Confused about substantial performance

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RR320
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Confused about substantial performance

Postby RR320 » Mon May 14, 2012 2:33 pm

During our course review my professor said that substantial performance is not a defense to a promise to perform. So when would you bring up substantial performance?

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ph14
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Re: Confused about substantial performance

Postby ph14 » Mon May 14, 2012 2:34 pm

RR320 wrote:During our course review my professor said that substantial performance is not a defense to a promise to perform. So when would you bring up substantial performance?


I think you would bring it up when defending against an allegation of a material breach. If you promised to perform, you will be held in breach if you fail to live up to the letter of that promise. So "substantial performance" would not be a defense to the promise. You would still be liable for the damage caused by your lack of full performance according to your contract.

waxecstatic
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Re: Confused about substantial performance

Postby waxecstatic » Mon May 14, 2012 2:55 pm

Typically substantial performance would be a defense if being sue for full damages, rather than remedial. Substantial performance = immaterial breach.

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3|ink
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Re: Confused about substantial performance

Postby 3|ink » Mon May 14, 2012 3:09 pm

RR320 wrote:During our course review my professor said that substantial performance is not a defense to a promise to perform. So when would you bring up substantial performance?

I think the idea is when you haven't breached materially. See Jacob & Young v. Kent.

Moreover, substantial performance only refers to non-sales. In sales, perfect tender reigns.

Slobberson
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Re: Confused about substantial performance

Postby Slobberson » Mon May 14, 2012 5:29 pm

waxecstatic wrote:Typically substantial performance would be a defense if being sue for full damages, rather than remedial. Substantial performance = immaterial breach.


This is the heart of the issue. If there has been substantial performance, then any breach is immaterial. That means that the other party is NOT EXCUSED from his future performances by the other party's breach because he has gotten what he bargained for. The non-breaching party must still perform his obligations under the contract, but can sue for the damages arising from the breach.

If there has not been substantial performance and the party fails to do anything else, then the breach (for failure to substantially perform) is material and the other party is excused from his future performances. He can (1) not perform his part of the contract if he hasn't already and (2) sue on the contract for expectation damages.

Basically, if there is a breach by A, but A has substantially performed, then the breach is immaterial. B must still perform but can sue for damages arising from the breach. If there is a breach by A, and A has NOT substantially performed, then the breach is material and B is excused from his future performances and can sue for expectation damages. Remember, B would have a duty to mitigate in this scenario.

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DocHawkeye
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Re: Confused about substantial performance

Postby DocHawkeye » Mon May 14, 2012 5:56 pm

3|ink wrote:
RR320 wrote:During our course review my professor said that substantial performance is not a defense to a promise to perform. So when would you bring up substantial performance?

I think the idea is when you haven't breached materially. See Jacob & Young v. Kent.

Moreover, substantial performance only refers to non-sales. In sales, perfect tender reigns.


UCC 2-608(1) allows a buyer to "revoke his acceptance of a lot or commercial unit whose non-conformity substantially impairs its value to him if he has accepted it (a) on the reasonable assumption that its non-conformity would be cured and it has not been seasonably cured; or (b) without discovery of such non-conformity if his acceptance was reasonably induced either by the difficulty of discovery before acceptance or by the seller's assurances."




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