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Termination of performance and Terms and Obligations - Coggle Diagram
Termination of performance and Terms and Obligations
Termination of Performance
Contract and its obligation can be terminated by completing performance, by agreement of the parties or by operation of the law
Performance by Performance -- This is when debtor performs full and proper performance which is required. The performance must be made at the time and place that is agreed by the parties. It is also possible for a third party to perform for the debtor.
Termination by agreement can take three forms (when the parties both agree to terminate the obligations of the contract. Firstly, through a release and waiver, novation and Compromise.
Release is an express tacit agreement that the debtor be freed from obligations and Waiver is choide by the creditor to abdon the right that they have.
Novation happens when the parties to an original contract agree that the obligation be extignushed and new obligations are created in their place.
Compromise also referred to as a settlement is an agreement between the parties to regulate their legal positions where the legal position is uncertain or where there is a dispute between them.
Termination by operation of the law -- this measn when the law dictates that the obligation is done.
This can set off which occurs when two parties have claims against each other.
This can be a merger which is when a party becomes his own creditor and debtor and a great example of this is when a tenant who was renting a property eventually buys the ownership of the property.
The law termination can also be prescription in which the rights to an action have been terminated because a certain time period has lapsed.
There can also be supervening Impossibility which objective and unavoiable even by a reasonable person.
Terms and Obligations
Contractual obligations include the rights and duties that are formulated in terms of a contract.
There are different types of obligations which include simple, alternative, generic and facultative obligations.
When a performance is divisible, it simply means that it can be divided and when its indivisible, it simply means that it cannot be divided into components.
Express terms are those that the parties have agreed on through verbal communication or writing.
Ticket cases are when the terms are recorded and the person purchasing the ticket knows or should know the writiing on them. If a company gives you a ticket with contract terms on it, you can still be bound by those terms as long as the company took reasonable steps to make you aware of them.
Notices - An exemption or owner’s risk clause is a notice, commonly displayed in places like parking garages, shopping centres, and public venues, that excludes a service provider’s liability for negligence (but not for fraud because of public policy), and the customer will be bound by it if they knew or reasonably should have known about the notice
Terms prohibited by the law -- these are terms that are against public policy or they are in conflict with statutory prohibitions.
Tacit contracts are the contract that can be inferred from the conduct of the parties.
A good example is a lease agreement that has expired but the leasee continues to remain in the place and the lessor accepts the rent.
Implied terms are those that are not explicitly stated and agreed upon by the parties by they are included in the contract. This can be by virtue of operations of the law or from the facts surrounding the agreement of the parties.
Conditions -- This is when a term will only be a contractual obligation which its operation and consequences depends on whether an uncertain future event will happen or not.
This can be positive or negative obligations: Negative condictions depends on a future uncertain event not happening and positive conditition depends on an uncertain future event happening.
Suspensive condictions is when there is an agreement that the performance of the obligation will not be enforced until we know whether the condition which relates to an uncertain future even has been fulfiled.
Resolutive conditions is when the parties agree that a contractual obligation should operate in full, but then will come to an end if an uncertain future even does happen or does not happen.
Clauses
Time clauses - Existence of an obligation dependent on an event or time that is certain to arise in the future. We have two types here, suspensive and resolutive time clause
Suppositions -- this is when there is an assumption that a certain state of affairs exist or existed.
Exemption clauses -- these are essentially terms that are exempt a party from liability.
Non-variation clauses -- terms that specifies that a party may not vary the contractual terms.
Warranties is a term whereby a party assumes contractual liability for the existence of a certain state of affairs.