute remedy, at law.

Perfect Tender

Under discharged by performance subcategory complete performance also known as perfect tender. It is the simplest and most satisfactory method of discharging a contract.


Is an unconditional offer to perform a contractual obligation by a party who has the ability to perform. That person will have completely performed the contract you have the other person does not accept the item or the payment

Substantial performance, discharge by performance

Substantial performance is less than perfect performance that complies with the essential portions of the contract. The injured party can sue for damages resulting from minor deviations, there has been substantial as opposed to complete performance. The doctor is only applicable to non-material and non wilful breaches

Release, discharge by agreement of the parties

The surrender of a legal claim. Release requires a writing, consideration, and an immediate relinquishment of Rights or claims owed to another.

Novation, discharged by agreement of the

A contract that affects an immediate discharge of a previously existing contractual Duty, creates a new contractual Duty or obligation, and includes as a party to this new agreement one who neither was owed a duty nor was obligated to perform in the original contract. The scent of the promise Eve and the new promise or required. Novation differs from an accord and satisfaction in that it affects an immediate discharge of an obligation rather than it discharge after subsequent performance. Novation also differs from an accord because it introduces a new party to the agreement.

Accord and satisfaction, discharge by agreement of the parties

An agreement whereby the parties decide to accept performance different from that required by their original bargain in the parties later compliance with the new agreement. Actual agreement and subsequent performance is necessary

Rescission, discharge by agreement of the parties

The voluntary, Mutual surrender and discharge of contractual rights and duties whereby the parties are returned to the original status quo. Rescission may be either written or oral subject to the statute of frauds, formal or informal, Express or implied.

Complete performance, discharge by performance

Fulfillment of the exact terms of the contract. Complete Performance Based on completion of the contract by the tender of delivery and or payment

Bankruptcy, discharge by operation of law

A court decree or discharge of the debtor's contractual obligations. The obligation can be revived and if it is done in compliance with applicable statutory provisions

Statute of limitations, discharge by operation of law

A definite statutory time. During which the plaintiff must commence a lawsuit or B barred forever the applicable time periods differ from state-to-state.

Material alteration of the contract, discharge by operation of law

A serious change in the contract affected by a party to the contract. The alteration must be done intentionally and without the consent of the other party.

Impossibility, discharged by non-performance

An unforeseen event or condition that precludes the possibility of the party's performing as promised. Discharge stemming from only objective as opposed to subjective impossibility. It includes such events as the destruction of the contract subject matter without the fault of either party, supervening illegality, the death or disability of either party whose personal performance is essential in the contract, and conduct by one party that makes performance by the other party and possible.

Commercial frustration, discharged by non-performance

The destruction of the essential purpose and value of the contract. Destruction of the value of the contract brought about by a supervening event not reasonably anticipated at the contracts formation. The term commercially impracticable is used in the UCC

Breach, discharged by non-performance

The non-performance of obligation set up by the contract.

A. Complete or actual breach.

B. Anticipatory breach, and unequivocal indication by one of the Contracting parties that he or she does not intend to abide by the terms of the contract at the time for performance.

A party's failure to perform a duty which is material and essential in the agreement, the other party is Justified in treating the agreement as at an end. Anticipatory breach is included in both the common law and the UCC.

Conditions, discharged by non-performance

Limitations or qualifications placed on a promise.

A. Express conditions, who's in which the party's explicitly or implicitly set out as limitations to their promises.

C. Condition precedent, the occurrence of a particular event is required before the parties have an obligation to perform, failure of the event discharges the obligation of both parties.

B. Constructive conditions, those red into the contract or implied in Law and Order to serve Justice.C. Condition precedent, the occurrence of a particular event is required before the parties have an obligation to perform, failure of the event discharges the obligation of both parties.D. Condition subsequent, the occurrence of the particular event that cuts off all ongoing contractual duties and discharges the obligation of both parties. Strict compliance with Express conditions necessary to avoid a breach. Substantial compliance with constructive conditions is necessary to avoid a breach.

D. Condition subsequent, the occurrence of the particular event that cuts off all ongoing contractual duties and discharges the obligation of both parties.

Strict compliance with Express conditions necessary to avoid a breach. Substantial compliance rule: with constructive conditions is necessary to avoid a breach.

Commercial impracticable

To excuse non-performance in cases of severe shortages of raw materials going to war, embargo, local crop failure, and other similar reasons.

Complete breach

A complete actual breach involves non-performance of a Duty that is so material and essential to the agreement that the other party is Justified in treating the agreement as at an end

Anticipatory breach, or anticipatory repudiation

A situation one of the Contracting parties will indicate an advance or words or conduct that he or she does not intend to abide by the terms of the agreement.


The inability to pay one's death as they become due.

