CH 5 - CH 5: The Maturing and Breach of Contract Duties I....

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CH 5: The Maturing and Breach of Contract Duties I. The Effects of Express Conditions a. General Rule: Failure of a Promise is breach of K i. Failure of a condition means that the duty to perform does not arise (condition precedent) or does not cease (condition subsequent) ii. Rules to Construe Contracts 1. The court, not the jury interprets contracts 2. Court construes contracts against the draftsman 3. Expression of one item in a K excludes the other iii. Rules to Determine Whether a Promise or Condition 1. If language is Ambiguous, court assumes PROMISE 2. If language is ambiguous and the party whom the purported condition would benefit has ASSUMED THE RISK of its satisfaction, then the clause is a Condition and NOT and Promise 3. Language construed by INTENT of the parties, provided it can be determined from other terms of the K 4. If Draftsman is to perform, it is a Promise, if Non-draftsman is to perform, it is a Condition 5. If the clause can be waived, it is a Condition b. Howard v Federal Crop Ins Corp i. P plows under tobacco stalks allegedly ruined by storm ii. D’s policy requires stalks to remain until adjuster can verify crop damage iii. Court: Requirement was NOT condition precedent iv. When it is doubtful whether words create a promise or a condition precedent, they will be construed as creating a promise 1. The provisions of a contract will not be construed as conditions precedent in the absence of language plainly requiring such construction; therefore, ambiguous language constitutes a Promise v. Rest 261: Interpretation of Doubtful Words as Promise or Condition 1. Where it is doubtful whether words create a promise or an express condition, they are interpreted as creating a promise; but the same words may sometimes mean that one party promises a performance and that the other party’s promise is conditional on that performance c. Glaholm v Hays- charter cargo i. Whether a particular clause is a condition which, when not performed, allows a party to abandon the K, or amounts only to a promise, the breach of which is recompensed by damages, must depend upon the intention of the parties, to be determined from the language of the entire agreement and the subject matter to which it relates ii. Court held condition precedent because looked to the intent of the parties d. Mularz v Greater Park City- i. Actor put words in = promise ii. Non-actor put words in = condition precedent e. Merritt Hill Vineyards v Windy Heights Vineyard i. While a party’s failure to fulfill a condition excuses performance by the other party whose performance is so conditioned, it is not, without an independent promise to perform the condition, a breach of K subjecting the nonfulfilling party to liability for damages f. Gray v Gardner
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Ch 5: 2 i. The determination of whether the condition clause is subsequent or precedent should be made on the basis of who it is to protect (who wants the benefit from it) 1. That party has the Burden of Proof that the condition is satisfied
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CH 5 - CH 5: The Maturing and Breach of Contract Duties I....

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