Contract Law-Breach of Contract and Remedies notes for Law Students

Ans. Breach of contract means a breaking of the obligation which

a contract imposes. It occurs when a party to the contract without lawful

excuse does not fulfill his contractual obligation or by his own act makes

it impossible that he should perform his obligation under it. It confers

a right of action for damages on the injured party,

Breach of contract may be :

1. Actual breach of contract, or

2. Anticipatory or constructive breach of contract.

It may take place;

(1) At the time when the performance is due: Actual breach of

contract occurs, when at the time when the performance is due, one

party fails or refuses to perform his obligation under the contract.

Example: A agrees to deliver to B 5 bags of wheat on ist January.

he does not deliver the wheat on that day. There is a breach of contract.

If time is not of the essence of the contract and the defaulting party

expresses his willingness to perform the obligation after the appointed

time the other party may accept the performance subject to the payment

of compensation for failure to perform the obligation at the appointed

time. Prior notice shall have to be given to the party in default by the

party not in default if compensation is to be claimed.

(2) During the performance of the contract: Actual breach of

contract also occurs when during the performance of the contract, one

party fails or refuses to perform his obligation under the contract. Theis

refusal to perform may be by :

(a) Express repudiation (by word or act): Where there has been

some performance of the contract and one party by his word or act

refuses to continue to perform his obligation in some essential respect,

the other party can treat the contract as no longer binding on him and

sue for breach of contract.

Example: C contracted with a railway company to supply it 3,000
tons of railway chairs at a certain price, to be delivered in installments
.
After 1,787 tons had been supplied, the railway company asked C to
deliver no more. Held, C could bring an action for breach of contract
[Cort v. Ambergate etc. Rly. Co., (1851) 17 Q.B. 127].
(b) Implied repudiation (impossibility created by the act of a party
to the contract) : If a party, during the performance, makes by his own
the fact the complete performance of the contract is impossible, the effect is as
if he has breached the contract, and the other party is discharged from
the further performance of the contract.
Example : P, a British subject, was engaged by the Captain of a
warship owned by the Japanese Government to act like a fireman.
Subsequently when the Japanese Government declared war with China,
P was informed that the performance of the contract would bring him
under the penalties often Foreign Enlistment Act. He consequently left
the ship. Held, he was entitled to recover the wages agreed upon (O Nell
V. Armstrong (1895) 2 Q.B. 418].
In both cases (a) and (b) the party not in breach can treat the
contract as no longer binding on him and sue for breach of contract.
2. Anticipatory breach of contract
It occurs when a party to an executory contract declares his
the intention of not performing the contract before the performance is due.
He may do so :
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-(1) By expressly renouncing his obligation under the contract.
Example: A undertakes to supply certain goods to B on 1st January.
Before this date, he informs B that he is not going to supply the goods.
This is an anticipatory breach of contract by express repudiation
(2) By doing some action so that the performance of his promise
becomes impossible.
Example: A promised to assign to B, within seven years from the
date of his promise, all his interest in a lease for the sum of £, 140.
Before the end of seven years, he assigned his interest to another person.
Held, this was an anticipatory breach of contract by implied repudiation
[Lovelock v. Franklyn, (1846) 8 Q.B. 371).
Séc., 39 gives expression to the doctrine of anticipatory breach.
“The rights of the promisee (the party not in breach or the aggrieved
party) in case of an anticipatory breach are as follows:
(1) He can treat the contract as discharged so that he is absolved
of the performance of his part of the promise.
(2) He can immediately take legal action for breach of contract
or it till the time the act was to be done.
An anticipatory breach does not necessarily discharge the contract,
unless the promisee (the aggrieved party) so chooses.
Example: Disengaged H on the 12th of April to enter into his service
as a courier and to accompany him upon a tour. The employment was to