condition
an event, not certain to occur, which must occur, unless its non-performance is excused, before performance under a K becomes due
express conditions
conditions included in the parties' K
pay if/pay when paid clauses are especially seen where
general and subcontracts
what do courts say about pay if/paid when paid clauses
This will be decided on a case by case basis. they'll look and if it isn't clear then it'll be construed as a promise
constructive conditions
conditions put in K by a court
constructive commercial conditions
if the K requires something not personal or unique, the standard is would a reasonable person be satisfied?
constructive personal conditions
if the K requires something of personal liking, then that person MUST be satisfied
constructive professional conditions
expert has to give professional opinion, even if parties don't agree
excuse of a condition
doctrines may excuse a fact or event from occurring
anticipatory repudiation
a type of excuse -- being ready, willing, and able to perform
promise (promise v. condition)
#NAME?
condition (promise v. condition)
-requires the parties to agree
-postpones a duty of promisor
-normally activates a duty when it happens
-normally discharges a duty if it doesn't happen
Because courts don't like conditions, what will they do?
When they can, courts will try to construe as much as they can as a promise instead of a condition. if there's a condition, the condition couldn't be prevented from performing it. Create the situation where you no longer have to perform under the K.
conditions classified by how they arise:
-express: spelled out in K;
-Implied in fact: based upon the conduct of the parties
-constructive: implied in law conditions, court comes in and knows its a condition but the court now has to construe the condition.
condition precedent
something has to happen first before I have to perform under the K. Until it takes place, then I don't have to do anything
example of a condition precedent
I am her TA if I get an A
concurrent condition
to the degree that the parties can perform their contract at the same time, they should
concurrent condition example
I will sell you my car for X and you can take the car now
Condition subsequent
something has to happen to make the contract invalid. something now turns off the obligation to perform
condition subsequent example
I am her TA, but if I don't get an A, I am not
express conditions and conditions of commercial satisfaction/satisfaction clauses
-Subject matter of the K is commercial in nature, and capable of objective evaluation (use the objective standard, unless it would be impracticable to do so).
express conditions and conditions of personal satisfaction/satisfaction clauses
subject matter of the K is personal or not capable of objective evaluation (subjective in good faith)
conditions of satisfaction example
If someone is having their grass cut in a very particular way and hire a particular person to do it that way, and it is said in the contract that it is personal, then it is personal condition. But if it doesn't say then it is commercial because it is just
Oscar Wilde went to Ames Whistler and asked to have his portrait painted, agreeing to pay Whistler 40 pounds if he was satisfied with the painting. Whistler produced what all agree to be a masterpiece, but Wilde pooh-poohed it "crude and mean." Whistler s
Whistler has the burden of proof. If Wilde isn't satisfied then Whistler doesn't get paid
When Scarlett decided to sell her ancestral home, Tara, she engaged in services of Mitchell Realty, agreeing to pay a 10 percent commission if the company could produce a satisfactory buyer. Mitchell Realty scouted around and found a millionaire named Joh
condition of commercial satisfaction. how what you're looking at is whether a reasonable person would be satisfied with that buyer.
Four Star Construction Co. built a $4 million building for Octopus National Bank, with payments to be made as the project progressed. Fifteen percent of each progress payment was to be withheld in a retainage account to be paid at the end of the project a
Condition of professional satisfaction. the professional can't act in bad faith and they have to give a professional opinion.
In a constructive condition of exchange, who goes first/
independent, dependent, but, if the parties can perform at the same time, they should.
how are constructive conditions satisfied?
substantial performance, perfect tender rule
substantial performance
didn't do exactly what was asked, but it asks if it was good enough
If performance has been substantial, what does it mean?
you've got everything you want and whatever else is immaterial. the court will implement this
substantial performance -- four factors + one
1. purpose to be served
2. desire to be gratified
3. excuse for deviation from the letter
4. cruelty of enforced adherence
+
good faith (cannot be willful, fraudulent, or material)
substantial performance and UCC
doesn't apply to the UCC, rather, it has the perfect tender rule
perfect tender rule
requires that the goods conform to the contract in every respect
three exceptions to the perfect tender rule
right to cure; installment Ks; and unless otherwise agreed
right to cure
UCC says that there's an expectation of good faith and the party gets an opportunity to make the mistake right
right to cure example
when you order shoes that are yellow and you get home and realize they're red. you go back to the seller and ask them to give you the yellow ones.
installment Ks
if you enter into the contract, they're assuming that there is one sale. because there is the one sale, the PTR comes into play. Says that the parties can't just stop the contract UNLESS whatever they do cannot be fixed. makes it harder to get out of thes
unless otherwise agreed
creates the contract for exactly what the customer agrees to.
Restatement (Second) of Contracts Section 234. Order of Performances (concurrent conditions)
where all or part of the performances to be exchanged under an exchange of promises can be rendered simultaneously, they are to the extent due simultaneously, unless the language or the circumstances indicate to the contrary.
UCC Section 2-507(1)
Tender of delivery is a condition to the buyer's duty to accept the goods and, unless otherwise agreed, to his duty to pay for them. Tender entitles the seller to acceptance of the goods and to payment according to the contract.
tender
show up with money in hand. the seller shouldn't have to chase the buyer down. they have to tender and then their obligation is complete
UCC Section 2-511(1)
unless otherwise agreed tender of payment is a condition to the seller's duty to tender and complete any delivery
UCC Provisions and PTR -- SEction 2-508(1). Cure by seller or improper tender or delivery; replacement.
The right to cure (right of breacher to fix)
Where any tender or delivery by the seller is rejected because non-conforming and the time for performance has not yet expired, the seller may seasonably notify the buyer of his intention to cure and may then within the contract time make a conforming del
shaken faith doctrine
faith is shaken in the quality of the product. if you have this and prove this, then you do not have to accept the product or allow the seller to cure.
only applies to life or death circumstances