Conditions & Breach
A contract to sell a house states it is “conditioned on buyer securing financing at 6%.” Buyer can only get 6.5% but declines it. Must they buy the house?
No — this is an express condition, and it was not strictly satisfied.
A seller breaches. Buyer covers at a slightly higher price. What damages can buyer recover?
Cover damages: cover price – contract price + incidental/consequential damages
A hurricane destroys a factory the day before a contract deadline. Can the seller be excused?
Possibly — under impracticability, if the risk was unforeseen and not assumed.
A contracts to paint B’s house. B’s son, who lives there, sues when A never shows. Can he enforce the contract?
Only if he’s an intended beneficiary, not just an incidental one.
A contractor says “I’ll install the cabinets, but only if you promise to pay me extra.” The owner agrees. Enforceable?
Likely no — violates the pre-existing duty rule unless new consideration exists.
A contractor refuses to begin work unless the owner agrees to pay 20% more than agreed. The owner agrees under pressure. Is the new price enforceable?
Likely not — this is duress or lack of consideration under the pre-existing duty rule.
A buyer breaches after paying a $2,000 deposit. There’s no liquidated damages clause. Can seller keep the full deposit?
No — under UCC, seller can keep $500 or 20%, whichever is less, plus actual damages.
A street performer’s license is revoked after they book events. Is their performance excused?
Yes — revocation of license can make performance impossible or illegal.
A assigns her right to receive rent from B to C. B doesn’t pay C. B says no one told her. Does she owe C?
No — the obligor must receive notice before being obligated to pay the assignee.
A party agrees to a contract based on a false statement. The speaker believed it was true. Can the contract be voided?
Yes — innocent misrepresentation still makes a contract voidable.
A buyer repudiates a car purchase. The seller keeps building the car anyway and sues for full price. What doctrine may limit their recovery?
Duty to mitigate — seller may not recover for performance after repudiation.
A seller breaches. Buyer does not cover. Market price is $200 higher than contract. What can buyer claim?
Market damages: market price – contract price.
A landlord rents a balcony for a parade. Parade is canceled. Can the tenant void the contract?
Yes — the principal purpose was frustrated, so frustration of purpose applies.
A promises to pay B's debt to C. C sues. Is this allowed?
Yes — C is a creditor beneficiary and can enforce the contract.
A contract is so one-sided that it shocks the conscience. What doctrine applies?
Unconscionability — may be procedural, substantive, or both.
A contractor uses the wrong brand of pipe, but the house functions fine. The owner refuses to pay. Can they win?
No — under substantial performance (Jacob & Youngs), trivial deviations don’t excuse payment.
A party sues for $1 million in lost profits but provides no reliable evidence. What limit applies?
Certainty — expectation damages must be proven with reasonable certainty.
A seller’s source of supply dries up, but they didn’t specify the source in the contract. Can they claim impracticability?
No — if not specified, courts assume seller assumed the risk.
A assigns the right to payment to C without consideration. Can she revoke it?
Yes — gratuitous assignments are generally revocable, unless relied upon.
A party uses fine print to sneak in surprise terms. The other party signs unknowingly. Enforceable?
Possibly not — may be procedurally unconscionable.
A buyer promises to buy “if satisfied with the product.” They reject it due to aesthetics. Must they be reasonable?
No — if based on personal satisfaction, only honest dissatisfaction is required.
A breaching builder partially completes a project. Owner hires someone else to finish. Can builder recover anything?
Yes — possibly restitution for value conferred, minus the owner’s cost to complete.
A party refuses to perform unless the price is doubled, claiming costs unexpectedly rose. Is this a valid excuse?
No — mere increase in cost is not enough for impracticability.
A delegates performance to B. B fails. Can the obligee sue A?
Yes — unless there was a novation, A remains liable.
A party uses a position of trust to pressure another into signing. What defense applies?
Undue influence — occurs when improper persuasion overcomes free will.