The Effects Of Breach Of Contract

1615 words - 6 pages

The effects of breach of contractIntroductionDifferent approaches are needed since there are various consequences when there is a breach of contract. It is useful to have a number of different approaches which will give the opportunity to use the most appropriate method for the given case.Keenan & Riches (2009: p. 283) define a breach of condition "the injured party has the alternative of treating the contract as being completely broken by non-perfomance or claim damages". The damages mean that the innocent party can receive money as compensation which is the remedy. The innocent party will sue for damages and the court will then decide whether it is a breach of condition or breach of warranty."A breach of warranty is a less important term, which does not go to the root of the contract. It means that it will only give the injured party the right to claim damages: the contract cannot be broken" (Keenan & Riches 2009: p. 283). The same remedies for a breach of condition are also concerned with a breach of warranty.In Poussard v Spiers and Pond (1876), (Keenan & Riches 2009: p.283) The case is about an actress who was suppose to play the leading role in an operetta for a season. Unfortunately she was one week late after the season had begun. The producers had to take in a replacement and when the actress finally came, the producers did not want her to participate and aimed to end the contract. The actress sued for breach of contract and lost her case. Since the premiere was very important and the actress was never present that night, this was a breach of condition which enabled the producers to eliminate the contract.[1: [1876] 1 QBD 410]A comparison can be made between the case of Bettini v Gye (1876), (Keenan & Riches 2009: p. 283), this was also about a singer who was suppose to be employed for a season. The contract implied that the singer should be present six days before the start of the season, to be able to rehearse. The singer arrived three days before the start of the season. The producers thought this was a breach of condition and that they had the right to elimnate the contract. The singer sued for breach of contract and was successful. The court held that the terms regarding rehearsals were merely secondary to the main terms of the contract (that is, they were only warranties). The producers were therefore only entitled to sue for damages. [2: [1876] QBD 183]The advantage of classifying a term as a condition or a warranty approach is if the parties know what type of term has been breached, they will also know what action is appropriate. For example, if the term breached is a condition, the parties will know for certain that they have a right to terminate the contract."An implied term of a contract which is neither classed as a condition or a warranty but somewhere in between; an intermediary or innominate term". (Ainsworth Lumber 2004)The innominate term approach was established in the case of Hong Kong Fir Shipping v...

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