Affirmative defense

Which means that the defendant must raise the statute of limitations issued to avoid liability under the contract. The court will not ask the party's weather the claim is barred by the statute

Objective impossibility

No one could perform the contract in these circumstances, non-performance of the contract is unavoidable. Unforeseen event or condition that precludes a party from performing as promised. I come out to your house for incense of objective as possible bility involving the death or disability of either party to a personal service contract.

Subjective impossibility

Princess of non-performance owing to personal and possibilities. As opposed to objective impossibility will not discharge contractual obligations.

Force majeure clause

Applause is a contract clause that excuses performance and discharges the contract upon the occurrence of certain external events beyond the control of the party these Clauses are normally restricted to Natural currents such as floods or earthquakes when they include other systems events that are not expected to occur but are designated by the parties as it's using performance if they do occur.

Mutual rescission for rescission

The parties May find it advantageous to call off your deal. Mutual rescission is a voluntary, Mutual surrender and discharge of contractual rights and duties whereby the parties return to the original status quo. A valid rescission is legally binding. In general decision maybe horrible or informal, Express surprise, and written her oral. Mutual agreement to cancel rescission means an Express rescission has occurred

Frustration of purpose

Or otherwise known as commercial frustration has developed as a justification for non-performance. Because of the harshness of the general rule that impossibility ordinarily will not discharge the performance call for in a contract the doctrine of commercial frustration / for stration of purpose was developed.

Concurrent conditions

Obligate the parties to perform at the same time.


The condition must occur before the promise or has a duty to perform or to refrain from performing. Chords classify conditions in two ways. The first classification scheme emphasizes the timing of the condition in relation to the promised performance this three subsets of this classification include conditions precedent, can current conditions, and condition subsequent. The second classification scheme stands from the manner in which the condition arise conditions create by the agreement of the parties themselves are called Express conditions. Conditions created by law ordained constructive or implied conditions

Condition precedent

Condition to contract

The occurrence of the condition is required before the duty to perform is activated. If condition then I will perform for example if I am able to sell my current home by February 3rd I will buy your house as agreed and a fawn the greed price. Failure inability to sell the current home the condition negates obligation to buy the home.

Condition concurrent

Contract X condition

The parties are expected to perform simultaneously and the failure of Wonder perform excuse the obligation of the other to perform

Condition subsequent

Contract X condition the occurrence of the condition will excuse a duty to perform that would otherwise be enforceable I will perform and less condition for example I will sell you my textbook for business law and the end of the semester and less I have to repeat the class. The seller has a duty to sell the book at the end of the semester but that Duty will be negated if he or she does not pass the class and has to retake it the condition.

Express conditions

For example payment of cash is necessary to finalize the sale. Express conditions are spelled out by the parties explicitly

Constructive condition

Is one knot Express by the parties rather read into the contract in order to serve Justice that is the condition is implied in law differentiating between the type of conditions can be difficult


Or minimize damages suffered by the plaintiff. They may choose to seek remedies and equidity. These are designed to provide fairness to the non-breaching party by requiring the breaching party to do or to refrain from doing something ordered by the court


When one party breaches a contract and the other party is entitled to payment for lost expectations.

Compensatory damages

Or those sums of money that will place the injured party in the same economic position that would have been achieved had the contract been performed. Such damages are also called actual damages. Injured parties May recover only the damages at the parties reason we can foresee

Damages awarded to a non-breaching party in order to compensate him or her for the actual foreseeable harm or loss caused by the breach

Direct damages

Compensatory damages include all damages directly attributed the loss of the bargain agreement on by the parties including lost profits and any incidental expenses incurred as a result of the breach.

Consequential damages

Indirect or special damages springing from the effect or aftermath, the consequences, of the breach itself, not recoverable unless a breaching party knew or should have known at the time of contract formation of the potential effect of a breach on the non-breaching party.

Legal remedies

Damage resulting from a Court's exercise of its power at law to award money for losses.

A. Compensatory damages

B. Consequential damages

C. Punitive damages

D. Nominal damages

Punitive damages

Monetary damages awarded to punish a party for willful wanton and malicious harm caused to a non-breaching party. These damages are often relatively large in comparison to the actual damages suffered. Of Damages are rare in contract disputes.

Nominal damages

Small sums that recognize that the plaintiff had a cause of action but the plaintiff proved no measurable Financial loss

Equitable remedies

Remedies arising from a Court's use of its Power of Equality, the remedies can be granted by a court of equity or a court sitting in equidity.

A. Rescission and restitution.

B. Specific performance.

C. Reformation.

D. Injunction.

E. Quasi contract

Rescission and restitution

A court-ordered counseling a contract and ordering the return of the consideration already transferred or its value.

