An Introduction to Performance and Breach

AuthorFranklin G. Snyder, Mark Edwin Burge
An Introduction to
Assume now (1) that we have a valid contract, (2) that no defenses prevent the
contract’s enforcement, and (3) that we know exactly what the contract says and
means. The next question a lawyer must be able to answer in a potential contract
dispute is whether one or more of the parties has breached the contract. Any failure
to do what a party has promised to do is a breach. Given the almost limitless number
of potential terms to which parties can agree, the question of whether the party did
what it was obligated to do will usually be highly fact-intensive.
All Breaches Aren’t Created Equal? Finding that a party did not do what it
was supposed to do does not end the inquiry. Every breach of contract entitles the
non-breaching party to claim damages or some other remedy. But often the non-
breaching party does not want to sue for damages, but it instead wants to cancel the
contract. As you will see from the materials in this chapter, not all breaches allow the
aggrieved party to do that. Determining whether a particular failure to perform will
allow the other party to cancel the contract depends on the standard of performance
we use to decide the question. American contract law sometimes allows a party to
cancel the agreement no matter how small or unimportant the breach is, a standard
that lawyers call perfect tender. But contract law also sometimes requires parties to
accept and pay for a performance that is not exactly what was bargained for, a
standard called substantial performance.
When Is Close Good Enough? An example may help to understand this
distinction. You may recall the famous court case in Shakespeare’s Merchant of
Venice where the court holds that Shylock is entitled to take a “pound of flesh” from
But he would, as Portia points out, breach the agreement himself if he took
more or less than a pound. Does he have to remove exactly a poundthat is, 453.592
gramsor is there some amount of leeway? If he takes one pound more or less, has
he breached in a way that would allow Antonio to back out of the deal? Or would he
just be liable for the additional damage caused by the additional flesh taken? These
two standards and the rules for how they work and when they are used are the subject
of the next unit.
Excuses, Excuses. Even when a party fails to perform substantially (or even
at all), it still may not be liable for breach of contract. How can this happen? In some
situations, the law will excuse a party who failed to perform. The second unit in this
chapter, covering contract excuses, deals with exactly this situation. You will be
introduced to doctrines known as “commercial impracticability” and “frustration of
By this point, we hope you realizee ven without reading the chapter on Remedies
that a co ntract permitting extraction of a pound of flesh in the event of a breach would be void as a
matter of public policy. You did realize that, didn’t you?

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT