Term
| What is a "constructive condition"? |
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Definition
| A condition that the parties did not actually agree to, but which the court will impose ("construct") as a matter of justice. |
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Term
| What three effects does the non-occurrence of a constructive condition generally have? |
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Definition
| (1) The other party's subsequent duties do not mature (and thus the other party does not breach the contract when not performing them); (2) the other party has the power to terminate the contract (and doing so is not a repudiation); and (3) if the other party exercises the power to terminate the contract and the non-performing party's failure to perform was a breach, the other party can sue the non-performing party for breach of all the non-performing party's remaining duties. |
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Term
| What is the general test regarding constructive conditions? |
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Definition
| It is an implied-in-law condition of a party's remaining duties under a bilateral contract that there is no uncured, material failure of performance (whether a breach or not) by the other party of its contract duties under the same bilateral contract (unless the doctrine of divisible contracts applies) that were due at an earlier time, unless a contrary intention is clearly manifested. |
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Term
| When the performance of a promise is conditional upon the other party's prior performance, the promises are called what? |
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Definition
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Term
| When the performance of a promise is not conditional upon the other party's prior performance, the promises are called what? |
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Definition
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Term
| In the absence of the parties agreeing on the order of performance, how do courts determine the order of performance? |
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Definition
| Performances are due simultaneously if the parties' performances can be rendered simultaneously. Where the performance of only one party will require a period of time, that party's performance is due first. |
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Term
| When the parties' performance are due simultaneously, and they are dependent covenants, what kind of conditions are they? |
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Definition
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Term
| When one party's performance is due before the other party's performance, if the promises are dependent covenants, what kind of condition exists? |
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Definition
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Term
| What is the rule regarding concurrent conditions? |
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Definition
| It is an implied condition of each party's duty to render performance that the other party render or, with manifested present ability to do so, offer performance of his or her part of the simultaneous exchange. |
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Term
| What is a divisible contract? |
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Definition
| A contract under which separate transactions are combined into a single contract, but which is treated as divisible for the purpose of the law of conditions. |
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Term
| What is another name for a divisible contract? |
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Definition
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Term
| What is the divisible contract rule? |
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Definition
| If a contract involves multiple promises on each side, and it can be concluded the pairs of corresponding promises were consideration for each other, those corresponding promises are considered "divisible" or "severable" from the other corresponding promises in the contract. In that situation, the injured party must pay for any performance received under a divisible portion even if there has been a material breach of another portion. |
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Term
| True or false: With a divisible contract, the injured party retains the power to terminate the entire contract upon a material breach of a divisible portion, provided the breach occurred before the breaching party performed either portion. |
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Definition
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Term
| True or false: Two nominally seperate contracts that are in fact an integrated contract are treated as a single contract for purposes of the law of conditions. |
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Definition
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Term
| True or false: A material non-performance that is excused and thus not a breach cannot be the non-occurrence of a constructive condition. |
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Definition
| False. The rule applies to any material non-performance, not just a material breach. |
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