This is an extract of our Termination By Breach Or Repudiation document, which we sell as part of our Contract Notes collection written by the top tier of Griffith University students.
The following is a more accessble plain text extract of the PDF sample above, taken from our Contract Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
TERMINATION BY BREACH OR
Right to rescind
o Rescission ab initio
SS? Discharge from the beginning
o Can the parties returned, (substantially), to their original position?
SS? Misrepresentation, mistake, unconscionable conduct, duress, undue
influence, and or misleading or deceptive conduct * Right to terminate
o Right to terminate the performance of the contract in futuro
o Accrued rights may still be enforceable but not future rights
SS? Breach and repudiation * Repudiation gives right to terminate
Right to Terminate
* Every breach of contract gives rise to a right to damages * Not every breach entitles the promise the right to terminate the contract * Right to terminate can come from:
o Termination clause in the contract
SS? Allows parties to alter the common law and is a question of
SS? Statute * Rare, but certain legislation does give this right
o Sale of Goods, ACL etc.
SS? Cannot contract out of ACL
SS? Remedies are also through the statute
SS? Common Law * Arises in 3 situations:
o Breach of a condition
SS? An essential term in the contract
o A fundamental breach of an intermediate term
SS? Words or conduct amounting to a refusal to
perform the contract
Termination for Breach of a Condition
* All breaches of a condition will give rise to the right to terminate, regardless of the
gravity of the breach
o Arcos v Ronaasen * Express or implied * A term can be deemed a condition
o By statute
SS? ACL s54 "guarantee as to acceptable quality"
SS? By designation * Need a clear intention for term to have status as 'condition' * Use of the word condition is not decisive
o Schuler v Wickman Machine Tool Sales
o By construction
SS? "the test of essentiality is whether it appears from the general nature of
the contract, that the promise is of such importance that the promisee
would not have entered into the contract unless he had been assured of a
strict or substantial performance of the promise and this ought to have
been apparent to the promisor" - Jordan CJ *
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