UGBA 175 Lecture Notes - Lecture 18: Consequential Damages, Novation, Rescission
2 Nov 2016
School
Course
Professor
UGBA 175
Lecture 18 11/1/2016
Duty to mitigate
- By the injured party to lessen their damages
- Ex. De La Tour case: duty of H to find a new job
- If do not mitigate, you cannot recover samages
Northern Corp v. Chugach
- Issue: was the contract impossible of performance?
- Commercial impracticability: UCC
- Impossibility test is objective
- )sn’t impossible, but impractical and life threatening
Mutual rescission
- Type of contract to end another contract
- Both agree to terminate duties
- Consideration: each give up rights to the others’ duties/ obligations
Substituted contract
- New contract in satisfaction of the duties under the original contract
- Once the new contract is done, the old is forgiven
Accord and Satisfaction
- A: substituted duty (not new contract)
- S: Performance of new duty which discharges the old obligation
- Example: changing a clause in a contract
Novation
- Involves 3 parties: add new promise that new promisor who substitutes
- All 3 must agree
- Tenant wants the novation (someone to assume his liabilities), not the landlord
Chapter 17
- Problem 1
o Frustration of purpose, impossibilitie, destruction of dubject matter
o Unforeseen act → discharged
o Have to pay what has been done (fulfill contract up to that point, rest is
forgiven)
o Substantial performance does not matter
- Problem 2
o Frustration of purpose
o Explicit condition written in the contract
o Nancy wins → discharges
- Problem 3
o Unprecedented → not foreseeable
o Not perfect tender rule
o Obligations are discharged because of objective impossibility
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
By the injured party to lessen their damages. De la tour case: duty of h to find a new job. If do not mitigate, you cannot recover samages. Consideration: each give up rights to the others" duties/ obligations. Type of contract to end another contract. New contract in satisfaction of the duties under the original contract. Once the new contract is done, the old is forgiven. S: performance of new duty which discharges the old obligation. Example: changing a clause in a contract. Involves 3 parties: add new promise that new promisor who substitutes. Tenant wants the novation (someone to assume his liabilities), not the landlord. Problem 1: frustration of purpose, impossibilitie, destruction of dubject matter, unforeseen act discharged, have to pay what has been done (fulfill contract up to that point, rest is forgiven, substantial performance does not matter.