Specific performance

A court order to furnish the performance promised in the contract


A court order correcting an agreement to conform to the intentions of the party


A court order requiring a person to perform an act or restraining a person from doing some Act

Quasi contract

A court order requiring that a person who received a benefit pay for the benefit received so as to prevent his or her unjust enrichment at the expense of the other party. Quasi contract may not be concerned Equitable remedy depending on the state and the specific circumstances.


Is the purchase of replacement Goods to substitute for those promised in the contract.

Spillover damages

Consequential damages are those indirect or special damages sometimes viewed as spillover damages spring from the effects or aftermath that is the consequences of a breach itself.

Treble damages

A statutory remedy that allows the successful plane of trickery Cover 3 times damages suffered as a result of the injury.

Speculative damages

Judge will not award purely speculative damages if they could not prove that the defendant should have known

Indirect damages

Consequential damages are those indirect or special damages sometimes viewed as spillover damages springing from the effects or aftermath that is a consequences of the breach itself


Is a covenant where the promise or undertakes a duty to do something or refrain from doing something.

Liquidated damages clause

The parties may agree in advance that upon breach of contract a certain sum of money will be paid to the injured party. This agreement is called liquidated damages Clause. The amount to which the parties have agreed fully satisfies any liability for the state of breach

De novo

In adinova appeal review the court of appeals used as a trial Court's record makes an independent review of the law and facts. The courts continue to develop This legal


Penalties consist of amounts unrelated to the possible damage that may occur and usually are excessively large. Courts will not enforce the penalty even if the parties have agreed to it and a liquidated damages clause

Unclean hands

Has shown bad faith or dishonesty and dealing with the other party if there is latches the injured party has unduly delayed bringing a lawsuit if a forfeiture of property the loss of property without compensation roll result from conferring and Equitable decree if the court itself necessarily will have to supervise the completion of the remedy granted or if a remedy at law is available determinable and adequate

Mutually exclusive remedies

To avoid the unjust enrichment of the breaching party the law permits restitution by allowing the plaintiff to Sue and quasi contracts in order to recover. In most jurisdictions one cannot see if we're both damages and restitution damages and restitution or mutually exclusive remedies.


Is the process by which the parties are returned to their original positions at the time of contract formation. Involves return of goods money and property involved in the contract or the recovery of the reasonable value of the services rendered.

Election of remedies Doctrine

Prevents from recovering twice

Unjust enrichment

When the parties have not entered into a contract but one party not only has received a benefit to which he or she is not entitled and unjust enrichment has occurred

Waivers of breach

What an injured party gives up the right to receive the performance set out in a contract it is a waiver of breach. Once a waiver of breach occurs waiver and effect eliminates of breach

Liquidated damages clause, right to damages specified in the contract

A provision in the contract that a stated sum of money or property will be paid or forfeited if previously deposited if one of the parties fails to perform in accordance with the contract clause is generally enforceable by a court unless it is unreasonable.

Mitigation Of damages, do to minimize damages

Then on bridging party duty to reduce the actual loss if he or she is able to do so. If an operation party fails to minimize losses he or she cannot recover for the losses that could have been avoided

Mutual rescission, right to terminate a contract without liability

Anagram of the parties to cancel a contract and return the consideration they have received

Waiver of breach, promise or abandoned or relinquishes a legal right

A party relinquishes repudiation or Surrender of a right that he or she has to seek a remedy for breach of contract


Either complete or substantial performance ordinarily discharges the contract.

The parties may agree to discharge of contract by release, Precision, accord and satisfaction, or Novation.

A contract may be discharged by operation of law through bankruptcy decrees, the running of the statute of limitations, or the intentional unauthorized material alterations of the agreement.

Non-performance is excused by the destruction of the subject matter, enter Vining illegally, or condos by one party that makes performance by the other party objectively impossible.

Commercial frustration is a defense to non-performance.

Actual or anticipatory breach May discharge contract.

Constructive or Express conditions May discharge a contract.

When a breach-of-contract occurs, the injured party has a duty to mitigate his or her damages.

The injured party May sue for monetary damages. Compensatory damages Place apart e in the same economic position that he or she would have enjoyed had the contract been performed. Depending on the facts the court May Grant consequential or special damages. Unacceptable conduct in the future. Normal damages assessed if no actual damages occurred or the plaintiff cannot prove his or her damages.

The parties may include liquidated damages clause and their contracts which specify and Advance amount of money to be paid for certain types of breaches liquidated damages Clause are not enforceable if they are penalties.

Courts May award eligible remedies when monetary damages are inadequate. Include reformation and injunctions. In some states quasi contract is considered an equitable remedy.

Specific performance is an equitable remedy that requires a breaching party to perform the terms of the agreement. Usually when the subject matter of the contract is unique. They were elected to Grant specific performance for personal service contracts.

The injured party may choose to waive the breach of contract. Waiver does not prevent the injured party from seeking recovery for damages resulting from the breach