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Discharge Of Contract - Coggle Diagram

- - - - Performance of entire contract
        
        • One in which the entire completion of the work by the contractor is a condition precedent to payment (Lump sum)
        
        • The contractor is not entitled to any payment for work done before completion
        
        General rule of Entire Contract
        
        • The law on entire contract had produced great injustice
        
        Case example
        
        Pf was to istall central heating and to perform certain other works in the Df’s house
        
        The contract price of the central heating installation was a lump sum of £560
        
        Upon completion, Df complained that the work was defective and refused to pay
        
        Held: pf was not entitled to recover for the work done
        
        Doctrine of substantial performance esteblished
        
        • A promisor who has substantially perform his side of the contract:
        
        • May sue on the contract for the agreed sum
        
        • Remains liable in damages for his partial failure to fulfill his contractual obligations
        
        Case example
        
        • KUNCHI RAMAN v GOH BROTHERS SDN BHD
        
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      - Performance under Contract Acts 1950
        
        • Promises bind the representatives of the promisor in case of the death of the promisor before performance.
        
        • S.38: Parties’ obligation to perform a contract
        
        • 38. (1) The parties to a contract must either perform, or offer to perform, their respective promises, unless the performance is dispensed with or excused under this Act, or of any other law
        
        (a) A promises to deliver goods to B on a certain day on payment of RM1,000. A dies before that day. A’s representatives are bound to deliver the goods to B, and B is bound to pay the RM1000 to A’s representatives.
        
        (2) Promises bind the representatives of the promisors in case of the death of the promisors before performance, unless a contrary intention appears from the contract.
        
        (b) A promises to paint a picture for B by a certain day, at a certain price. A dies before the day. The contract cannot be enforced either by A’s representatives or by B.
      - Any deviation in performance from the term of contract - the party not in default will be entitled to say that the contract has not been performed
        
        2 courses of action
        
        May sue for damages for breach of contract
        
        May elect to treat himself as discharged from the further performance of the contract
    - - Df agreed to buy from Pf 3000 tins of canned fruit to be packed in cases containing 30 tins.
        • Delivery: substantial part of the consignment – 24 tins per case
        • Pf’s breach entitled Df to reject the whole consignment
- - - - the contract must be a contract to do an act
      - After the formation, the contract become: impossible to be performed due to some event which the promisor could not prevent, or
        
        Unlawful
        
        Effect: the contract is void- at the time the act become impossible or unlawful
      - Contract is impossible of performance after its formation
        
        Illustr (b) : lost capacity to make contract (i.e; insane)
        
        Illustr (d) : outbreak of war
    - - HA Berney v Tronoh Mines
        
        Pf worked at the dfs’ tin mine. When the Japanese invaded Malaya, the dfs’ European staff members evacuated from Malaya however the pf remain and claimed damages from the dfs. The dfs contended that consequent of the Japanese occuption of Perak, the contract of employment between them and the pf was discharged by frustration
        
        Held: the invasion of Malaya by Japanese forces frustrated the contract. Therefore, there was no breach of the contract by the dfs since the parties are no longer oblinged to perform the contract. (Outbreak Of War) illustration d
      - Krell v Henry
        
        Held: the contract void. The procession and relative position of the flat lay at the foundation of the agreement. The df had rented ‘room to view the procession’ and the pf’s failure to provide that view, though it arose from no fault of his, excused the df from his promise to pay.
    - - • Void automatically
      - • Contract is terminated as to the future only, not from the beginning.
      - • S.66 of CA 1950- remedy of restitution : any person who has received advantage under the contract is bound to restore or to make compensation to the person from whom he received it
- - - - Elect to treat the contract as discharged by the breach
        
        he is relieved, of all further performance under the contract
        
        the innocent party will also be entitled to damages for the breach.
        
        • However, not every breach gives the innocent party the right to terminate the contract (right to damages without discharge)
        
        depends on the nature of the terms breached
        
        if the breach goes to the root of the contract
        
        Such breaches entitles the innocent party to tret the contract as discharged and to sue for damages
        
        if the breach is of a less important term
        
        it is a breach of warranty
        
        the innocent party is not entitled to treat the contract as discharged.
      - He may treat the contract as subsisting
        
        he is entitled to damages but must perform, ready and willing to perform all his obligations under the contract as and when they become due after the breach.