Defining the Obligation to Perform

• Author: J.H. Verkerke
• Pages: 1-71

IV. Defining the Obligation

to Perform

We have thus far focused on the rules that determine whether the

parties have made an enforceable contract. Our attention now shifts to the

question of performance. What conduct will be sufficient to fulfill each

party’s obligation under the contract? Are there circumstances that might

excuse performance?

1. Excuse

When we make or receive promises, we understand that there are at

least some circumstances that will extinguish the resulting obligation to

perform. In social settings, a “good excuse” exists whenever an unexpected

contingency prevents someone from fulfilling her promise. If Sharon has

agreed to give several friends a ride to a concert, mechanical trouble with her

car excuses her from a duty to drive, but not from a duty to tell her friends

promptly about her inability to drive. If, however, Sharon is seriously injured

in a car accident on the way to pick up her friends, no one would condemn

her for failing to call.

What is it about our understanding of Sharon’s promise that allows

us to make these nuanced judgments about responsibility? Notice first that

the words of the promise itself play no role in establishing that mechanical

trouble would excuse performance or in distinguishing between the

consequences of mechanical trouble and personal injury. Sharon made an

unqualified promise to drive her friends to the concert, and no one expects

her to recite a litany of circumstances in which she will be unable to perform.

Instead, we rely on a shared understanding about what events justify

nonperformance.

Commercial agreements ordinarily involve comparatively complex

obligations. Their express terms likewise cover a wider array of

contingencies. However, no contract can possibly provide for every event

that might occur between the execution of the contract and the time for

performance. In the two cases that follow, consider carefully the role of

contractual language in allocating the risks of unexpected contingencies. Try

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to develop a theory that can explain and perhaps justify the results in these

cases.

1.1. Principal Case –

Stees v. Leonard

Stees v. Leonard

Supreme Court of Minnesota

20 Minn. 494 (1874)

[1] Appeal by defendants from an order of the district court,

Ramsey county, denying a new trial.

[2] The action was brought to recover damages for a failure

of defendants to erect and complete a building on a lot of plaintiffs, on

Minnesota street, between Third and Fourth streets, in the city of St.

Paul, which, by an agreement under seal between them and plaintiffs, the

defendants had agreed to build, erect, and complete, according to plans

and specifications annexed to and made part of the agreement. The

defendants commenced the construction of the building, and had carried

it to the height of three stories, when it fell to the ground. The next year,

1869, they began again and carried it to the same height as before, when

it again fell to the ground, whereupon defendants refused to perform the

contract. They claimed that in their attempts to erect the building they

did the work in all respects according to the plans and specifications, and

that the failure to complete the building and its fall on the two occasions

was due to the fact that the soil upon which it was to be constructed was

composed of quicksand, and when water flowed into it, was incapable of

sustaining the building. The offers of proof by defendants, and the

character of the allegations in the answer, under which the court held

some of the offers inadmissible, are sufficiently indicated in the opinion.

YOUNG, J.

[3] The general principle of law which underlies this case is

well established. If a man bind himself, by a positive, express contract, to

do an act in itself possible, he must perform his engagement, unless

prevented by the act of God, the law, or the other party to the contract.

No hardship, no unforeseen hindrance, no difficulty short of absolute

impossibility, will excuse him from doing what he has expressly agreed to

do. This doctrine may sometimes seem to bear heavily upon contractors;

but, in such cases, the hardship is attributable, not to the law, but to the

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contractor himself, who has improvidently assumed an absolute, when he

might have undertaken only a qualified, liability. The law does no more

than enforce the contract as the parties themselves have made it. Many

cases illustrating the application of the doctrine to every variety of

contract are collected in the note to Cutter v. Powell, 2 Smith, Lead. Cas. 1.

[4] The rule has been applied in several recent cases, closely

analogous to the present in their leading facts. In Adams v. Nichols, 19

Pick. 275, the defendant, Nichols, contracted to erect a dwelling-house

for plaintiff on plaintiff's land. The house was nearly completed, when it

was destroyed by accidental fire. It was held that the casualty did not

relieve the contractor from his obligation to perform the contract he had

deliberately entered into. The court clearly state and illustrate the rule, as

laid down in the note to Walton v. Waterhouse, 2 Wms. Saunders, 422, and

add: “In these and similar cases, which seem hard and oppressive, the law

does no more than enforce the exact contract entered into. If there be

any hardship, it arises from the indiscretion or want of foresight of the

suffering party. It is not the province of the law to relieve persons from

the improvidence of their own acts.”

[5] In School District v. Dauchy, 25 Conn. 530, the defendant

contracted to build and complete a school-house. When nearly finished,

the building was struck by lightning, and consumed by the consequent

fire, and the defendant refused to rebuild, although plaintiffs offered to

allow him such further time as should be necessary. It was held that this

non-performance was not excused by the destruction of the building.

The court thus state the rule: “If a person promise absolutely, without

exception or qualification, that a certain thing shall be done by a given

time, or that a certain event shall take place, and the thing to be done, or

the event, is neither impossible nor unlawful at the time of the promise,

he is bound by his promise, unless the performance, before that time,

becomes unlawful.”

[6] School Trustees v. Bennett, 3 Dutcher, 513, is almost

identical, in its material facts, with the present case. The contractors

agreed to build and complete a school-house, and find all materials

therefor, according to specifications annexed to the contract; the building

to be located on a lot owned by plaintiff, and designated in the contract.

When the building was nearly completed it was blown down by a sudden