Anticipatory Repudiation

• Author: autor
• Pages: 198-208

198

Chapter 14. Anticipatory Repudiation

14.1. Common Law Development of Anticipatory Repudiation. Logically, can you have an

actual breach of the contract before the performance is due? No. But if a person who has

promised to perform “repudiates” by telling you (expressly or impliedly) that he does not intend

to perform when the time comes for performance, you have an “anticipatory repudiation.” (A

“repudiation” is a refusal to perform.)

14.1.1. The concept of anticipatory repudiation developed under common law. At

common law, an express repudiation is a clear, positive, unequivocal refusal to perform

(orally or in writing) prior to the date performance is due.

14.1.1.1. An example of a clear and unequivocal repudiation would be: “I’m not

going to perform at the concert as I promised to do.”

Problem 14-1. Bette Midler has agreed to perform at a concert on May 1. On April 15, she sends

a fax stating: “I’m not sure if I will be able to perform on May 1. Will keep you posted.” Is this

an express repudiation at common law? Why or why not?

14.1.2. In addition to an express repudiation, common law recognizes an implied

repudiation. An implied repudiation results from voluntary conduct “where the promisor

puts it out of his power to perform so as to make substantial performance of his promise

impossible.” Taylor v. Johnston, 539 P.2d 425 (Cal. 1975). For example, if I have a

contract to sell you my car, and then I sell it to someone else, I have impliedly repudiated.

Note that Restatement (Second) of Contracts § 250 refers to “a voluntary affirmative act

which renders the obligor unable or apparently unable to perform. . . .” In other words, as

long as a reasonable person would believe performance is not possible, the conduct may

be treated as an anticipatory repudiation.

Problem 14-2. Lindsay Lohan agreed to perform in a movie that would start filming on May 1.

On April 15, the producer read in an industry newsletter that Lindsay had checked into a six-

week in-patient drug rehabilitation program. Is this an implied repudiation at common law? Why

or why not?

14.1.3. At common law, the prospective breach must be serious enough to qualify as a

material breach of the contract. An indication of intent to deviate in some minor way

from the promised performance may not be sufficient.